One of the major problems confronting the Democrats in 2020 is the state of the economy. Barring some deus ex machina, President Trump is going to campaign for reelection within the context of a significant economic boom. The stock market is booming. Inflation remains low. Real wages are up. Labor force participation is up. Unemployment is at near historic lows. Ordinarily, people would be happy for a great economy, but, with the Democrats, good news for America is bad news for their party.
Their most immediate problem is how to rationalize the economy under Trump to the economy overseen by Obama. At that point, the conventional wisdom among Democrats and professional economists was that high unemployment, low labor force participation, and stagnant wages were the new normal.
Now MSNBC “personality” Chris Hayes has his own theory to explain the difference:
Everyone who called for austerity got it wrong and caused harm
Everyone who scaremongered about the deficit got it wrong and caused harm
Everyone who wrote about the “skills gap” got it wrong and caused harm
Everyone who kept warning about inflation got it wrong and caused harm
Lots of regular people – critics, bloggers, gadflies, etc were able to see this but the commanding heights of the econ/policy/political worlds either could not or would not.
Or, an even less charitable interpretation: they didn’t get it wrong at all. They didn’t want full employment, they didn’t want wage growth and empowered workers and they certainly didn’t want that happening under a Democratic president.
I mean, years of the titans of industry whining about the skills mismatch, how they can’t find good workers, and chin-stroking conferences about labor force participation, and columns about how it was workers’ own fault, on and on and on, all just garbage.
Yep. That’s exactly what happened. Tens of thousands of American businesses decided they’d go out of business rather than let Obama’s economic plan be a success. Millions of Americans decided they’d just sit at home and not work to screw the black guy.
This is ridiculous.
Not to say that Obama didn’t inherit an economic mess, he did. But, like FDR’s New Deal, Obama tried to use a financial crisis to fundamentally change the US economy and to increase government influence. He reduced the workforce by nearly 9 million by liberalizing rules for disability insurance and did this as much to try to create a new class of benefit recipients who would reliably vote Democrat as for any other reason. But the reason that the economy has taken off under Trump is because both consumers and employers feel more secure in their finances and have more confidence to make major investments and purchases. Putting the brakes on federal rule-making and rolling back rules that inhibit growth have also been a factor. Getting out of the way as oil/gas exploration and extraction has boomed has been a major stimulus to the national economy.
More to the detail of Hayes nonsense. Obama was not burdened with any “austerity” measures
Neither has Trump benefited from an increase in inflation:
A lot of the “skills gap” was utter bullsh** pushed by the Chamber of Commerce in its eagerness to bring in more cheap H1B visa recipients to replace American workers. Under Obama, most American STEM graduates didn’t work in that field but no one in the White House ever challenged the narrative because Obama, too, wanted cheap foreign workers and Americans on the dole.
I have no doubt that this will become a full-fledged scandal, probably rating its own special counsel, by the time the election season is in full swing. There is probably a Michael Moore movie in the making about this conspiracy. But most people are going to see this for what it is, a dimwitted cable talking head trying to rationalize away a very good economy.