IBD Editorial, 9/11/18

Growth:

Barack Obama is on the road attempting to claim credit for the booming economy under President Trump. But the only thing Obama deserves credit for is making it easy for Trump to undo Obama's anti-growth policies.

Let's see if we have this right. For eight years, President Obama presided over the worst economic recovery in modern times. For six years, he blamed Republicans in Congress for thwarting his spending agenda and hampering growth. In his last two years in office, he claimed that 2% growth was the best we could hope for. And in his last year in office, while the economy was again stalling out, Obama claimed that Trump's tax cuts and deregulation would only make things worse.

But now that we're in the midst of a booming economy — which kicked in after Trump reversed almost all Obama's economic policies — we're supposed to believe that it's Obama who deserves all the credit.

Yep. That's precisely what Obama and his Amen Chorus in the press want us to believe.

In his speech in Illinois last Friday, Obama complained that Republicans were taking credit for his work.

"When you hear how great the economy's doing right now, let's just remember when this recovery started," he said. "I mean, I'm glad it's continued, but … suddenly Republicans are saying it's a miracle."

This week, White House Council of Economic Advisers Chairman Kevin Hassett wisely set the record straight. At a briefing on Monday, he noted that just about every important economic indicator showed the economy was stalling out in Obama's last year.

Hassett explained that small business optimism had been on the decline before the November 2016 election. The percentage of businesses saying it's a good time to expand was, too. Business investment was stagnant. All those turned upward starting in 2017. Applications for new businesses are now well above the trend over Obama's entire second term, Hassett noted. And blue-collar jobs are growing faster than any time since the Reagan administration.

Turnaround on GDP Growth

There's more. The rate of GDP growth was decelerating in Obama's last year. It went from 2.3% in Q2, to 1.9% in Q3 to 1.8% in Q4 of 2016. Under Trump, GDP growth has averaged 2.9%. It was 4.2% last quarter and might be higher in the current one.

The stock market also was stuck in neutral the year before the November 2016 elections. The Dow is up by some 45% since then.

Real median family income didn't budge from August 2015 to November 2016, according to Sentier Research. It's up more than 4% since Trump came into office. Wages are on the upswing.

In Obama's last year, unemployment rate remained basically unchanged — it was 4.9% in Jan 2016, and 4.8% when Trump took office in Jan. 2017. Now it's down to 3.9%

We could go on.

Meanwhile, the same reporters now patting Obama on the back for today's strong economy were reporting in late 2016 about how — as The New York Times put it — "the underlying reality of low growth will haunt whoever wins the White House."

Scientific Consensus

Still not convinced Trump deserves credit for the current booming economy? Consider that a survey of 68 business, financial and academic economists by The Wall Street Journal at the start of this year found that most believed Trump's policies would boost the economy, while the same group had said Obama's policies were a drag on long-term growth. Ninety percent said Trump's tax cuts would accelerate growth.

It is what the left would, in another context, call a "scientific consensus."

Yet to listen to liberal activists and the ideological press and you'd think that Trump was crazy for claiming credit for today's growth. "The economic expansion we're enjoying today was set in motion under Obama," insists Slate's Jordan Weissmann.

Doesn't this make people like Obama and Weissmann "economy deniers?"

https://www.investors.com/politics/edito...ooming-economy/