This is an example of what @Pappadave complained about to me when I cite statistics. The Examiner points out:
4.2 percent [nominal] growth in the second quarter of 2018.
Which is 100% true. But it lacks some crucial context that makes the information more useful and puts the information in a proper context. The Examiner is being intentionally misleading or they aren’t knowledgeable enough to understand the data they are reporting.
So what is it that makes this reporting misleading??
Real growth for that quarter was 3.2% Real growth is how we measure growth in any meaningful way. 4.2% looks great, but when put in context (real vs nominal), the highest rate of growth was right before Trump took office (Q1 2015 - 3.9% - real growth) and prior to that it was in 2010 (3.1% Q3 real growth)
Using nominal statistics is like citing the population by only measuring births and ignoring deaths and immigration/ emigration. The gross increase in population would be measured in births, the net would be births immigration minus anything that causes the population to decrease which would give you a much closer actual number.
For the first time in more than a decade, growth is projected to exceed 3 percent over the calendar year.
Real growth is what matters and how best to make comparisons. Real growth has been declining for almost a year.
Here are the jobs number sliced and diced every possible way you can think, most if not all significant statistics are trending downward.
Now in fairness to Trump, there are a few things happening, unemployment is falling and labor slack is being reduced. What we need now is not just jobs but better jobs. Automation will be key in freeing people from the lowest paying lowest skilled jobs, jobs that can easily be automated (cashier at McDonald’s). Of course, in order to get people out of low skilled work, we’ll need higher levels of education and opportunity.
That said, pointing the finger at Trump I’d point out that, undoubtedly, the trade war, which coincides perfectly with the most recent down turn (Q2 2018), correlates perfectly, has contributed to the real slowdown and is part of the self-inflicted issue Trump faces.
Do you know of any specific initiatives Trump or his administration have supported or enacted to get lower wage, lower-income people greater opportunity for education, be it college or any sort of training in trades or vocational skills?
As far as the stats, I know that media in general, not just the right-leaning media uses statistics the way that the Examiner has done in the example I gave.
Most people don’t know what the terms “real” and “nominal” mean in an economic context (one reason a good education is so important and why economics should be taught as a class just like math and English).
That said, not everything Trump has done has been bad. He lowered taxes and increased spending. This nets more money into the private sector and in my opinion is the single biggest factor in the growth we’ve seen.
That said, most of the benefits have gone to people that do very little in terms of driving demand. Much of it has been captured by the investor class and corporations that are sitting on trillions of dollars because the economy lacks the requisite demand to drive greater levels of investment.
This is what some might call the failure of supply-side econ. The idea that if you give the investor class more money that money will work it’s way down into the broader economy. Insted what we’re seeing is the wealthy are using money to capture more money.
See, Capitalism was a story about creating a product, selling it and using that money to buy other things that people needed/ wanted…
In the financial economy that’s grown over the last 30 years what we’re seeing today is capital used to create a product to capture even more capital.
This isn’t an optimal way for Capitalism to work. Adam Smith and Marx both understood this, it’s amazing to me that so few people understand it today.
Efficient capitalism, a system that operates entirely in the best interest of individuals, will fail to see that individuals that adhere to a Randian Esque variety of capitalism will end up destroying the very markets they need for their own survival.