JP Morgan Chase CEO Jamie Dimon told shareholders Tuesday many of the problems facing America today “have been self-inflicted,” echoing comments not unlike those typical of President Donald Trump.
“America is probably stronger than ever before,” he said in an annual letter, before laying out many of the problems facing the country. He listed strengths of the country, including a stable system of law and order, a long-standing vibrant democracy and a hard working populous, but then shifted gears with an almost ominous statement. “It is clear something is wrong — And it’s holding us back.”
The executive started sounding very similar to Trump on a few points: military spending, tax reform, infrastructure and the frustration felt by many Americans who are struggling economically.
Trump has suggested that the U.S. frivolously spent trillions of dollars fighting wars in Iraq and Afghanistan, Dimon also decried the amount of money spent funding our military endeavors in the Middle East. “Over the last 16 years, we have spent trillions of dollars on wars when we could have been investing that money productively,” he wrote.
Trump has repeatedly promised to overhaul the U.S. tax code, which he believes cripples business and is causing companies to leave “our country rapidly.” “The unfairness of the tax laws is unbelievable,” Trump said at a campaign rally in Colorado in October, 2016. He plans to drastically slash the corporate tax rate and massively deregulate the economy to promote new business investment and growth. (RELATED: A Comprehensive Look At Trump’s Tax Plan)
Dimon agreed in the letter, writing that the exorbitant U.S. corporate tax rate, one of the highest in the world, is “causing” our nation “considerable damage.” As a result of the high corporate tax rate, “American corporations are generally better off investing their capital overseas, where they can earn a higher return because of lower taxes,” he wrote.
It isn’t just American businesses that are hurting from the tax system, consumers are taking a hit as well, according to Dimon. “One of the unintended consequences of high corporate taxes is that they actually depress wages in the United States,” Dimon wrote. “We must fix this for the benefit of American competitiveness and all Americans.” In line with Trump, Dimon believes reducing the corporate taxes would “incentivize business and investment.”
The president and Dimon are also apparently on the same page regarding the pressing need for infrastructure improvements. “On infrastructure, the United States is behind most major developed countries, including the United Kingdom, France and Korea,” Dimon wrote. The executive points out the U.S. has not built a major airport in over two decades, while China has “built 75 new civilian airports in the last 10 years alone.”
Likely to Dimon’s approval, Trump pledged Tuesday to spend up to $1 trillion rebuilding American roads, bridges and tunnels. (RELATED: Trump Pledges To Spend Up To $1 Trillion On Infrastructure)
Dimon believes Americans are right to be angry, after getting left behind by the business and political elite. He used the examples of government-backed student loans and the lack of economic opportunity to make his point.
“It is understandable why so many are angry at the leaders of America’s institutions, including businesses, schools and governments –they are right to expect us to do a better job,” Dimon wrote. “This can understandably lead to disenchantment with trade, globalization and even our free enterprise system, which for so many people seems not to have worked.”
Dimon differs from Trump, however, in his views on international trade. The biggest “global risk” facing JP Morgan is the anti-free trade message pushed by the president and his affiliates, he said, a message that is gaining traction not only in the U.S. but around the globe.
“De-globalization, Mexico and China. Anti-globalization sentiment is growing in parts of the world today, usually expressing itself in anti-trade and anti-immigration positions,” he wrote.
To get back on track, we need to rebuild “trust and confidence in our institutions,” he wrote. Confidence in our system will be the “secret sauce” that will help our economy grow.
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