Who deserves credit for the booming economy? This is not a petty argument. How voters answer the question could well determine whether Democrats retake the House of Representatives come November.
Trump and Obama (and their admirers) are slugging it out, both claiming that it is their policies that have led to the ongoing economic expansion, steady job growth and higher stock prices.
Happily for President Trump, the pros agree with him. A recent survey of economists suggest it is President Trump, and not Obama, who should be taking a bow.
The Wall Street Journal asked 68 business, financial and academic economists who was responsible for the strengthening of the economy, and most “suggested Mr. Trump’s election deserves at least some credit” for the upturn.
A majority said the president had been “somewhat” or “strongly” positive for job creation, gross domestic product growth and the rising stock market.
The pros cite the White House’s push for lighter regulation and the recent tax bill as critical to a pro-growth environment; more than 90 percent of the group thought the tax bill would boost GDP expansion over the next two years.
A year ago in the same survey, economists awarded President Obama mixed grades. Most saw his policies as positive for financial stability, but neutral-to-negative for GDP growth and negative for long-term growth. By contrast, Trump was seen as neutral to positive for long-term gains.
Why would Trump rate higher than Obama with this group? Economists point to the upturn in business confidence that accompanied Trump’s election, and tie that to increasing business investment. Spending on capital goods accelerated sharply over the first three quarters of last year, growing at an annualized rate of 6.2 percent.
Such outlays will spur productivity gains and lead to wage hikes, creating a virtuous circle complete with rising consumer confidence and spending.
Unhappily Trump, voters have not yet caught up with the experts. Democrats have done an excellent job of trashing Trump’s policies, issuing hysterical alarms over the supposed dangers of deregulation (toxic water, foul air!) and vilifying the GOP tax bill.
Imagine the nation polling negative on a tax cut for an estimated 90 percent of the workers. That takes genius.
Democrats are terrified that the tax cuts will be a pleasant surprise to those who believed House Minority Leader Nancy Pelosi (D-Calif.) when she called the bill Armageddon, and when Senate Minority Leader Chuck Schumer (D-N.Y.) declared it a “kick in the gut to the middle class.”
They are even more terrified of the bonuses and raises being handed out by employers large and small, who credit the tax bill for those unexpected benefits. Democrats are trying to convince voters that those $1,000 bonuses and pay hikes are “crumbs” as multi-millionaire Nancy Pelosi recently said.
Maybe $1,000 is “pathetic” to Pelosi, but for a great many Americans, it is a big and welcome windfall.