The Bureau of Economic Analysis announced that the economy closed out the final quarter of the year with a 2.1% growth rate. That figure, in isolation, is only modestly impressive, but it’s clear that across every topline metric and trendline, we have the best economy in well over a generation.
The fourth quarter of 2019 barely beat the 2.0% expectation of growth, and at 2.3%, the year’s total GDP growth was the lowest of Donald Trump’s presidency so far. Naysayers were quick to pounce on the figure — Christine Romans of CNN Business claimed that “the Trump Economy is looking a lot like the Obama Recovery.”
This is true in the most literal and sophomoric of senses. Barack Obama inherited an economy with nowhere to go but up, and what followed was the slowest recovery since World War II. President Trump inherited an economy theoretically overdue for a recession and already returned to what economists considered full employment. Yet its growth rate has increased on his watch, unemployment has fallen to its lowest rate in half a century, and this is happening as more workers come back into the labor force. On Wall Street, the Trump era has extended the longest bull market in history, with stocks at record highs.
So when the likes of Joe Scarborough try to compare Trump’s economic growth after a decade of expansion to Jimmy Carter’s after a recession and stagflation, it completely misses the overall picture of the economy and all the ways it’s surpassed what we thought was even possible in many metrics.
It’s not that everything is peachy. Bipartisan consensus on blowout spending has culminated in annual trillion dollar deficits indefinitely and a debt-to-GDP ratio that will likely reach 100% in the next decade and 180% in the next 30 years. The dangerously dovish monetary policy championed by both Trump and Obama also poses a risk that some of the past decade’s growth has been artificial and that the Federal Reserve will be impotent in case of another recession. And Trump’s trade war has certainly hampered what our economic growth could be.
But the economy has refused to stop growing while avoiding overheating and instigated inflation. The stock market, in which 55% of the country has a stake, continues to catapult to record highs. The labor market is so tight that not only have employers been forced to pluck three-quarters of new workers from outside of the labor force, but real wage growth has disproportionately benefited the lowest-earning workers.
The economy is working for workers, and they know it. The country’s economic confidence has reached its highest point since 2000, and more than two-thirds of the nation report being satisfied with the state of the economy, a 22-point increase since the start of Trump’s presidency.
There’s no question that Congress has to buck up and deal with the the entitlements that are fueling our gruesome mandatory spending. And Trump is not the sole architect of our economic boom. But there’s no denying that it is a boom and that it is benefiting those who need it the most. Those who predicted doom and gloom as a result of Trump’s mismanagement were obviously wrong and ought to admit it.
