Epitaph for Trump II, Part III

Donald Trump seemed unaware of it, but he had only a few days to accomplish something too. And he faced one critical objective: to stop the federal government’s perennial deficits.

German General Heinz Guderian, on top of a tank, 1941, Source: Getty Images

Wednesday, May 28th, 2025

Bill Bonner, from Amsterdam

‘The Russians already learned a few things.’

—General Heinz Guderian, upon seeing shells from his Panzer tanks bounce off the Russian T-34’s armor.

No responsible historian would endanger his tenure by rushing into an obituary for the second Trump administration. It has barely begun.

Historians typically wait at least fifty years before trying to understand a major event. By then, people have forgotten what it was really like…and are ready to listen to a good story.

So, they create a ‘narrative’ — a plot line — that appears to make sense of it. Then, over time, new narratives appear, each one in line with the intellectual currents of the day.

And yes…even this early, it does look as though the white lines of Trump II are already drying on the highway. Some lead to charming back roads — largely circumscribing the worst ‘woke’ tendencies of the last administration. Some lead to nasty back alleys where old scores are settled…and some to strange and exotic new places.

Annex Canada? Develop Gaza? Tell Apple where to make its phones?

The major thoroughfares are marked out pretty well, too. We’ve seen two of them already. One ran into a brick wall — when it became obvious that Elon Musk was no match for the entrenched federal bureaucracy. He could send them scurrying for cover…but without Congressional backing, the campaign went nowhere.

Another, which we saw yesterday, was like the Wehrmacht’s attack on Stalingrad. It was a sideshow…full of sturm und drang, and it swallowed up an entire army…but it was pointless and ultimately suicidal. So too was Trump’s ‘Trade War’ expensive — both to consumers, who will have to pay higher prices…and to the president, who squandered his precious time and political capital on an unworthy objective.

By July, 1941, the Wehrmacht had advanced at lightning speed across Western Soviet Union…capturing millions of prisoners and destroying most of the Soviets’ aircraft on the ground, along with much of their fighting capacity.

Thereupon, the Germans made a fateful mistake, dividing their forces to strike in three different directions. In the North, they ran into the aforementioned brick walls of Leningrad. In the South, Stalingrad was a one-way street; you could get in, but not out. The Wehrmacht’s third prong was the only one that made much strategic sense. If they could take Moscow, they might have a fair chance of dictating peace terms. Even this was unlikely, but not impossible. (Germans knew only too well that they couldn’t afford a long, drawn-out war.)

In four months, von Brauchitsch’s army was supposed to be in Moscow. But the attack had been delayed until September. And it was deprived of the tanks, guns, planes and soldiers that had been split off to the North and the South.

On October 7th came the first snowfall. The roads turned to mud. Later, according to General Fedor von Bock, the temperature fell to MINUS 49 degrees, the coldest winter of the century. And the shivering, exhausted Germans, with the domes of the Kremlin in sight, could go no further.

This failure meant that the whole war effort was doomed. The Soviets had more men, more fuel, more tanks, more rifles. They were disorganized and ill-equipped in the early days, but as Heinz Guderian observed, they soon ‘learned a few things.’ After the Wehrmacht squandered its ‘first 100 days’, it was just a matter of time before Soviet soldiers were in Berlin.

Donald Trump seemed unaware of it, but he had only a few days to accomplish something too. And he faced one critical objective: to stop the federal government’s perennial deficits. As long as those deficits continued to exceed the rate of GDP growth, the US financial crisis would become more serious and more imminent.

Bringing spending under control had to be Donald Trump’s number one objective. And yet, he made it almost impossible to achieve. First, he assured voters that he wouldn’t touch Social Security. Then, he actually increased the military budget. And finally, as the House of Representatives wrangled with soaring Medicaid costs, he told Republicans not to “f*** around with Medicaid.”

But if you can’t cut these big programs…what can you cut? What’s left? In order to reach a balanced budget, Trump needed to cut $2 trillion of expenses. He ended up cutting nothing at all.

The ‘big, beautiful budget bill’ turned into a highway to nowhere.

“While I love many things in the bill,” wrote Rep. Warren Davidson, “promising someone else will cut spending in the future does not cut spending. Deficits do matter and this bill grows them now.”

But Davidson and the very few other conservative Republicans were overpowered by Trump and their go-along, get-along colleagues.

And so, at the end of the first 120 days, the promise of the Trump administration was effectively shattered. Elon Musk is now out of the picture; his efforts to cut waste and inefficiency produced trivial results. The ‘Trade War’ was called off only a week after Liberation Day. And the Republicans’ Big, Beautiful Budget Bill conceded that spending — and the build-up of debt — will continue much as before.

The budget is still running two trillion dollars in the hole each year. The debt is still scheduled to grow to $60 trillion… maybe $70 trillion…over the next ten years. Interest payments are headed to $1,500 per citizen per year. And interest rates are going up.

Trump II has shot its wad.

We will leave it to future historians to fill in the details.

Regards,

Bill Bonner