The first official economic report to Congress by the current White House lay the blame for a lackluster economic recovery at the feet of the previous administration. And it is clear that the approaches of both are very different. Obama tried to regulate the economy out of a recession while Trump is seeking to deregulate the economy into growth. One thinks that big brother knows best while the other feels big brother doesn’t know much at all. And both seem eager to plant their feet firmly on their side of the tennis court rather than find a synergy that would include the best of both worldviews.
Having said that we should not assume that the claims made by either administration are true just because they say they are. Obama’s policies have been touted for providing steady growth and job creation while propping up the stock market to all-time highs. Therefore celebrating an economic recovery that did not reflect the reality of most Americans who saw none of it in their own lives. And that right there is the zeitgeist that gave us Trump. A delusional Democratic party that was painfully out of touch with the reality of most Americans while patting itself on the back about the economy with most of the so-called “recovery” finding its way to Wall Street vs. Main Street.
Their “way out” to bridge their fantasy and people’s reality was to prop up Main Street via endless unemployment benefit extensions as well as disability payments and welfare benefits. However that is called survival and not growth. That was the feeble conscious attempt by Congress and the previous administration to try to keep a lid on the rage of the populace, lest they take to the streets to actually demand justice and an equitable recovery. Occupy Wall Street was one sector’s attempt to do just that, while Trump made the successful attempt from another sector of the population.
Trump has taken ownership of some of the “good” economic indicators over the last year or so since taking office, including the all-time high stock market numbers. However as the recent severe stock market correction showed, not all is as it seems. Many had been warning that the stock market was living in an alternate reality and was absurdly overvalued, meaning that stock prices were not reflective of actual earnings reports and the underlying health of the companies.
However, due to European woes and the free money provided to big banks and major corporations by the Fed’s quantitive easing (or more aptly named “corporate socialism”), dollars were being poured into the markets as a safer alternative to volatility elsewhere and via huge stock buybacks by major corporations. And the wave of corporate optimism with the arrival of an actual “corporate president,” it was easier to turn a blind eye to the stock market bubble in hopes that fantasy might become a reality. But of course that is never the case since reality always trumps fantasy, and it took a mere change of captains over at the Fed to send the market into a tailspin over worries of inflation and unknown potential actions with regard to interest rates.
And then there was the touting of strong job numbers during the Obama years as well as Trump’s last year, even though many of those were part-time jobs or people being under-employed. And the low unemployment rates are the oldest trick in the book since the official numbers don’t account for U3, so when they say something like 7%, the truth may be closer to 20% for example. Many of those who have stopped looking for work gave up altogether because of the perverse incentives created by government benefits that make it more financially sound to stay on benefits vs. getting a part-time job or a low paying job. That is the democratic party’s way of doing business with main street. They send all the benefits to their corporate overlords while creating a system of dependency that keeps people docile with their hands out for more. But they do it because they care right?
On the other hand, Trump believes that the government knows nothing and therefore should simply get out of the way of the market altogether or at least for the most part. That is why he selected people to head the very same agencies they had vowed to do away with or severely diminish and /or cripple. Seems insane, but makes sense if that is your driving philosophy towards the government. Of course, “republicanism” is just a different mask over the same face that sucks up to Wall Street and big business while trying to pay homage to Main Street in different ways.
So one faction believes big brother knows best and should “instruct” the market via regulation on how to best serve the economy and the country, while the other faction believes the government knows nothing and should step aside and let the real heroes create economic prosperity which will spill over to the masses. Two schools of thought and both are wrong. Sensible regulation must exist to curtail the lesser nature of men while market freedom must be respected to work out problems in an organic way to help the economic garden grow and prosper. So the answer is not one or the other, it is a sensible marriage of both for the sake of all of Uncle Sam’s children.