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Trump Brings ‘America First’ to Davos

Jan. 26, 2018
Trump is the first U.S. president to visit the conference in 18 years, and while he arrived with a large delegation of Cabinet secretaries and top aides, his address was largely boilerplate.

President Donald Trump said Friday that U.S. economic growth promoted by his policies would help the world, seeking to square his “America First” agenda with globalism.

“When the United States grows, so does the world,” Trump said in a speech to the World Economic Forum in Davos, Switzerland. “American prosperity has created countless jobs around the globe and the drive for excellence, creativity and innovation in the United States has led to important discoveries that help people everywhere live more prosperous and healthier lives.”

Trump is the first U.S. president to visit the conference in 18 years, and he made his government’s presence felt with a large delegation of Cabinet secretaries and top White House aides. His plenary address, though, was largely boilerplate. Trump boasted of U.S. economic performance under his leadership and urged cooperation with the American effort to curb North Korea’s nuclear and missile weapons programs and combat terrorism — routine themes of his speeches, especially to international audiences.

He told the audience that the U.S. still supports free trade as long as it is “fair and reciprocal.”

“The United States is prepared to negotiate mutually beneficial, bilateral trade agreements with all countries,” he said. But he then suggested an exception for Pacific Rim countries that were part of the Trans-Pacific Partnership he abandoned last year.

The U.S. already has trade agreements with some of those 11 countries, he said, and “we would consider negotiating with the rest, either individually or perhaps as a group, if it is in the interests of all.”

Claiming Credit

After taking questions from WEF Chairman Klaus Schwab, Trump left Davos in the presidential helicopter. He faces a number of domestic challenges back home — difficult negotiations with Congress on an immigration overhaul and damaging new reports that he sought last year to fire the special counsel investigating his presidential campaign’s ties to the Russian government.

The audience was effectively the opposite of the crowds Trump is used to encountering at his political rallies in the U.S., even down to the scent: the auditorium smelled of male cologne.

“I’ve always seemed to get for whatever reason a disproportionate amount of press or media,” Trump said in response to a question from Schwab, drawing laughter.

“As a businessman I was always treated really well by the press. It wasn’t until I became a politician that I realized how nasty, how mean, how vicious, and how fake the press can be. As the cameras start going off at the back.”

It was a line that would have worked better in rural Pennsylvania. The crowd booed.

As he does regularly, Trump claimed credit for the run-up in stocks and economic growth that has occurred in his first year in office. In the last year, the Standard & Poor’s 500 Index has surged about 25%. As Trump spoke, a Commerce Department report showed the U.S. economy expanded at a slower-than-projected pace of 2.6% in the fourth quarter, dashing hopes for the longest streak of 3%-or-better growth since 2005.

“After years of stagnation the United States is once again experiencing strong economic growth,” Trump said. “Consumer confidence, business confidence and manufacturing confidence are the highest they have ever been in many decades.”

The International Monetary Fund this week acknowledged Trump’s recent tax cuts were a reason it had lifted its forecast for U.S. economic growth this year to 2.7%. Still, it warned the short-term effect would wear off by 2022 as budget deficits materialized and individual tax cuts expired.

“We have dramatically cut taxes to make America competitive,” Trump said.

Davos Whirlwind

“Well, I wasn’t expecting him to say it was the most egalitarian tax cut in history,” economist Joseph Stiglitz said after the speech. “It’s a tax cut for real estate speculators.”

Stiglitz’s wife, Anya Stiglitz, sat in the audience wearing a “not my president” t-shirt.

The president was in Davos for less than 36 hours. He met with the leaders of the U.K., Israel, Rwanda and Switzerland. He delivered a short speech at a private reception that some people in attendance described as awkward. He hosted a dinner for European corporate executives, which the White House allowed reporters to observe for about 20 minutes as Trump encouraged the business leaders to describe their U.S. investment plans.

“Like all nations represented at this forum, America hopes for a future in which everyone can prosper, and every child can grow up free from violence, poverty, and fear,” Trump said. “The world is witnessing the resurgence of a strong and prosperous America.”

The presence of the nationalist American leader divided participants at Davos, which is in part a celebration of globalism by the world’s financial and government elite.

Wall Street figures and business executives embraced Trump, who late last year signed into law a drastic reduction of the U.S. corporate income tax rate. He has also embarked on an effort to reduce regulations that he considers burdensome to companies.

Martin Sorrell, the CEO of WPP Plc, described the speech as being “as expected.”

“The U.S. is open for foreign direct investment, we’re open for business,” Sorrell said. “He talked about trade, free trade but fair trade, doesn’t want to see America exploited. And lastly he said look what I’ve done so far, which is the tax plan which was implemented faster than people said and at a lower rate than people thought, and is highly stimulative.

“It was a good Trumpian speech.”

Protectionist Concerns

Trump invited business leaders in the audience to invest in the U.S.

“There has never been a better time to hire, to build, to invest and to grow in the United States,” he said. “America is open for business and we are competitive once again.”

But some Davos participants signaled concern with Trump’s protectionist instincts, which were underscored at the start of the week when his government slapped tariffs on imported solar panels and washing machines. European leaders including French President Emmanuel Macron and German Chancellor Angela Merkel promoted multilateralism from the Davos stage; neither of them intersected with Trump at the conference.

By Shannon Pettypiece, with assistance from Simon Kennedy, John Fraher, Stephen Morris and Jan Dahinten.

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