Trump hit the office running, and his official pen has been busy signing memos and executive orders. One of the first orders with the largest potential to change the economy came in a memo that froze federal hiring. While liberals have decried this move as an assault on liberty, it is actually a calculated and clever way to get a head start on fixing the federal budget and keeping some of Trump’s largest promises.
Attacking the Deficit
The most obvious impact of this move is that it largely mitigates major deficit increases. While Congress has plenty of opportunity to push changes that could increase the deficit over the year, Trump has virtually eliminated subtle debt increases without additional, deliberate action.
At this point, it is impossible to say how long the freeze will last, but it stems the flow of money and enables Trump’s team the time they need to do a proper audit of the federal workforce. When Obama inherited the White House in 2008, there were roughly 1.8 million workers under his domain. During his tenure, that number rose to 2.1 million, a 15 percent increase.
At minimum, Trump wants to slow that rate of increase in order to better control spending. This move alone doesn’t exactly trim the fat, but it enables the administration to move forward on that promise with a clearer picture of how spending will proceed.
The Political Picture
More important than the freeze itself is the message it sends. Trump is acting early and ambitiously to show how serious he was about campaign promises. The hiring freeze doesn’t shut down government work, but it puts pressure on Congress to get to work on a better budget.
It also makes it very clear to both parties where Trump stands. This maneuver essentially throws the ball to Congressional Republicans, and if they get in line, a revised budget could easily be written and approved before midterm elections in two years.
This is one of the most important steps in draining the swamp and improving federal money management to stimulate the economy and reduce government bloat.
It’s also important to note that the freeze is not a flat ban on all hiring. Such a mandate would actually be reckless, and the Trump team has acknowledged that. Military hiring is being completely untouched, and any position that is deemed essential to national safety and security, in any office, can still be approved for hiring.
This has two important impacts. First, it mitigates the immediate economic impact. Until a new budget is approved, money saved on the hiring freeze will mostly sit stagnant and not re-enter the economy. Since military and security hiring represents a minimum of one-third of federal positions, it prevents an excessive amount of money from leaving the economy at once.
The second and more important impact is that it does not impede the government’s primary function. The attack on the budget does not come at the price of security, and it does not create a weak point for foreign opposition to exploit. That will be doubly important as Trump enters into international trade agreements.
The big question, of course, is how will this impact the economy tomorrow? Many factors that answer that question are still in the air. We don’t know when, or if the freeze will be lifted, and we don’t know what the final revised budget will look like.
What we do know, though, is that this creates an opportunity to downsize the government in general. It pushes federal jobs back into the private sector, and countless research has shown that private employment is much better for economic growth.
The other interesting effect is that it will reduce over-regulation. While Trump will certainly lead an attack against excessive oversight, it’s impossible for his administration to hit every front. The hiring freeze stops expansion, and any disruptive regulation that doesn’t get reformed will still be operating with limited staff.
This means that any offices that aren’t intentionally supported, such as the EPA, will lose some of their enforcement power in the long run, and this will ease the burden of regulation across the country.
Ultimately, this is a small move. It is also the beginning of big change. It shows that Trump is a man of his word and willing to take aggressive action. While the freeze alone won’t accomplish the wider goals, it is an important first step, and it has been executed in a way that is healthiest for the economy.
~ Facts Not Memes