Donald Trump sat down with CNBC last week and seemed eager to boast about the strength of the economy. “We have tremendous growth,” the president said, adding, “I mean we’ve never had growth like this.”
I wish that were true. It’s not.
The U.S. economy grew at its slowest pace since 2016 last year, after posting a 2.1% advance in the fourth quarter. Gross domestic product-the value of all goods and services produced across the economy-rose at a seasonally and inflation-adjusted annual rate of 2.1% from October to December, the Commerce Department said Thursday, with full-year growth in 2019 at 2.3%.
Making matters slightly worse, the latest data points to negative growth for private-sector investment across most of 2019 — this was the one thing the Republican tax plan was supposed to address — which comes on the heels of evidence of a recession in the U.S. manufacturing sector.
It also doesn’t help that job growth in 2019 was among the worst years of the last decade.
To be sure, 2.3% GDP growth in 2019 is not awful. In fact, it’s roughly in line with the average growth we saw across Barack Obama’s second term. (Growth was higher in 2014 and 2015, but lower in 2013 and 2016.) There are, however, two political problems with the latest data for Trump and his allies.
First, the Republican seems eager, and at times even desperate, to convince the world that the U.S. economy is currently growing in ways without historical precedent. Indeed, note that he specifically told CNBC last week that “we’ve never had growth like this.”
Reality suggests otherwise. There’s nothing especially embarrassing about 2.3% annual growth, but when the president lies about it, the deception reinforces the impression that the economy isn’t quite as good as he claims.
Second, there are Trump’s promises to consider. As we’ve discussed, Candidate Trump routinely promised “4% annual economic growth” – and in some cases, he suggested his policies could push growth to as high as 6%.
Trump also ridiculed Obama for the fact that economic growth didn’t reach 3% in any year of the Democrat’s presidency.
But here we are, watching Trump stumble into a trap of his own making, overseeing economic conditions that are far short of his promises, and failing to reach 3% in any year of his own presidency.
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