“Once again, we are the economic envy of the entire world.”
– President Donald J. Trump on the GDP reaching 4.1 percent
President Trump said he “inherited a mess” courtesy of Barack HUSSEIN Obama…and he did both on the foreign policy and the economic policy front. And while we know what a disaster Obama was foreign policy wise, his supporters to this day still want us to believe that it was Obama’s handling of the economy then that has allowed the economy under Trump to soar now. But that is simply not true for during the Obama years while he was busy raising havoc in the Middle East and tying our military’s hands behind their backs, the GDP hit a low of 1.6% growth in 2011 to a high of just under 2.9% growth in 2015, then falling back down to 1.5% by the time Trump took office.
But last Friday the Commerce Department reported that the nation’s economy surged in the April-June quarter to an annual growth rate of 4.1 percent…nearly double the 2.2 percent growth rate in the first quarter. Tremendous numbers indeed fueled on by consumer spending and exporters hurrying to get their products delivered before certain tariffs took effect. And that 4.1% number reflects the best year of growth in well over a decade…and it’s especially noteworthy when it’s been accomplished in but a year and a half into the Trump administration.
And to the Democrats chagrin that number has nothing to do with Obama and has everything to do with Trump’s radical changes in America’s economic policies…policies which helped folks to open up new businesses thus allowing more jobs to be created which in turn led to an increase in consumer spending…and it’s spending that accounts for 70 percent of all economic activity.
And it’s important to remember that the GDP and jobs are forever tied together as consumption is the strongest indicator of economic growth and true economic growth cannot happen if people don’t have jobs along with the corresponding income by which to be able to buy…or to consume…products. And while most of those of the liberal persuasion believe that an increased demand for goods and services can come from greater government spending alone, without the dollars in one’s pocket to buy what’s demanded in no way equates into being able to purchase what’s demanded, therefore economic growth remains stagnant at best. In fact, demanding without purchasing power actually highlights the disparage between the so-called have and the have nots.
When he first became head of the Treasury Department, Treasury Secretary Steven Mnuchin said that Obama’s economic policies were to blame for the slower-than-normal growth the U.S. had experienced since the financial crisis of 2008. Well not only was he right about Obama’s economic policies and his out of control government spending being a serious “economic dislocation” from reality, but that said policies were the direct cause of economic growth being below potential which resulting in a disproportionately high number of folks unemployed especially in the African-American and Hispanic communities.
And it’s President Trump’s economic policies that have turned that “dislocation” around. Business investments have gone way up thus leading directly to more new businesses being created and new jobs opening up, which in turn aided both blacks and Hispanics looking for work. In fact, since Donald Trump has become president the African-American community has seen its previously double-digit unemployment rate fall to 6.8 percent… the lowest ever recorded…with the Hispanic community seeing its unemployment rate dropping a full point from 5.9 percent to 4.9 percent…meaning the Hispanic numbers are close to its lowest level since recorded job histories for both communities started in 1972 and 1973 respectively.
But Democrats, the likes of Nancy Pelosi and Debby Wasserman Schultz, still to this day relish in mocking what became known as Trump’s ‘Tax Cuts and Jobs Act of 2017’ as being mere “crumbs” in worker’s pocket’s. Imagine…to Democrats a $1.5 billion tax cut is “crumbs,” but if they truly want to see what “crumbs” look like they just need to remember back to Obama’s so-called “stimulus package”…a package that did next to nothing to stimulate economic growth or to create desperately needed jobs. And while unemployment numbers at times did drop a bit while Obama was in office, it surely was not because of the “stimulus” but because more workers stopped looking for jobs than there were jobs actually created. But now thanks to President Trump there are across the board more jobs being available than there are folks looking for work.
And yet the Democrats still refuse to give Trump’s economic policies credit for the solid economic gains we now as a country are experiencing, including the rise in dollars in our weekly paychecks along with the lowering of taxes. And both of these benefits, which specifically aided the middle class, helped to raise the GDP which currently stands at the a fore mentioned 4.1 percent with some economic indicators…one being business cycles…projecting it to go even higher in the second half of this year. But to fully understand how we reached that amazing 4.1 percent mark and before I tell you about the economic naysayers, let’s first have a little economics 101 rehash.
Briefly, the GDP…the Gross Domestic Product…is the total market value of the goods and services produced within these United States in a given year as well as its being one of the prime indicators gauging the “economic health” of our country’s economy. And it’s the GDP which helps set the pace for how economic growth affects jobs, businesses, and investments and visa-versa for each affects the other equally. Bad jobs numbers coupled with both low business investments and low business creation numbers brings down the GDP as much as good numbers…as of June the unemployment number was but 4 percent…raises the GDP, which is happening now. And when the number of exports vs. the number of imports is factored in, Trump’s bringing companies back to America with his slashing of overburdening tax regulations contributed greatly to the GDP reaching 4.1 percent.
