President Trump likes to say that the economy is flourishing under his administration. While that may be true, guess who deserves the credit…
Consider the monthly jobs statistics–the total monthly Non-Farm job growth (seasonally adjusted) as reported by the Bureau of Labor Statistics. Under Donald Trump jobs creation is very good, but no better than during President Obama’s second term. Recall that the good jobs reports were often scoffed at by then candidate Trump as fake, but those same BLS jobs reports were later touted by Sean Spicer and President Trump.
Similarly, President Trump talks about the great GDP performance during his first term, but it peaks at a level far lower than the best quarter during President Obama’s second term (source: Bureau of Economic Analysis, US Department of Commerce).
The only metric where the Trump economic performance excels is the stock market. But that does not reflect a healthy economy, but rather an expectation of higher corporate profits. That expectation was proven correct with the passage of the Republican corporate tax cut.
The record stock market prices are also driven by low interest rates. When interest rates are low, people invest in the stock market because other investments have a lower rate of return. But the low interest rates are partially the result of President Trump pressuring the Federal Reserve to force interest rates low. The Fed accomplishes that by lending money at below market rates. That, in turn costs the federal government money, which when coupled with the tax cut without commensurate spending reductions, are forcing our national debt to record levels.
In addition, those tax cuts did not lead to commensurate investments in infrastructure. Much of that tax cut was spent by corporations to buy back outstanding stock, which increases the share value and helps the rich; but it does nothing for the common family which does not have large investments in the stock market.