WILSON’S LOCAL PRINT AND DIGITAL COMMUNITY INSTITUTION SINCE 1896

Trump’s economy more house of cards than powerhouse

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Often, political letters are full of bravado, name-calling and absurd claims. Bill Biddle’s letter (“Dems protest patriotic speech, high-octane economy,” Feb. 12) is an example.

Biddle wrote, “the Democrats’ problem is that they are frustrated by the accomplishments of Trump in three years.”

What are Trump’s accomplishments? We have the lowest unemployment rates in almost 50 years. The stock market is at all-time highs. The economy is growing about 2.3% annually, in line with recent rates, though well below the 3, 4, 5 or 6% annual growth President Trump promised when he cut taxes. Yet, economic optimism is the highest since 2004. President Trump boasts that “our economy is the best it has ever been.” Yet, many economic indicators lag that of the Obama presidency, and the growth and size of the national debt ought to concern us all.

Under President Trump, the S&P is up about 49%, not bad, though significantly behind Obama’s 68% increase in his first 36 ½ months. During Obama’s eight years, the S&P 500 rose 235%.

About 7 million jobs were created under President Trump so far, but again this trails the 8 million jobs created in the last 35 months of the Obama administration.

The national debt is soaring under President Trump. It also soared under Obama, but the key difference is that Trump is adding massive amounts of debt in a strong economy, whereas Obama’s deficit spending helped pull us out of the worst financial crisis in 70 years. As candidate Trump remarked in 2016, “we’ve got to get rid of the $19 trillion in debt…I would say over a period of eight years.”

It stood at $19.9 trillion when Trump took office; the debt is now about $23.3 trillion and headed to $24 trillion before the 2020 election.

Debt interest payments are now more than $1 billion a day and growing rapidly. $23 trillion in debt amounts to $179,000 per U.S. household or $70,000 per person. The national debt is now roughly the size of the combined economies of China, Japan and Germany.

Republicans say they care about the debt and deficits, but are now silent. Obama’s deficits in his last four years averaged $547 billion compared to Trump’s fiscal year 2019 deficit of $1.109 trillion and estimated FY 2020 deficit of $966 million to $1.103 trillion.

Trump’s response to the debt: “just run the presses — print money.”

“If the government prints too much money,” Warren Buffet’s Vice Chairman Charlie Munger recently said, “ it ends up like Venezuela.”

Living on borrowed money can create optimism and euphoria, at least until the bill comes due.

Dail Turner

Wilson

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