U.S. Politics

Trump inherits Obama boom

http://bcove.me/fja9zv0x

POLITICO

The president is handing his successor an economy that’s now the envy of the world.

NEW YORK — 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.”

The recent gains are now allowing outgoing Obama officials to take something of a victory lap as they head out the door.

“I’ve been here eight years and it is really exciting to see that number, 4.6 percent. I didn’t think I’d ever see the unemployment rate that low,” Jason Furman, chairman of Obama’s Council of Economic Advisers, told CNBC on Friday. “It’s fallen more than half. It’s because we’ve just created these steady jobs, month after month, 15.6 million of them in the private sector.”

The latest positive news came Friday, with the government reporting a gain of 178,000 jobs in November and the jobless rate falling to 4.6 percent, the lowest level since August 2007.

Some of the drop came from a decline in the size of the labor force. But the trend in the labor force has been up. Wages ticked down slightly in November after a large gain in October. But take-home pay is now rising at a solid annual rate of 2.5 percent.

And other major economic indicators are rising fast.

U.S. house prices this week hit new record highs, finally erasing the steep declines following the financial crisis. The Dow Jones Industrial Average on Thursday closed at another record high, hitting 19,191. The Nasdaq and Standard & Poor’s 500 also hit records last month. Consumer spending and incomes are both rising at a solid pace.

“Between surging consumer confidence levels, a booming stock market and home prices back above pre-recession levels, a number of boxes indicative of a healthy economy are being checked off,” Bankrate.com senior economist Mark Hamrick said in a note on Friday.

Put together, the picture is radically different than the one painted by Trump on the campaign trail, where he railed repeatedly against the Obama economy. “We have no growth right now,” Trump said in August. “The country’s a disaster.”

On the campaign trail in February he suggested the government’s numbers were faked.

“Don’t believe those phony numbers when you hear 4.9 and 5 percent unemployment,” Trump said in his victory speech after the New Hampshire primary. “The number’s probably 28, 29, as high as 35. In fact, I even heard recently 42 percent.”

No figures ever backed up Trump’s claims of soaring joblessness and no growth. The economy grew at a 3.2 percent pace in the third quarter. It could slow down again in the final quarter of the year. But the pace of job growth remains quick enough to keep the jobless rate falling and wages rising as employers compete for a smaller share of available workers.

“The labor market is pretty healthy and it’s clearly growing enough to stabilize the jobless rate,” said Jim O’Sullivan of High Frequency Economics. “In fact it’s booming relative to our underlying demographics right now.”

Despite the strong overall numbers, the economy is far from perfect and Trump and other Republicans continue to focus on pockets of weakness — including in manufacturing states in the Rust Belt that delivered the GOP nominee his stunning Electoral College victory last month despite losing the popular vote by over 2 million.

The November jobs report showed manufacturing employment declining for the fourth month in a row. Workers without at least a high school diploma continue to suffer far higher jobless rates while the unemployment rate for those with a college degree or higher is just 2.3 percent. Productivity gains remain low and the U.S. corporate tax code continues to discourage companies from expanding domestically.

Trump went to Indiana on Thursday to tout a deal with Carrier to keep around 1,000 jobs in the state that were slated to move to Mexico. The deal reportedly offered $7 million in tax breaks to Carrier and the company still plans to move more than 1,000 jobs south of the border.

Still, Republicans say Trump’s plans for lower tax rates and fewer regulations will unleash even faster and more widespread growth and keep more jobs in the U.S. “We need to create more opportunities for all Americans,” House Ways and Means Committee Chairman Kevin Brady said in a statement after the jobs report. “For eight years, the American people have watched Washington focus on everything but jobs — and that’s about to change. I’m very pleased that the incoming Trump administration is already making it clear that job creation and economic growth are their top priorities.”

3 thoughts on “Trump inherits Obama boom

  1. Trump is who he is. He will push a cooperative legislature into cutting taxes, thereby lessening funds going into the federal treasury and blowing Obama’s 8 years of hard work to get the recovery going.
    He’s going to blame that on WHO? Obama? Democrats? Liberal spending? Will Trump — and the REAL Republicans — ever understand that taxes are the only income that a Democracy has?
    Just remember that every time Trump has gotten in BIG debt, he has declared bankruptcy under the protective laws of the United States. If he thinks the U.S. can declare bankruptcy, and get forgiveness and protection for America from the rest of the world, he REALLY IS living a clueless existence!

    Like

  2. Like when trump, UNINVITED, went on to the stage with DONORS, CONTRIBUTORS to a fund raiser for Boy Scouts, that his son participates in…. he PRETENDED, to be a person who GAVE A CONTRIBUTION.. Instead of the true person who just takes, SMILES AND sat there & accepted thanks, like he deserved it….WHAT KIND OF A MAN DOES THAT?….a lousy contribution, he did give, was the Years membership fees, for his son.. WTH kind of cheap ass, is this man?…. NOW that we have all committed trump- a- cide, THE TRUTH of who is & WHAT he is, will come out…..too late… this info was all out there BEFORE..,.. WE WERE WARNED….like the little girls who sang & danced at this rally… THE CHEAP SOB, refused to pay them… really?…even refused their request, to set up a table in exchange for pay… AND HE REFUSED…only his MAGA caps, were to be sold…. NICE JACK ASS, EH? SOON to be leader of the free world… GOD HELP US, IF HE AINT PISSED OFF ENOUGH, FOR WHAT his mob, has brought to the GREATEST COUNTRY IN THE WORLD… disaster…

    Liked by 1 person

    1. Judy. didn’t you make a ‘vocabulary error’ in your last sentence. Shouldn’t that have been. the “STUPIDEST COUNTRY IN THE WORLD”?

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