Trump’s Numbers on ‘Amazing’ Economy Sometimes Don’t Add Up
Posted July 27, 2018 5:29 p.m. EDT
When President Donald Trump announced Friday that the U.S. economy had grown at an annual rate of 4.1 percent in the second quarter — an achievement he called “amazing” — he included a long list of statements about how well the economy has performed on his watch.
He declared that the United States was “the economic envy of the entire world,” and indeed, the U.S. economy is in a relatively strong position: Growth is accelerating, its size and diversity make it more resilient overall, and it is less reliant than the economies of other major countries on exports, which could help it weather a trade war more easily. Growth in Japan, China and Europe has been slowing.
But several trends for which Trump took credit were underway — and in some cases more pronounced — before he took office. Other claims lacked context or foundation.
Here are some of the president’s remarks during the White House session, fact-checked:
— “We’ve accomplished an economic turnaround of historic proportions.”
This requires context.
It does look as if the growth rate has picked up meaningfully this year and may be on track for the best year of the decadelong recovery. But the economy is continuing the essentially upward trajectory established before Trump took office, with some quarters growing a little faster and some more slowly. In a given quarter, the economy exceeded 4 percent annual growth four times during the Obama administration, with the highest level — 5.3 percent — occurring in the third quarter of 2014. The jobless rate was 7.8 percent when President Barack Obama took office in January 2009, and was 4.8 percent when he turned over the reins to Trump. In Trump’s 18 months in office, the jobless rate has fallen further, and was 4 percent last month. Gross domestic product has risen every year for the past nine years.
— “We have added 3.7 million new jobs since the election, a number that is unthinkable if you go back to the campaign. Nobody would have said it.”
This is misleading.
While Trump’s figure is accurate, his suggestion that the number would have been “unthinkable” is not. In fact, the economy added more jobs in a comparable period before his election.
In the 19 months from December 2016 to June 2018, the economy added just under 3.7 million jobs. In the 19 months before Trump’s election, the economy added 4.3 million jobs.
— “We are now on track to hit an average GDP annual growth of over 3 percent, and it could be substantially over 3 percent. Each point, by the way, means approximately $3 trillion and 10 million jobs.”
This is unclear.
Given that the nation’s GDP is just under $20 trillion a year, and that about 160 million people are in the labor force, those increases would require several years of economic growth to achieve. Trump did not give more specifics.
— “Ninety-five percent of American manufacturers are optimistic about their company’s outlook. And that’s the highest level, also, in history.”
The National Association of Manufacturers released the results of its quarterly survey of manufacturers last month. Among the 568 respondents, 95 percent registered a positive outlook for their own company, the highest level recorded in the survey’s 20-year history.
— “More than 10 million additional Americans had been added to food stamps, past years. But we’ve turned it all around.”
This is exaggerated.
The number of Americans in the Supplemental Nutrition Assistance Program increased by more than 10 million during the recession. But enrollment has declined every year since a peak of 47.6 million in 2013. And the latest available data does not show a steeper decline under Trump.
From February 2017, Trump’s first full month in office, to this April, SNAP participation decreased by about 2.5 million people. In the 14 months before that period, participation declined by 2.8 million.
— “In the first three months after tax cuts, over $300 billion poured back into the United States from overseas. We think it’s going to be, in the end, when completed, over $4 trillion will be back into our country.”
This requires context.
The Bureau of Economic Analysis estimated that $306 billion was repatriated into the United States in the first quarter of this year.
But estimates for the total amount of untaxed corporate earnings held offshore range from $2.3 trillion to $2.8 trillion — much less than Trump’s $4 trillion figure.