Adam Davidson, in his New York Times article entitled “What Donald Trump Doesn’t Understand About ‘the Deal’”, argues that Donald Trump can be seen as a canny spokesman for a unique sort of economy: rent seeking. We obviously learned in class that rent-seeking is when resources are spent in order to obtain rents which derive from some activity that has negative social value (DWL). Davidson presents the case that Trump’s vision completely matches what rent-seeking behavior is all about. Trump isn’t just a rent-seeker himself based on his rent-seeking behavior to exploit monopoly power in his real estate business in up-state New York; “his whole worldview is based on a rent-seeking vision of the economy, in which there’s a fixed amount of wealth that can only be redistributed, never grow.”
Trump essentially embraces rent-seeking behavior by grabbing more than his share by “cutting deals” as a New York real estate tycoon. Many economists and political scientists think that a higher proportion of the economy comes from rents. There is a wide array of economists of different political biases that agree that reducing rent-seeking behavior is essential to improving overall growth and making “America Great Again.” However, the descent into a rentier economy would only accelerate with a mentality like Trump’s in the White House. Thus, there’s the irony: will Trump actually make “America Great Again”, or will he perpetuate further economic inefficiency and rent-seeking behavior?
