THE ECONOMY OF AMERICA
President Donald Trump inherited a strong economy and continued to grow at a healthy pace during his first three years in office. Then the Covid-19 pandemic changed everything.
At the beginning of Donald Trump’s presidency in January 2017, the economy was healthy.
Employers had added jobs for 76 straight months – the highest recruitment record at the time – and unemployment was just 4.7%, a 10-year low. Corporate profits were close to all-time highs, and so were stocks. Overall, gross domestic product was growing at about 2.5% per year – a moderate percentage for the world’s largest economy. Not everything was rosy: federal debt was at its highest level since the 1950s. But by most measurements, it was hard to deny: the economy was on a solid footing. And fortunately for Trump, growth has continued from there.
Below, we looked at 10 indicators to show how the economy has evolved under each president from Ronald Reagan to Trump. Keep in mind that each presidency started under different circumstances. George W. Bush’s first year in office was plagued by dot-com failure and 9/11 attacks. Barack Obama began the Great Recession after a catastrophic housing collapse and a global financial crisis. Despite these crises, however, most recent presidents preside over a growing economy during their tenure. Trump’s presidency will be marked by the country’s response to the Covid-19 pandemic, which continues to play both a health crisis and one economical.
Place the mouse pointer on the charts to see how the economy under Trump compares to how it evolved under his predecessors.
Until 2020, President Trump’s first term was marked by steady job growth, but then the pandemic disappeared 15% of US jobs in just two months. Since May, the economy has recovered only half of those jobs, and Trump is running in the election with worst job losses under any chairman.
By contrast, at this point in the Obama presidency, the labor market grew by 0.4%. He took office at a time when employers were cutting hundreds of thousands of jobs a month. Recruitment moved at a higher speed later in his presidency.
By the time Trump took office, he had inherited one of the strongest labor markets in American history from Obama. But Covid-19 quickly put an end to this. The unemployment rate was shot at 14.7%, by 10 percentage points since Trump took office. Although it has improved slightly since then, unemployment remained high in September. No other president has faced such a sudden rise in unemployment.
Trump loves to talk about how middle-class incomes have risen during his presidency – and this is true in his first three years. In September, the The Census Bureau published data showing that the average American household won $ 68,703 in 2019 – $ 5,800 or 9% increase from 2016, after adjusting for inflation. A strong labor market helped increase revenue, as more people worked full time, all year round. And more than 20 states also set their own minimum wage, increasing the profits of low-income workers.
We do not yet have data for 2020, but the pandemic will definitely affect these numbers greatly. For some families, $ 1,200 stimulus checks and a temporary $ 600 increase in weekly unemployment benefits actually boosted incomes during the pandemic. However, many others, especially those who have lost their businesses or are facing long-term unemployment, are struggling to meet their needs.
The biggest bull market in history began shortly after Obama took office and continued well under Trump. Investors hailed Trump’s corporate tax cuts in 2017, and although the trade war with China put them aside, stocks enjoyed a record until 2020. At the start of the 2020 pandemic, S&P 500 fell 34% in about a month, before recovering later in the summer. As of October 27, the index has risen a total of 49% under Trump’s presidency. While this rapid recovery is a bright spot for him, it also contrasts with the 76% gains from Obama and 64% with Clinton at the same point in their presidencies.
The housing market is one of the few parts of the economy that has not shrunk dramatically during the pandemic. This is partly why low interest rates and the trend of working from home led the residents of the city to buy houses in suburban and rural areas, strengthening housing prices in many areas. It is also because of extensive measures, including one moratorium on evictions and mortgage tolerance programs, have helped struggling families cope with the crisis so far. These unpaid bills could eventually cover millions of families, causing inconvenience in the housing market. But so far, housing prices have risen 21% since Trump inaugurated.
Food pricesSmall increases
If you feel that your grocery account is out of date, this is because food prices He made comber suddenly during the pandemic. However, over long distances, they were relatively stable. At the same point in the presidencies of Reagan, George HW Bush, Clinton and George W. Bush, food prices had already risen by 9% or more. They are just 6.1% below Trump and were 5.9% below Obama a time of low inflation.
Consumer expensesUp, but low performance
American consumers are the backbone of the American economy and they are not easy to get along with. Although consumers abruptly spending cuts At the start of the pandemic, they quickly opened their wallets in May and June, when stimulus checks and unemployment benefits helped. Retail spending on goods, in particular through online retailers, recovered quickly. (Meanwhile, costs for services such as cuts, journey and to dine in restaurants remains well below the pre-Covid-19 rules.) Even with a rapid recovery, however, consumer spending has risen less under Trump than in any of the previous five presidents.
Construction workIt just changed
American constructions peaked in 1979, and no president other than Clinton has presided over factory profits since. So when Trump promised to resume factory work, it was a high class. In the first three years of Trump, the manufacturing sector added a few jobs, but in 2020, the pandemic destroyed the minimal progress made by workers. Since September, the sector has shrunk by 164,000 jobs, or 1.3% since Trump took office. That said, factory layoffs were even sharper under Presidents Reagan, Obama and Bush, as globalization and technological advances reduced America’s workforce.
The burden on the federal government has not been so high in relation to the size of the economy since then World War II, but did not get there only during Trump’s presidency. Debt rose under Reagan, who introduced massive tax cuts, and rose under Obama, who used federal stimulus funds to help the economy during the Great Recession.
When Trump took office, the debt was about 76% of GDP. But by mid-2020, was 105% – an increase of 29 percentage points during his presidency. Economists often argue that they repay debt when the economy is strong and spend more when the economy is weak. But despite his promises to “get rid” of debt, Trump has raised it to both good and bad. While much of this increase came from Korana aid funds, past policies such as corporate tax cuts and rising defense spending have also fueled the rise.
Gross domestic ProductA deep recession
The broader measure of economic activity – Gross domestic Product – measures the value of goods and services produced in the country. It usually increases between 2% and 3% per year after adjusting for inflation. The first three years of Trump it was all within that range, but in 2020 there was a deep decline. We do not have a whole year of data yet, but the the second quarter was the worst in records since 1947. The data of the third quarter is expected on Thursday, and is expected to show some improvement – but not a full recovery.
Additional development by Byron Manley
Gross domestic product lines are calculated as a percentage change from the fourth quarter before the inauguration of each president, which is the most recent figure before taking office. The lines for the average income are calculated as a percentage change from the last calendar year preceding the inauguration of each president. Lines showing unemployment and federal debt are calculated as a percentage change, as these two measurements started as indicators. All other lines are calculated as a percentage change from January when each president was inaugurated. President Reagan does not appear in the house price data because the data is only available in 1987 and does not include his entire presidency.