This week’s cover
The week was dominated by news of the next administration. Many of Donald Trump’s nominees and appointees, including Matt Gaetz and Tulsi Gabbard, appear to have been selected mainly because their loyalty to Mr Trump will be untroubled by any scruple.
Less noticed has been Mr Trump’s urgency. Critics often accuse him of being too chaotic to get much done. However, the blistering pace at which names are emerging from Mar-a-Lago suggests that, after four years cooling his heels, the next president is itching to get down to business. Our cover asks what that will mean for the world economy.
These first two ideas, a straw-haired tsunami and a twister with Trumpian features, focused on the sense of impending upheaval. However, if the wave looked too gentle, the twister was too destructive.
What is more, stock- and corporate-bond markets are delighted with the deregulation and tax cuts Mr Trump is promising for his second term. Our cover needed to be more upbeat.
The Bull of Wall Street wearing a MAGA hat was a depiction of market euphoria. A pledge to cut $2trn from the government’s annual budget is patently absurd, but judicious liberalisation could be benign. On day one the new administration could speed up planning, by accelerating the passage of legislation that is already in Congress. Mr Trump has also promised to free up artificial intelligence. The technology is immensely power-hungry. Just imagine if easier planning rules helped unleash a revolution.
But the bull cover went too far. The markets are mindful of the danger of inflation and cronyism. As The Economist has warned, a Trump presidency also comes with risks.
A spiky flagpole, topped by the Stars and Stripes, told the other side of the story. Mr Trump wants to deport millions of irregular migrants and impose tariffs of up to 60% on China and 10-20% on the rest of the world. This would be bad for growth. For example, the direct costs of mass deportation could, by one estimate, run to hundreds of billions of dollars. That does not include the economic burden of labour shortages and spiralling consumer prices. Roughly half of the workers on America’s farms have no legal status.
These risks are real, but we did not want a cover that ignored the potential for good news even before Mr Trump had taken office. One way to think about these two contradictory stories is that your view depends on whether you are in America or the rest of the world.
Portraying America as a separate planet beside Earth was one way to illustrate that divergence literally. Few countries are more insulated against trade shocks than America, with its large domestic market. Mr Trump has an old-fashioned regard for share prices as a barometer of success, and that could also limit the harm at home.
The rest of the world is a different matter. As America borrows, raises tariffs and grows, the dollar will strengthen. That will dampen trade. It will also lead to higher interest rates and a greater dollar-debt burden in developing countries. Places that Mr Trump accuses of taking advantage of America, including Mexico, Germany and China, are likely to become particular targets.
Up to this point, our cover ideas had oscillated between hope and disaster. We needed something that could embrace both.
We turned to the president’s favourite game. Since Mr Trump is creating a great deal of volatility, one sketch had him approaching the green beside a jagged chart. Another thought was to show his trundling buggy having strayed from the greensward onto a greenback.
These were promising, but Mr Trump has appeared on the cover for the past two issues. We wanted something fresh.
We liked a design showing Earth as a golf ball, about to be hit. One golf-mad colleague speculated that Mr Trump would be teed off to be teeing off with the old-fashioned club in our first depiction. So we gave him a gold one, a bit like the one he received from Abe Shinzo, the late Japanese prime minister, who knew how to flatter Mr Trump with a gift. We engraved this one with the number 47.
The question is whether growth or anti-growth will dominate. It will be resolved partly by necessity, as the hyperbole of stump speeches comes into contact with the messy reality of governing. Policies take so much effort to enact that the next administration will simply be unable to do everything all at once. Mr Trump will have to choose.
Leader: What’s about to hit the world economy?
Finance: The biggest losers from Trumponomics
Business: American companies are hoping for a tax bonanza. They may be disappointed