More jobs were created during Obama’s last 21 months than in Trump’s first 21 months
Republicans are busy crowing about the economic numbers that were released last Friday. However, they have been doing so using false comparisons. They have been comparing Trump’s first 21 months in office, when he inherited a strong economy, to all of Obama’s Presidency, when Obama inherited an economy in absolute free fall.
Here is the economy Obama inherited when he took office in January 2009:
The International Monetary Fund concluded that the overall impact was the most severe since the Great Depression in the 1930s. The Great Recession stemmed from collapse of the United States real-estate market, in relation to the financial crisis of 2007 to 2008 and U.S. subprime mortgage crisis of 2007 to 2009, though policies of other nations contributed also. According to the U.S. National Bureau of Economic Research (the official arbiter of U.S. recessions) the US recession began in December 2007 and ended in June 2009, thus extending over 19 months. The Great Recession resulted in the scarcity of valuable assets in the market economy and the collapse of the financial sector (banks) in the world economy.
Here is the economy Trump inherited when he took office in January 2017:
The president is handing his successor an economy that’s now the envy of the world.
On the campaign trail, Donald Trump repeatedly described the U.S. economy as a hollowed-out disaster of high unemployment and stagnant growth.
But the latest numbers show the president-elect will in fact inherit a fairly robust economy with the lowest jobless rate in nearly a decade, record home and stock prices and a healthy growth rate.
It’s a radically different position from the one President-elect Barack Obama found himself in 2008 with markets crashing, the financial crisis spinning out of control and joblessness headed toward 10 percent.
Trump instead will take office with an economy near full employment and wages and spending rising. The economy is in such strong shape that the Federal Reserve is likely to raise interest rates again later this month to try and cool things off.
“President-elect Trump will inherit a much stronger economy than his predecessor did,” Standard & Poor’s economists said this week. “Largely forgotten in all the rhetoric and fanfare of the campaign is the fact that data show the world’s largest economy continuing to expand at a reasonably good pace.”
In fact, the economy that Trump inherited was accomplishing something at a greater pace than the economy Trump has now been presiding over: creating jobs.
In the first 21 months of Trump’s Presidency, 4,054,000 jobs have been created, an average of 193,000 per month.
In the preceding 21 months, when Obama was President, 4,477,000 jobs were created, an average of 213,000 per month.
What has Trump done for the economy? Not much, really. The economy is creating less jobs than it was before Trump took office.
Wage growth has been continuing on the same pace it was before.
Even the manufacturing jobs Trump likes to brag about aren’t showing any difference from the trend that has existed since 2010 under Obama.
About the only noticeable difference in the economy under Trump has been that corporations received a massive tax cut, and they’ve been using that tax savings to buy more of their own stock, benefiting their shareholders, who are mostly the already wealthy (The Richest 10% of Americans Now Own 84% of All Stocks).
Over the past 12 months, we estimate the value of share buybacks to be USD 640 billion, 30% higher than that of the previous 12 months[ii]. For the full year 2018, buybacks could even increase by over 40% compared to 2017 and exceed USD 800 billion. For 2019, Goldman Sachs estimates that buybacks should increase by over 20% to a new all-time high of almost USD 1 trillion[iii]. These colossal amounts are all the more significant as companies are expected to deploy the greatest proportion of their cash this year and in 2019 for share buybacks (more than for capex) for the first time since 2007. With cash-to-asset ratios close to their all-time highs of 12%, US companies have ample means to launch ambitious share buyback programmes.
And what has the country gotten for those massive stock buybacks that were fueled by the GOP tax cut? A skyrocketing deficit.
The Federal budget deficit is now $779 billion, the highest its been since 2012, when the deficit topped $1 trillion.
Which the Republicans want to use as an excuse to cut Social Security, Medicare, and Medicaid.
Senate Majority Leader Mitch McConnell on Tuesday blamed rising federal deficits and debt on a bipartisan unwillingness to contain spending on Medicare, Medicaid and Social Security, and said he sees little chance of a major deficit reduction deal while Republicans control Congress and the White House.
This is the real story of Trump’s economy: good numbers that were inherited from Obama, an enormous tax giveaway to corporations that corporations used to enrich their wealthy shareholders, and a skyrocketing federal deficit that Republicans want to use as an excuse to cut Social Security, Medicare, and Medicaid.