Thread by @Noahpinion

1/In today's @bopinion post, I explain why Trump doesn't deserve credit for the good economy of 2017-19.

bloomberg.com/opinion/articl…

2/Polls consistently show that the economy is Trump's strongest issue.

Which is a little weird, given that unemployment is sky-high thanks in part to Trump's disastrous pandemic response.

But perhaps people are giving Trump credit for the pre-COVID economy.

3/Before COVID, wages were increasing for the typical American. And unemployment fell to low levels.

These were trends that Trump inherited from Obama's 2nd term.

But at least the trend didn't reverse under Trump. So does he get credit?

4/Trump basically did two economic policies before COVID came along:

1. The Tax Cut

2. The Trade War

5/The tax cut's long-term impact will probably never be known, thanks to other stuff that happened in the meantime.

But in the short-term, an analysis by the IMF found that the tax cut didn't boost business investment much if at all.

imf.org/en/Publication…

6/Corporate tax cuts are supposed to work by boosting business investment! If they don't do that, they're not having the intended effect.

Another 2019 study, this one by the Congressional Research Service, also found little or no effect.

everycrsreport.com/files/20190522…

7/This is not to say that Trump's tax cuts were economically ineffectual.

Maybe they'll have a long-term effect! Who knows!

But it appears they weren't responsible for sustaining the expansion of 2018-19.

8/Now on to the Trade War.

Trump's tariffs were touted as a way to bring manufacturing back from overseas.

By this standard, they clearly failed.

9/Trump's tariffs almost certainly HURT U.S. manufacturing by making imported components and materials more expensive for U.S. manufacturers.

bloomberg.com/opinion/articl…

10/What's more, U.S. consumers ended up paying most or all of the cost of the import taxes.

econ.ucla.edu/pfajgelbaum/RT…

princeton.edu/~reddings/pape…

So economically, the Trade War was a complete failure.

11/Businesses knew it, too. An initial burst of economic optimism on business surveys in 2017 and early 2018 started trending down once Trump started the Trade War.

12/So Trump should get no credit for the continuation of the economic expansion that he inherited from Barack Obama. His tax cuts were ineffective in the short term, and he tried his best to mess things up with a boneheaded Trade War. And then came COVID.

13/And of course, Trump's disastrous pandemic response is now resulting in the economy continuing to be crushed! So Trump has really been a terrible steward of the economy.

(end)

bloomberg.com/opinion/articl…