President Donald Trump likes to think of himself as following the path of Andrew Jackson, president from 1829 to 1837. Jackson considered himself a defender of the common man against the elites of the early years of the new republic. Trump, however, is not a champion of the working class. Rather, he is a strong supporter of the business class and his family interests (witness his crypto investments).

Trump’s approach to government more closely resembles that of Franklin Delano Roosevelt’s administration. FDR was president from 1933 to 1945 during the Great Depression. While in office, Roosevelt tried to end the Depression and improve the economic position of the working class. Roosevelt, in effect, threw the kitchen sink at the economy and the government. FDR was the disruptor in chief. He created numerous government agencies, and he directly interfered in the economy. FDR allocated capital, most often poorly. Roosevelt’s policies were largely a failure. 

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By 1940, unemployment was still nearly 15%, and farm incomes remained well below 1929 levels. Throughout the 1930s, joblessness never fell below 20%. It was mobilization for World War II — not the New Deal — that finally ended the Great Depression.

And as with Roosevelt’s failed policies regarding the Depression, Trump will fail to end the trade deficit. Arguably, Roosevelt could have ameliorated the effects of the Depression by adhering to the principles of free market capitalism. Similarly, almost all economists agree that the way to end the trade deficit is to follow textbook economic policy. Stop the fiscal deficit of the federal government through higher taxes and entitlement reform. Unless Trump focuses on the fiscal deficit, like FDR, he will flail around and accomplish little. 

Trump, like Roosevelt, is interfering in important sectors of the economy. At the moment, Trump is trying to offer financial support to the agriculture industry, which is being harmed by his tariffs. China, traditionally a large purchaser of U.S. agricultural products, has dramatically reduced and, in some cases, stopped buying U.S. farm output. China is reacting against Trump’s tariffs. In the 1930s, FDR took money from one part of the agricultural sector and transferred it to other areas. By 1940, both farmers and farm workers were worse off.

Meanwhile, Trump’s One Big Beautiful Bill has swelled the federal deficit, driving up interest rates and mortgage costs. His tariffs on timber, wood products, and furniture have inflated construction costs, while his restrictive migration policies have created a shortage of building labor. The combined effect: higher prices for new and existing homes.

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Most egregiously, FDR supported state control of key industries. Trump is following a similar path. His government’s stakes in Intel, U.S. Steel, and certain natural resource companies will not end well. The profit motive will not determine the policies of these companies. Trump’s instincts, which are often emotive and wrong, will determine management decisions.

Both Roosevelt and Trump see disruption as proof of strength. Both distrust markets and overestimate the wisdom of government control. Yet, history offers a simple lesson: capitalism, for all its flaws, works — and state-directed capitalism does not.

James Rogan is a former U.S. foreign service officer who has worked in finance and law for 30 years. He writes a daily note on the markets, politics, and society. He can be followed on X and reached at [email protected].