Saturday, July 28, 2018

FACT CHECK: Trump Lied About His 'Economic Turnaround' And "Historic" GDP Growth All Frickin' Day!


After the quarterly gross domestic product data was released on Friday morning Donald Trump, who is in bad need of a change of subject, started braying about the U.S. economy's 4.1 percent growth in the second quarter as quickly and as often as he could.

In fact he did it all day.

While speaking from the White House, in Iowa at a manufacturing lab and in Illinois at a steel production facility Trump proceeded to drop these beauties...

"We've accomplished an economic turnaround of historic proportions,"

It was anything but.

First of all the economy Trump inherited was turned around by President Obama in 2009 after he took office during the second great depression started by George W. Bush.

With tax cuts and stimulus spending the economy slowly turned around and the took off and never stopped.

In fact the U.S. economy just entered its 10th year of growth including Obama's record breaking streak of job growth, more than two years longer than the next-longest streak.

Here is a picture of the Obama economy looked like...

Click image to enlarge

This is the truth of what Donald Trump inherited.

So unless he is talking about the Obama administration's "historic" economic turnaround he is just blowing smoke.

So there's that... But Trump was not done lying.

Trump also bragged that the the rate was "amazing" and predicted further growth...

"We're on track to hit the highest annual average growth rate in over 13 years and I will say this right now, and I'll say it strongly.

Nope.

President Obama achieved a 4.1 quarterly GDP in 2009, 2011 and twice in 2014 when the economy grew at a rate of 5.1 percent.

Annual growth has averaged just 2.2 percent since mid-2009 through the end of last year, the same as previously reported.

So there's that... But Trump was not done lying.

In the same breath Trump also claimed...

We’re having the best economy we’ve ever had in the history of our country,

The fact is that while the unemployment rate is low and growth is solid there are many measures the current economy trails other periods in U.S. history.

Average hourly pay, before adjusting for inflation, is rising at about a 2.5 percent annual rate well below the 4 percent level reached in the late 1990s under President Bill Clinton when the unemployment rate was as low as it is now.

So there's that... But Trump was not done lying.

Trump also predicted the GDP growth spurt will be sustained and even accelerate.

"These numbers are very, very sustainable. It's not a one-time shot,"

This despite the majority of economists outside those that reside in the Trump administration disagree with his bullish forecast.

the gains from rising U.S. exports in the second quarter will not be repeated plans to slap import taxes on hundreds of billions of dollars of foreign goods, which has led to retaliatory tariffs by foreign governments on U.S. goods.

So there's that... But Trump was not done lying.

Trump also touted the reports trade deficit numbers as a "win".

"One of the biggest wins in the report, and it is, indeed a big one, is that the trade deficit... very dear to my heart because we've been ripped off by the world... has dropped,"

While the lower trade deficit spurred growth in the April-June quarter the reason for it isn't necessarily positive.

Because of Trump's aforementioned plans to slap import taxes on hundreds of billions of dollars of foreign goods the threat of retaliatory tariffs by foreign governments on U.S. goods has risen.

This threat of an escalating trade war has led many foreign companies to stockpile U.S. goods before any tariffs hit. That caused a temporary boost in U.S. exports, helping to fuel economic growth.

In other words this trade deficit number is a head fake.

Hopefully the economy and job growth stays strong but if past history is any prologue we are in for stormy seas.

Remember this: Only three times in the history of this country has wealth inequality and the stock market been at their peak at the exact same time corporate tax rates were at their low...

1. Great Depression

2. Great Recession

3. And now.

And each of those times the GOP controlled all three branches of the government.

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