Regular readers know that I give Trump mixed grades on economic policy.
He gets good marks on issues such as taxes and regulation, but bad marks in other areas, most notably spending and trade.
Which is why I’ve sometimes asserted that there has been only a small improvement in the economy’s performance under Trump compared to Obama.
But I may have to revisit that viewpoint. The Census Bureau released its annual report yesterday on Income and Poverty in the United States. The numbers for 2019 were spectacularly good, with the White House taking a big victory lap.
Here are the three charts that merit special attention.
First, we have the numbers on inflation-adjusted median household income. You can see big jumps for all demographic groups.
Next, here’s a look at whether Americans are getting richer or poorer over time.
As you can from this chart, an ever-larger share are earning high incomes (a point I made last month, but this new data is even better).
Last but not least, here’s the data on the poverty rate.
Once again, remarkably good numbers, with all demographic groups enjoying big improvements.
We’ll see some bad news, of course, when the 2020 data is released at this point next year. But that’s the result of coronavirus.
So let’s focus on whether Trump deserves credit for 2019, especially since I got several emails yesterday from Trump supporters asking whether I’m willing to reassess my views on his policies.
At the risk of sounding petulant, my answer is no. I don’t care how good the data looks in any particular year. Excessive government spending is never a good idea, and it’s also never a good idea to throw sand in the gears of global trade.
But perhaps we should rethink whether the positive effects of some policies are stronger and more immediate while the negative effects of other policies are weaker and more gradual.
I’ll close with two cautionary notes about “sugar high” economics.
- First, Trump’s fiscal policy of tax cuts and more spending could be viewed as textbook Keynesianism. I definitely don’t think that approach creates more long-run growth, but it can lead to some illusory short-term prosperity as an economy consumes more than it produces.
- Second, I worry that some of last year’s good economic data may have been the result of the Federal Reserve’s easy-money policies. As I’ve previously noted, bubbles always feel good when they’re expanding. They don’t feel so good when they pop.
For what it’s worth, we’re not going to resolve this debate because coronavirus has been a huge, exogenous economic shock.
Though if (or when) the United States ever gets to a tipping point of too much debt, there may be some retroactive regret that Trump (along with Obama and Bush) viewed the federal budget as a party fund.
Figure 1 and Figure 2 are beautiful charts. How can I go to the Census Bureau and find the data to share with a nonbeliever who won’t believe Mr. Mitchell.
[…] was in 2019,” under the Trump administration. Mitchell, who has been a Trump critic, pointed to a blog he wrote where he acknowledged that the Census Bureau’s 2019 report on U.S. income and poverty […]
[…] Heck, that’s what I did. […]
[…] was in 2019,” under the Trump administration. Mitchell, who has been a Trump critic, pointed to a blog he wrote where he acknowledged that the Census Bureau’s 2019 report on U.S. income and poverty […]
[…] was in 2019,” under the Trump administration. Mitchell, who has been a Trump critic, pointed to a blog he wrote where he acknowledged that the Census Bureau’s 2019 report on U.S. income and poverty […]
[…] was in 2019,” under the Trump administration. Mitchell, who has been a Trump critic, pointed to a blog he wrote where he acknowledged that the Census Bureau’s 2019 report on U.S. income and poverty […]
[…] was in 2019,” under the Trump administration. Mitchell, who has been a Trump critic, pointed to a blog he wrote where he acknowledged that the Census Bureau’s 2019 report on U.S. income and poverty […]
[…] Heck, that’s what I did. […]
[…] are included, but I won’t blame Trump for coronavirus-caused economic havoc (though I also don’t give him full credit for the good data in […]
[…] are included, but I won’t blame Trump for coronavirus-caused economic havoc (though I also don’t give him full credit for the good data in […]
LeBron James is the Lil B of basketball… Sucks at what he attemps to do for a living.|PrinceDSwagg|
[…] I also think it’s strange that Koll compares the last eight years, which mixes the stagnation of the Obama years with the somewhat better performance of the Trump years. […]
[…] in mind that this poll took place last year, when the economy was booming and voters presumably had a more positive view of President Trump. I suspect the Trump children […]
[…] that’s still a nice chunk of change – about four times as much as the average household earned that […]
[…] that’s still a nice chunk of change – about four times as much as the average household earned that […]
Dan, yes you are being “petulant.” I totally agree with the comment of sdu754 above.
You’re discounting the enormous benefit of President Trump’s significant decrease in regulation and tax cuts.
Do you really think that if Obama’s policies had continued, then America would have had the same excellent results that President Trump’s policies gave? No. I didn’t think so.
Re: “We’ll see some bad news, of course, when the 2020 data is released at this point next year. But that’s the result of coronavirus.”
Wrong! It’s primarily the result of bad government policies in response to the pandemic.
Re: “For what it’s worth, we’re not going to resolve this debate because coronavirus has been a huge, exogenous economic shock.”
Wrong again! It’s mostly bad policy in response to the virus that has been a huge exogenous economic shock.
Reblogged this on Boudica BPI Weblog.
It’s very obvious that you simply just don’t like Trump so you are unwilling to give him any credit what so ever.
All you free trade zealots forget several things:
1) Keeping terrible trade deals where American goods are slapped with far higher tariffs than what we charge the offending countries is bad for the American people.
2) Trump’s tariffs are temporary measures to force other countries to give American products a fair shake.
3) It’s not the 1920s anymore. The United States doesn’t have a trade surplus. Other countries need us far more than we need them
4) Tariffs protect American jobs. Paying a few pennies less doesn’t really help much when you lost your good paying job and can’t afford to buy what you would be paying more for under a tariff in the first place.
5) Tariffs as a form of taxation is far more preferable to income, estate, gift and property taxes.
As far as spending goes, Trump has tried to cut spending. The last time spending was actually cut was after the Korean War under Eisenhower. I’m talking total spending not compartmental spending where someone can pick and choose which spending that they want to count. Why no spending cuts since the 1950s? Because the special interests groups that receive the money will fight tooth and nail to maintain their programs convincing people that the spending is “essential”. Trump can’t be blamed for a trend that was happening for sixty years before he became president.
The inflation rate has been around 2% since Trump took office, so there is no proof that the Fed is pumping up the economy with inflationary expansion of the money supply.
Nobody does. Democrat Congressional members, governors and local officials deserve the blame for it not being better. Toss in the CDC, NIH and Chinese for a share of that too.