Trump has often played down standard metrics of economic health, though, in favor of more nontraditional benchmarks such as the trade deficit or stock prices. These are generally considered shoddy ways to gauge a presidentâ€™s success. Letâ€™s humor the president, though. He only has a few days left, after all.
Unfortunately, even by his preferred, cherry-picked metrics, Trump has still been an economic failure.
Take trade, one of his signature issues. As both candidate and president, Trump repeatedly pledged to â€œend our chronic trade deficits.â€ Trade deficits, he claims, mean the United States is â€œlosingâ€ to other countries.
The balance of trade does not actually measure whether a country is â€œwinningâ€ or â€œlosing.â€ Trade balances reflect broad trends in the economy, including savings and investment rates. Additionally, when Americans buy stuff from, say, China, weâ€™re not â€œlosingâ€ the money we pay. Weâ€™re getting the products in return. Similarly, when I buy things from the supermarket, I technically have a trade deficit with the store â€” but Iâ€™m not â€œlosingâ€ in these transactions.
Letâ€™s indulge Trump, though, and assume a larger trade deficit does somehow indicate â€œlosing.â€ In that case, the United States is a much bigger loser now than when he took office: Deficits have exploded from $43 billion in January 2017 to $63 billion in October 2020.
So what happened? Trumpâ€™s trade-war â€œvictoriesâ€ have disappointed. Under the vaunted â€œphase oneâ€ China deal, for instance, Beijing committed to purchase minimum quantities of certain U.S. goods this year, with the goal of narrowing our trade deficit. Through the first 11 months of 2020, however, Chinaâ€™s purchases reached only about half of their year-to-date targets, according to Peterson Institute for International Economics senior fellow Chad Bown.
Relatedly, as trade relations have frayed, U.S. farmers have become increasingly dependent on federal support. U.S. government checks constituted 40 percent of farmersâ€™ income in 2020, according to the Agriculture Department. So much for steering the country away from â€œsocialism,â€ another Trumpian pledge.
Trump is likely to blame the pandemic recession for these trends. Which is probably reasonable â€” even if, in other recent recessions, the trade deficit shrank, rather than expanded. (As I said, trade deficits are not a good measure of economic health. Then again, Iâ€™m not the one arguing that presidents should be judged by them.)
Another poor benchmark of economic health? Stock markets. That should be obvious, given that stock prices have risen even as bread lines stretch for miles. Presidents also donâ€™t control markets, which are driven by big macro shocks beyond the commander in chiefâ€™s purview. Yet Trump has repeatedly declared equities to be a good proxy for the economy and demanded credit for their gyrations.
Here again, if you buy Trumpâ€™s premise that markets represent the economy, then this â€œeconomyâ€ was booming more under his predecessor, Barack Obama.
Between Inauguration Day and Jan. 4 of the fourth year of their respective presidencies, the stock market grew 63 percent under Trump, vs. 82 percent under Obama. Trumpkins canâ€™t even blame the pandemic for this unflattering comparison; Trump was running behind Obama for the first three years of their respective presidencies too.
Finally, Trump has touted his contributions to deregulation. He claims to have â€œremoved nearly 25,000 pages of job-destroying regulations â€” more than any other president by far in the history of our country.â€ Trump and surrogates also say theyâ€™ve eliminated 7 rules for every 1 they introduced; sometimes they further inflate the claimed ratio, saying itâ€™s 22 to 1.
Like the others, this is a silly metric for judging economic success. The content of regulations on the books is what matters, not their quantity or page length. But on his own terms, Trump has failed here too, as helpfully laid out in a recent report by researchers at the University of Pennsylvania and Rutgers University. The number of pages in the federal code of regulations is actually greater now than it was when Trump took office.
These scholars also tallied how many completed rulemaking actions were â€œderegulatory,â€ as designated by the Trump administration, and found Trumpâ€™s ratio of rules in vs. rules out to be nonsense. The overall regulatory â€œburdenâ€ is about the same as it was when Trump took office, and possibly even higher. And thatâ€™s based on the administrationâ€™s own determinations of which completed, economically significant rules are â€œderegulatory.â€
Play stupid games, win stupid prizes, the saying goes. Trump has somehow managed to play stupid games and lose the stupid prizes, too.