And it’s not just the GDP number that proves Trump’s economic policies regarding trade, taxes, and other economic related issues are indeed working but also the fact that the narrowing trade deficit (to a tune of a $50 billion reduction) is evidence that his tariffs and other “get-tough policies” are generating the results he said they would. And not to be forgotten is that overall business investment grew at a solid 7.3 percent rate in the second quarter while government spending posted a 2.1 percent rate thanks to a budget deal that added billions to defense and domestic spending.
And let’s not forget the other all-important indicators that our economy is on the rise as in actual labor market data (the “real” jobs numbers); the overall yet still underrated positive performance of the stock market; the relatively low inflation rate of 1.9 percent; the fact that exports rose at a 9.3 percent rate while imports grew at but a lowly 0.5 percent rate; and that trade deals continue to be reached especially in regards to the all-important energy sector…giving hope that the United States will soon become a key energy exporter.
“High rates of growth, and the productivity that drives it, are likely distant memories from a bygone era.” So said Bill Gross of the Janus Capital Investment Group.
And while most on the right relish in all the good economic news as they know well that a strong GDP is paramount to the economic success of we everyday Americans as it directly impacts our standard of living while increasing tax revenues without the burden of tax hikes…what of the Democrat naysayers who say this growth cannot and will not be sustained in the long run.
First, it must be remembered that these folks have short memories for they chose to forget that during Obama’s 8-years in office the economic growth rate was on average a sub-par 1.5 percent during his first term and 2.1 percent during his second term…basically just a stagnant economy.
And the Obama years also saw growth in the labor force being less than half the rate of the previous four presidencies (62.8 percent compared to 67.1 percent in the late 1990s) with wages…what’s referred to as “real compensation per hour”…for the most part also being stagnant growing at but 0.6 percent which is well below the 1.1 percent annual average of the preceding administrations. And then there’s the annual growth in labor productivity (output per hour worked) being 0.9 percent during the Obama years, less than half the rate of the previous period…as in the George W. Bush years. And all this added to the GDP under Obama never reaching even 3 percent…which would have equated into a modest but respectful gain…with some economists now saying with Obama as president our country saw the worst economy since the Great Depression.
Now as for the naysayers…let’s start with but three economists beginning with Larry Summers who was Director of the National Economic Council under Obama, who said when Trump’s preliminary budget originally forecast a 3 percent economic growth, that it was, “Fair enough if you believe in Tooth-Fairies.” Then there’s Maya MacGuineas, President of the Committee for A Responsible Federal Budget, who said that Trump’s 3 percent prediction was nothing but “wishful thinking and fuzzy math.” And lastly, Robert Brusca, senior economist at FAO Economics stated that, “No, pigs do not fly…’Donald Trump is dreaming.” I wonder what these three economists say now.
And as for Democrat politicians who actually want both America and Trump to fail…Senate Minority Leader Chuck Schumer said of both the Treasury analysis and President Trump’s original 3 percent growth prediction as being “nothing more than one page of fake math.” And House Minority Leader Nancy Pelosi was in full meltdown mode as she tried to downplay the 4.1 GDP by trying to pass it off as nothing but more “crumbs.” Not even expecting the GDP to reach the projected 3 percent, Pelosi tweeted out, “For 18 months, @realDonaldTrump has put the interests of wealthy Americans over working people. Today is no different. Important fact he refuses to acknowledge? He’s presided over a drop in the real wages of American workers.” Well at least Pelosi gets that jobs are tied into the GDP…clueless wonder that she is.
And Rep. Ted Lieu (D-CA) sent out his own tweet saying that, “You can believe in MATH or you can believe in the #TrumpBudget. You cannot do both.” Well not only do I beg to differ but a 4.1 GDP proves that you indeed can do both.
So the bottom line is this, and bygone eras be damned, $7 trillion dollars has been added to the economy thanks to President Trump’s economic policies culminating in the GDP reaching 4.1 percent; the Democrats as expected are cringing at the thought that Trump succeeded where Obama failed; and ‘We the People’ are not yet tied of winning…with even more winning surely to come.
Copyright @ 2018 Diane Sori / The Patriot Factor / All Rights Reserved.
For more political commentary please visit my RIGHT SIDE PATRIOTS partner Craig Andresen’s blog The National Patriot to read his latest article Socialism 101 and the Ultimate Irony
By: Diane Sori / The Patriot Factor / Right Side Patriots on American Political Radio
Today, Tuesday, July 31st from 7 to 9pm EST on American Political Radio, RIGHT SIDE PATRIOTS Craig Andresen and Diane Sori discuss ‘Winning…Courtesy of a 4.1% GPD’; ‘Socialism 101and the Ultimate Irony’; and important news of the day.
Hope you can tune in at: http://listen.samcloud.com/w/73891/American-Political-Radio#history