Economic growth is a constant talking point for politicians in the United States. A politician’s popularity or reputation, in particular, often thrives or suffers based on the state of the economy. Presidents are no different. Hertie MIA candidate Madison Wilson touches on the polarization of these arguments and whether a President can ever truly receive credit for their policies.
During both of his terms, President Obama was dogged by Republican counterparts concerning the economy. In fact, at the start of his first term, he faced the worst financial crisis the United States had seen since the Great Depression. Despite this, when the Labor Department released its last job report in December 2016 for the administration, it seemed as if Obama had done it; he had managed to revitalize the economy. Over 11 million jobs (nearly five times as many under former President Bush) had been created, annual wages had not only increased, but had stayed above the level for inflation, and “real” household income had grown by 5.2 percent, or $2800. The next President would begin his tenure with a healthy outlook for an expanding economy.
Throughout 2015 and 2016, using Twitter as his medium, Donald Trump repeatedly criticized the way Obama handled the economy. Since entering office on January 20th 2017, Trump has been quick to steal the limelight and take credit for this ever bolstering economy. On June 11th of this year, he tweeted out:
“Great numbers on the economy. All of our work, including the passage of many bills & regulations killing Executive Orders, now kicking in!”
Commonly lashing out at large media corporations and calling them “fake news,” he has repeatedly credited himself with the economic growth seen since he took office, often lamenting over the fact that credit is not being given where “credit is due.” For example, his tweet on July 3rd directly addressed this;
“At some point the Fake News will be forced to discuss our great job numbers, strong economy, success with ISIS, the border & so much else!”
The counter to Trump’s claims have been that this economic growth is not a result of President Trump’s administration – his policies have not had time to make any significant changes on the US economy. The current economic state is instead a result of the decisions made by President Obama and his Congress. In order to find a find middle ground between these sentiments, the question needs to be asked: Who is responsible for the continued economic growth? Can the strong partisan divide,ten months into Trump’s presidency, still enable the Democrats to claim that the present fiscal position is only possible because of President Obama’s decisions, while Republicans fire back and retort that it has only continued because of Trump’s choices? When is it time to set aside differing opinions towards the current president and concede that he may be enacting policies that do indeed help the economy; or, has this not yet come to pass?
As mentioned, President Trump has had no trouble taking the credit for the positive economic conditions, the decrease in unemployment, and the gains made in the stock market. The Dow Jones industrial average, for the first time in history, has gone above 22000 points. Since Election Day, stocks have been slowly rising, only seeming to balk with Congress’ inability to pass some sort of health care reform – a confident Congress enacting fiscal policy places confidence in the market. While this is good news for Trump, (and no doubt the economy as a whole) it is worth mentioning that the stock market has been making gains since its lowest point in 2009 and the financial crisis, and so the trends in the last year can be seen as a continuation of the overall trend.
Polls which rank how confident consumers feel spiked after the election and attributed it to the Republicans’ optimism about the economy. This increase in confidence has leveled out since then, but it is still higher than what it was at the end of Obama’s term, according to numerous surveys. Unemployment hit a low of 4.3 percent, falling well within the “healthy” unemployment range. After a peak unemployment of 10 percent in October of 2009, however, unemployment has been steadily falling to safer levels. There has also been little evidence, despite Trump’s tweets that say otherwise, of a significant jump in the number of job creations, with a smaller monthly average seen so far in 2017.
It seems that so far in Trump’s presidency there has been a continuation in the economic growth spurred under President Obama. At the same time, some of his policies seem yet to make an impact (or may ultimately not have the desired effects). Coal country USA, where Trump drew a great amount of support from during his campaign, has only added (as of July 2017) a net 600 jobs since the beginning of his term. Citizens in this job sector proved crucial on the campaign trail, and the promise to rely on coal and create jobs in the sector were often part of Trump’s rhetoric. Additionally, the US dollar has fallen significantly in value since January. When asked about decline in the dollar’s strength, Trump told the Wall Street Journal “I think our dollar is getting too strong, and partially that’s my fault because people have confidence in me.” At the end of August, Trump boasted that GDP had reached a growth rate of 3 percent, but neglected to remark that this was only a quarterly rate, with the second quarter expected to only be at 2.3 percent.
Whether deserving or not, approval of the president is largely based on how well the economy is doing. While it seems that the trends started under President Obama have been continued by President Trump, it has almost been a year under Trump’s leadership and the economy is not falling into disarray. There is no way to tell how the economy of the United States would be doing without the policies of Barack Obama, but the evidence presented demonstrates that President Trump has not taken action which has harmed the United States or its workforce. Going on one year since Trump’s election, it is time to no longer say “Thanks Obama,” but it is still not possible to determine whether or not the public can say “Thanks Trump.”
Madison Wilson is a class on 2019 Master of International Affairs candidate at the Hertie School of Governance. She graduated from Augustana University in Sioux Falls, South Dakota (USA) with a BA in Government and International Affairs, International Studies, and German. She’s passionate in the study of international law and social change. When not studying, she likes to curl up with a good book and a cup of Earl Grey.