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Economic Reprisal

October 5, 2020

The campaign season getting into its final stretch, pundits will say more and more about the economy. Much of it nonsense. The US enjoyed eleven years of steady economic expansion from the financial crisis until the Covid-19 pandemic. The first graph shows real GDP. Like the other graphs here, it was grabbed from my friend Fred, and runs from 2001, because a little history always provides context for current economic data.

Private sector employment may be second only to GDP as a basic vital sign of the economy. It is shown in the second graph. Like GDP, it shows steady growth during the expansion.

Trump cheerleaders often write as if the economy did horribly under Obama, and then Trump came in and turned it around. If you look at the actual data, the financial crisis mattered, and the current pandemic mattered. You will find it difficult to find any inflections in these graphs where the current president mattered.

This morning, one respondent was boasting that Trump had been the best president ever for blacks, because he had raised their employment. Presumably, unlike presidents past. The graph for black employment is shown third. While it is true it did not take off like general employment right after the financial crisis, it shows a steady rise from 2011, with no significant change in that trend after 2017.

But surely manufacturing employment — a key part of Trump’s first campaign — was one area where he made a difference? It is the last graph. Again, the data shows otherwise. 

It is true, of  course, that GDP and employment and the stock market all hit new highs while Trump was president. Just as they had while Obama was president. Just as they have for most presidents, and will for presidents to come. A president who speaks as if he did something special because economic growth continued also while he was in office likely will deceive you also about other things. 

The story isn’t yet done with the current inflection in the economy, and whether it shows nothing but a blip due to the pandemic, or whether that  will expose deeper economic issues. It will be a while yet before we know that. 

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