The rift in the lute has widened further and it is palpable enough that the Trump administration has been further weakened by the resignation of Gary Cohn, the US President’s top economic adviser.
There are two compelling factors behind the development, societal as well as economic. In almost equal measure, both issues have brought the present dispensation under a cloud, not to forget the Russian meddling in the elections.
Cohn, it bears recall, had threatened to resign over Trump’s decidedly incendiary remarks in the aftermath of the race riot in Charlottesville, Virginia.
And when he put in his papers last Tuesday night as the head of the National Economic Council, he had bared his angst against the President’s decision to impose tariffs on steel and aluminium imports and thus lend an impetus to his policy of protectionism.
Cohn’s resignation has served to buttress the vehement opposition to the tariffs, as already articulated by the Treasury Secretary, Steven Mnuchin.
Pretty obvious, therefore, are the differences over the economic measure within the Republican establishment, and its impact on the White House.
In the immediate perspective, the resignation has been resonant in the echo chambers of the share market and the economy in general.
Futures trading pointed to a sharp 1.6 per cent drop in shares on Wall Street as investors reacted to the exit of the pro-free trade adviser.
The dollar dropped against the yen in the Asian markets, but recovered the lost ground as the day progressed. Shares in Asia Pacific had also dipped the day after Cohn’s resignation.
In Japan, where the steel industry is likely to be badly affected by tariffs, the Nikkei closed down 0.77 per cent. Hong Kong and Sydney were both down one per cent. It is not often that the resignation of an Administration official has a trans-Atlantic impact and almost immediately. Cohn’s exit definitely has.
In the aftermath of the setback, Trump has been remarkably gracious in acknowledging the contribution of the key economist of the White House ~ “Gary has been my chief economic adviser and did a superb job in driving our agenda, helping to deliver historic tax cuts and reforms and unleashing the American economy once again.”
For all that, there is today a parting of the ways. Cohn’s departure represents another blow to the administration, which has suffered several high-profile resignations since Trump’s inaugural in January 2017.
Hope Hicks, Trump’s close aide and communications director, quit last week, and other senior figures to have left include Trump’s former chief of staff, Reince Priebus, and former chief strategist, Steve Bannon.
But the resignation of Cohn, a former chief operating officer at Goldman Sachs, could be the most significant. It comes after global markets were roiled by Trump’s decision to impose tariffs on trading allies. The President needs to reflect on his economic policy.