Thursday, June 07, 2018

Lie Of The Day (June 5, 2018)

It's the GOP fallback position, and very, very important.

Chris Cuomo interviewed an uncomfortably smiling Sarah Huckabee Sanders on "Cuomo Prime Time" Wednesday night about a variety of topics.  They included the credibility of the Presidential Press Secretary compared to that of the press, the 2016 Trump Tower meeting, the allegation of an FBI "spy" inside the White House, veterans, tariffs, the budget deficit, and immigration.

But what Sanders really wanted to talk about was the economy.  She realizes, after all, that it is the issue on which the Administration is least likely to get challenged- by Cuomo, other journalists, even Democrats. She even stated "I wish we spent a lot more time talking about the economy," she said at one point.

And she said "Multiple people have said that we have the strongest economy that we've had since World War II."

That may well be true. She may have gone home one night and said to her husband and two children "repeat after me: 'we have the strongest economy that we've had since World War II.'" They may have complied. Multiple people.

Better, we have Donald Trump on Tuesday:

It would be "nice," even "cool" or "awesome"- were it true.

Unfortunately it's not, and fortunately we have Jeanna Smialek to explain

Judging solely by gross domestic product, perhaps the simplest way to gauge a nation’s progress, the decades that followed World War II were the hottest in American history. Pent-up consumer demand, a housing boom and a vibrant manufacturing sector all melded into the economy’s Golden Age. By the GDP yardstick, the current pace of the expansion pales in comparison…

Still, the overall jobless rate -- 3.8 percent in May -- has been lower in the past, dipping below 3 percent during the 1950s. The time it takes unemployed people to find work also remains elevated. And while wage growth has slowly picked up, past expansions have seen much bigger gains. That’s true even after accounting for today’s modest inflation.

“If you’re a new data scientist, or Ph.D. economist, yeah, it’s a great time to look for a job,” Lawrence Katz, a Harvard University economics professor who served as the Labor Department chief economist during the Clinton administration, said when asked if this is the best time to look for work. “If you’re a janitor, a construction worker in some places -- No.”

Katz noted that in the late 1960s and late 1990s, wage growth was booming for such everyday employees. And in the 1960s, jobs put workers on a path toward benefits and economic security in the longer run -- more of a rarity today, in a world where unions and pension plans are few and far between.

Michael Bordo, an economics professor at Rutgers University and an authority on monetary history, agrees with Katz on that timing. The best economic period judging by unemployment was the 1960s, he said. In terms of economic growth, it was the 1960s and the 1990s.

Bloomberg's Timothy L.O'Brien notes

As you might have guessed just from reading this, "increased economic value" in this context is a bogus metric, one Trump has ginned up to describe something that isn't actually happening.
Trump's $7 trillion figure refers to how much the overall value of the U.S. stock market has risen since he was inaugurated as president last year. It has nothing to do with the growth in the value of goods and services — which is known as "gross domestic product," not "increased economic value."

More important, Trump isn't presiding over "the best economy in the history of our country." 

Unemployment is at an 18-year low, 3.8 percent, but the unemployment rate was lower in the years right after World War II (it was 2.5 percent in 1953, for example). GDP growth is ticking along at about 2 percent to 3 percent annually, but in the 1960s it was about 5 percent annually. Wage growth is slower today than in the past and the labor force participation rate also lags.

That's not to say that things aren't good right now in many ways. They are. They're just not as good as Trump is saying.

In the interests of full disclosure: O'Brien added "I suspect that Trump isn't riffing on "increased economic value" simply out of ignorance. By tying an economic assessment to the stock market's ascent, Trump can clearly distinguish himself from his predecessor, Barack Obama."

But that is why he is not simply ignorant.  The Chaos President does virtually everything- the pardons, the Iran nuclear deal, health care, taxes, trade- in a manner meant to distinguish himself from No Drama Obama. And it is hard to believe the 71-year-old Trump, proud graduate of the esteemed Wharton School of Finance and Commerce, is unaware of the booming economy enjoyed by his country (in this case, the USA, not Russia) in the years immediately following World War II.
Best economy since WWII? Increased economic activity by $7 trillion dollars.

Democrats have been ceding ground to President Trump on "the economy." They should not. 

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