White House chief of staff Mick Mulvaney warns Republican donors of a possible 'moderate and short' recession

Jonathan Ernst/Reuters

President Donald Trump and Mick Mulvaney

• White House chief of staff Mick Mulvaney warned Republican donors at a fundraiser in Jackson Hole, Wyoming this week that the US may fall into a "moderate and short" recession, Politico reported.
• This private message contradicts senior administration officials' public claims that the US economy remains strong. 
• Trump called a potential recession "irrelevant" on Tuesday because his trade war with China is more important in the long term.
• The administration is considering reversing some of Trump's tariffs on China, cutting payroll and corporate taxes, and indexing capital gains taxes to inflation as ways to boost the economy. 
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White House chief of staff Mick Mulvaney warned about 50 Republican donors at a private fundraiser in Jackson Hole, Wyoming this week that the US may fall into a "moderate and short" recession, an attendee told Politico on Wednesday.

This private message contradicts senior administration officials' public claims that the US economy remains strong. 

Trump called a potential recession "irrelevant" on Tuesday because his trade war with China is more important in the long term. He also suggested that a recession, generally defined as two consecutive quarters of contracting economic output, could last for just two months. 

Read more: Trump is reportedly so worried about the threat of recession he's considering reversing some of his signature China tariffs

"Whether it's good or bad, the short term is irrelevant. We have to solve the problem with China because they're taking out $500 billion a year plus," Trump said, adding, "I am doing this whether it's good or bad for your statement about, 'Oh, will we fall into a recession for two months?' The fact is, somebody had to take China on."

But the Trump administration is considering reversing some of Trump's tariffs on China as one way to help protect the US economy from falling into a recession, The New York Times reported Monday.

Read more: Trump is pushing to let Russia re-join the G7, and the White House claims that France approves

The administration is also considering payroll tax cuts, corporate tax cuts, and indexing capital gains taxes to inflation as ways to boost the economy. 

"I've been thinking about payroll taxes for a long time," Trump said on Tuesday. "Whether or not we do it now or not is - it's not being done because of recession."

Meanwhile, the administration has continued to push the public message that the economy is strong. Trump recently attacked the media and Democrats for allegedly misrepresenting economic data to encourage a recession and hurt his chances of reelection. 

"Despite the irresponsible rhetoric of many in the mainstream media, the American economy is strong, and the U.S. economic outlook remains strong as well," Vice President Mike Pence said on Monday in Detroit. "Last week, despite some volatility in global markets, leading retailers also reported strong sales and earnings, and consumer spending posted its strongest reading since March."