Wednesday, August 22, 2018

Trump’s Economic Progress Exceeded Obama’s: Less Regulation and Tax Cuts Play Important Roles

By the end of July 2018, President Trump had presided over the U.S. economy for approximately 1.5 years. Compared to President Obama’s last 1.5 years, how has the Trump economy stacked up?

Overall economic growth. For the first 1.5 years of the Trump administration, the U.S. economy expanded by 4.1%, but for the last 1.5 years of the Obama Administration, the U.S. economy advanced by a much smaller 2.2%. Not only was growth significantly stronger in the Trump era, growth in the Obama Administration was trending downward in his last 1.5 years. Conversely, growth in the Trump Administration is trending upward.

Table 1 compares the Trump Administration’s first 1.5 years to the last 1.5 years of the Obama Administration’s across several critical economic performance measures.

As listed, the economic performance of the Trump Administration surpassed that of the Obama Administration across all metrics except the growth in jobs, corporate profits, and the expansion in the federal deficit.

The president’s influence on the overall economy is limited with other factors such as global growth and Federal Reserve policy playing significant roles. Nonetheless, there is evidence that Trump’s economic policies of less regulation and lower taxes are pushing most economic metrics in a more favor-able direction than experienced during the 1.5 years before Trump took office.

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