Trump Is Now A Recession President
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Donald Trump is all about appearances. At every chance he gets, from polling to jobs reports, he somehow finds a way to take the figures, regardless of how bad they are, and spin them in a way that portrays him in a positive light. The recent jobs report is no exception. But this time the smokescreen that Trump is trying to throw up won’t work. Whilst we’re all now used to Trump’s habit of exaggeration, his claims that the “economy is in the early stages of coming back” and that he has built “the greatest economy in the world” because there’s been a small dip in the unemployment rate, is a remarkable stretch even for him.
The Labor Department’s report showing that 2.5 million Americans were added to payrolls in May is good news, given economists predicted there would be a loss of over 8 million jobs due to the ongoing impact of the coronavirus outbreak. But it is unclear how much of those jobs were due to gains from the Paycheck Protection Program. Also, it is beyond naïve to pretend the US economy is on the road to recovery. In fact, the reality is the complete opposite.
The US unemployment rate is still at its lowest since 1940 and while white unemployment declined from 14.2% to 12.4% in May, black unemployment increased from 16.7% to 16.8%. It is now official: The United States has entered its first recession since 2009, according to the National Bureau of Economic Research. This ends the record-setting period of 128 months of consecutive economic growth that came to an end in February before the coronavirus pandemic hit the United States.
The Trump/Pence administration inherited the longest economic expansion in US history from the Obama/Biden administration but, instead of nurturing it and creating a plan to ensure the continued growth of the economy, they squandered it by using their position to cut taxes for corporations and wealthy individuals while failing to prioritize the needs of ordinary citizens. This left Americans without a suitable safety net of cash when Trump’s failed response to coronavirus triggered this recession.
Donald Trump’s economic plan, or lack thereof, failed to lead to economic growth suitable to offset the deficit it caused, or to make the US more competitive globally, or to produce the increase in investment that he claimed would occur. Instead, it has left the US government with an estimated $1 trillion in lost revenue over 10 years, resulting in a huge gap in the budget, a situation that has worsened even further due to the continued damage from the coronavirus outbreak. Now, instead of being remembered as a president who knows the art of the deal, Donald Trump’s lasting economic legacy will be a higher deficit and a bigger national debt.Looking to make a difference? Consider signing one of these sponsored petitions:
This situation has been paired with Donald Trump’s trade policies that have eroded America’s standing on the world stage and undermined foreign relations. By launching into the still ongoing trade war with China, Trump prevented the gains in business investment that the tax cuts were designed to provide, whilst also creating ill will that scared off other countries or, at least, made them less likely to align themselves closely with the current occupant of the White House. Now that the coronavirus outbreak has had a damaging impact on global trade, this difficulty is only going to be further amplified.
Pushing an ‘America First’ strategy might be popular with some USA citizens but, in the long run, it is not a winning approach to international diplomacy when, in an ever-intertwined world, you need to have strong relations with allies and adversaries alike. Donald Trump might have won the 2016 presidential election with his ‘Make America Great Again’/’America First’ declarations, appealing to Americans in areas of the country that have been hit hard by economic difficulties, but, now he’s pushed the US into a recession, those same voters are going to be looking at his presidency as having only made their situation even worse.
Looking at historical trends, Donald Trump should be deeply concerned by what is currently happening in America. Running for re-election during a recession is, at best, an uphill battle and, at worst, a fool’s errand. Out of the five US presidents who’ve experienced a recession during the last two years of their first term only one was re-elected: William McKinley. The other four (William Taft, Herbert Hoover, Jimmy Carter, and George H.W. Bush) had to face the embarrassment of becoming one-term presidents.
To make things harder for Trump, his opponent, Joe Biden, is widely credited with leading the recovery efforts that led to the aforementioned record economic expansion, with many in America believing that he could do it again if elected president. When members of the American electorate are poised to cast their vote in November and they are looking at the two options in front of them, a recession president or a former vice president who is credited with rescuing the US economy, who are they going to pick? The answer is obvious.
James Carville had it right in the 1992 presidential election when he coined the phrase: “The economy, stupid”. Voters are interested in where politicians stand on everything from healthcare to climate change to foreign policy to the justice system but, at the end of the day, it all comes back to the economy and their plan to ensure that the ‘American Dream’ is still alive and well. Donald Trump hasn’t done that. In fact, he’s made that dream less and less achievable.
During the global pandemic, US states shut down and people couldn’t work, resulting in 40 million Americans losing their jobs. How did Donald Trump respond? He gave Americans a one-time $1,200 payment that barely covered their bills for one month, let alone the rest of the time they’ve been forced to stay at home or found themselves unemployed. Trump and the GOP have so far blocked any additional stimulus that Democrats have tried to legislate directly into Americans’ wallets. This debate is growing in importance as enhanced unemployment insurance benefits are set to expire in July.
Under the trade war with China, tariffs on farmers increased from 8% to 38%, punishing Americans who rely on Chinese consumers to keep them afloat. How did Donald Trump respond? He claimed he’d secured a new US-China trade deal that would help put money back in farmers’ pockets when, in reality, the deal eventually fell apart and it all became nothing more than hot air.
Donald Trump can go on Twitter and constantly make all-caps posts stating “MAKE AMERICA GREAT AGAIN” or “TRANSITION TO GREATNESS”. He can even hold a press conference to brag about the US regaining 2.5 million of the over 40 million lost jobs, even though it’s difficult to see how the actions of the Trump administration helped to reverse the job losses. The reality is that, just as he bankrupted his own businesses numerous times through economic mismanagement, Donald Trump has plunged the US into an unnecessary recession, with no plan to rescue the US economy.
If that’s where the US is after less than 4 years of a Trump presidency, imagine where the US will find itself if he gets another 4 years in office. Donald Trump was very willing to take credit for the economy when it was booming as a result of actions taken during the Obama era. Now the responsibility for America’s economic difficulties rests entirely with him. None of the tweets, speeches, or press conferences will change the fact that Donald Trump is now a recession president.