The Republican Convention showed that the party bowed to the cult of Trump’s personality and has decided to speak only to his electoral base. Some time ago we wondered, in one of these installments, if Trump could normalize lying in the United States; and the Republican Convention last week has been, neither more nor less, a great attempt to normalize lying.
To a large extent, this is what has pushed Republican and conservative leaders such as Mitt Romney, Jeff Flake, Colin Powell, or former New Jersey and Ohio Governors, Christine Todd Whitman and John Kasich, to join the broad coalition that supports Joe Biden, to defend American democratic values, vindicate decency and even rescue the Republican party itself, founded by no less than Abraham Lincoln and today kidnapped, in a perverse acrobatic leap, by extremism encouraged by Trump’s rhetoric.
In their efforts to normalize deception and manipulation, Trump and his acolytes at the convention evaded responsibility for the appalling handling of the COVID-19 pandemic at all levels. And what is worse, they never showed empathy with the suffering of the citizens, not for the loss of lives of 180 thousand people! Nor for the resilience and difficulties in the face of the economic recession.
One of the lies of the convention points out that Trump had built a fabulous economic recovery … until the virus appeared and that, of course, there is no one better than him to return to a path of economic growth. It even intended to characterize the Democrats as dangerous socialists who would put the strength of the US economy at risk.
Let’s see what the facts say about Democrats and Republicans in relation to the economy. The Reagan-Bush era produced an important period of sustained economic growth, in the context of the end of the Cold War with an extinct USSR (Union of Soviet Socialist Republics). The economy grew at an average annual rate of 3.5% of GDP, unemployment fell to 5.5% … but at the same time, an immense fiscal deficit was accumulating, which by the end of George Bush Sr.’s first presidential term (after being Vice President of Reagan) was located above 6% of GDP, in the context of the first conflict with Iraq in response to their invasion of Kuwait. This era was characterized by substantial tax cuts to higher income sectors. However, economic growth was not enough to finance the huge deficit created by the tax cuts; and there was, then, the highest concentration of wealth and income inequality per family experienced since 1950 in the United States. In the Reagan-Bush era, public debt increased by 186%; and at the end of the Bush presidency, economic growth had fallen to an annualized average of 2.1% of GDP, while public debt grew by 54%.
The eight years of Bill Clinton’s presidency follow, which brought a stage of acceleration of economic growth, placing the annual average at 3.9% of GDP. And at the end of his presidency, the country had a fiscal surplus, while the public debt only grew 32%. In those eight years, family income inequality also began to close, and the process of wealth accumulation in the hands of 5% of the population was halted. All this was based on an expansion of the private sector, within the framework of a capitalist market system, with policies focused on guaranteeing equal opportunities in education, health and other social aspects. Unemployment reached 3.8%.
The Bush presidency brought back the economic, deregulatory and fiscal approaches of the Reagan era, with the aggravation of passing between new tensions and war conflicts at the international level (the eight years of Clinton constitute the period of greatest economic expansion in global peace in history). In 2007, the country entered a serious economic recession, after a period in which economic growth had been in the order of 2%. The fiscal deficit, amid the recession incubated by the Bush presidency, reached 9.9% of GDP in 2009, and the public debt increased by 101%. Unemployment was over 10%.
Barack Obama pulled the country out of the economic recession. This is a fact. As is also the case that he achieved that recovery with his Vice President, Joe Biden, at the head of the bipartisan legislative negotiation and administration of an economic stimulus package. In one year, Obama emerged from the recession and managed to average an annual economic growth of 2%, sustaining the growth of employment in the private sector for six consecutive years, creating three million jobs, between 2014 and 2015 (15 million new jobs in the private sector in 6 years). The fiscal deficit fell to 2.8% of GDP and public debt grew 74% (less than under Reagan and the two Bush administrations). Unemployment, at the end of the Obama presidency, fell to 4.6%. And continuing with the facts: at this stage, without risking the market and capitalist system one iota, it was possible to raise the average family income by 5.3% and real weekly wages by 4%. Additionally, more than 16 million Americans achieved health insurance coverage, under the law known as Obamacare. Meanwhile, the growth of renewable energy sources was 369% and the country began to export oil, breaking decades of dependence in this regard. The Dow Jones stock index grew from 8,000 points to 21,000 points during the Obama presidency.
Now let’s look at other facts: Trump came to the presidency with the economic boost of the Obama era. In its first year, it approved a tax cut in the order of 2.3 trillion dollars, benefiting the wealthiest economic sectors and large corporations. This produced an acceleration of economic growth that could not sustain the fiscal gap, so that the deficit doubled to 4.8% of GDP in 2019, and the public debt went from 19.9 trillion dollars in three years to 26.5 trillion dollars, that is, an increase of 32%. Let’s get on with the facts: Trump’s trade wars (with China and allies in Europe or North America) introduced important economic distortions, affecting sectors such as agriculture, where there was a serious contraction (in Wisconsin, for example, there was a record year of bankruptcies and farm repossessions in 2019), before which the federal government had to make a billion-dollar injection in subsidies, which otherwise would not have been necessary. So far the annual growth of new jobs in the first 3 years of Trump is lower than that of the last 3 years of Barack Obama.
That was the scenario when the coronavirus appeared, and we return to the facts: Trump’s handling of the COVID-19 crisis has resulted in an economic contraction of 32% in the second quarter of 2020. Unemployment reaches record figures of the order of 11%. The economic stimulus program and loans to support payroll have been applied with great delays and difficulties in access for small businesses, owned by Latino and Afro-American minorities, triggering unemployment in these sectors well above the national average (for example, still in June, more than 50% of these small entrepreneurs had not gotten access to the PPP, credit to finance their payroll). In this circumstance, marked by uncertainty and economic imbalances that impact the middle class and working class sectors, the stock markets have registered growth with immense volatility, which has reported large gains to sectors with financial liquidity or access to credit to speculate in those circumstances.
In conclusion, these are the facts: the presidencies that, in contemporary history, have achieved the highest average level of economic growth are those of Democratic presidents Johnson (5.3%), Kennedy (4.3%) and Clinton (3.9%), followed by Reagan (3.5%). When it comes to public debt, Republicans Reagan and Bush brought more growth into public debt than all other presidents from the 1960s to date. And the only two presidents who have reduced the fiscal deficit, during their constitutional terms, have been Clinton (from a deficit of 6% of GDP to a surplus) and Obama (with a reduction of 9.9% of GDP to 2.8 %). And let’s add more facts: economic inequalities deepened under Republican presidencies, and those gaps tend to decrease under Democratic presidencies. Anyway, these are the facts. Checked. They are not slogans or rhetorical attacks voiced in a sectarian and partisan convention.
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