One can focus words on a different objective & not be lying

To The Daily Sun,

On July 2, Mr. Boutin wrote in a letter to the editor that “liberals and academics...refuse to debate objectively on the merits and substance on any issue.” In response, I offered to serve as a counterpoint on any issue of his choosing. On July 20, Mr. Boutin responded with a first “debate” assignment: “find out why Democrats keep yelling that Trump hasn’t lifted the bottom 50 percent when it’s clear from the FACTS his economy has blown Obama’s economy out of the water since the FIRST DAY he was elected” and “please investigate why Democrats like you keep LYING about Trump’s economic success”. My response follows.

Economic Facts During the Trump Presidency

Among the economic data most-oft cited by the Trump administration are various unemployment rates and earnings, stock market performance, real GDP growth, and manufacturing employment. These data show continuing gains during Trump’s presidency. The national unemployment rate and the rate for whites dropped 1 percentage point. The rate for blacks and African Americans dropped 2.8 percentage points but still remained almost twice the rate for whites. Median usual weekly earnings for whites rose at a 1.9 percent compound annual growth, slightly less than CPI inflation. For blacks and African Americans, the earnings figure was 2.9 percent. The Dow Jones Industrial Average rose by more than a third. Real GDP climbed at a 2.9 percent compound annual growth rate. And manufacturing employment grew at a 1.5 percent compound annual rate.

Interpreting the Record

Mr. Boutin’s interpretation of the Trump economic history is, “it’s clear from the FACTS that his (Trump’s) economy has blown Obama’s out of the water from the FIRST DAY he was elected”.

It is certainly true that the economy has continued to improve since Trump’s election, giving us the longest expansion on record and expansion shared by Obama and Trump. But it is difficult to contrast the economy’s performance between Obama’s and Trump’s administrations. After all, momentum is a significant factor in economic performance and Obama inherited the Great Recession while Trump launched his presidency on the heels of an already long recovery.

While public policy matters, the economy is always more a reflection of the decisions of millions of households and businesses than a president’s rhetoric, positions, and actions. There is no evidence in economic modeling of the sort of announcement effect around Trump’s election that Mr. Boutin cites. Still, over the first half of the Trump presidency unemployment rates have come down as earnings, unemployment rates, the stock market, and manufacturing employment have improved. But it is not obvious to me that median weekly earnings increases for white workers at a rate lower than CPI inflation are the mark of a robust economy. And the improvements reported in the data above are often at rates slower than during the recovery from the Great Recession on Obama’s watch.

The data do reveal that during the Trump years, black and African American median weekly earnings have grown at a faster rate than white median earnings and the drop in black and African American unemployment rates has exceeded the drop in white unemployment rates by a full percentage point.

Democratic Statements... Is Boutin Right?

Because Mr. Boutin did not reference any specific Democratic statements, I Googled “Democratic statements on Trump’s economic policy performance” to frame his proposition. Google returned several references, including Biden from late April 2019 “All of it (the tax cuts) went to folks at the top and corporations.”; Pelosi from early May 2019, “Unfortunately the evidence shows that most of the economic gains continue to benefit those already well off.”; and Harris, “Let’s call the president’s tax cut what it is: a middle-class tax hike to line the pockets of already wealthy corporations and the 1 percent.”

Did all of the tax cuts go to the top and corporations? No. Pelosi’s statement is the more accurate observation... most of the tax cuts did go to the wealthiest among us directly via lower marginal personal tax rates and a reduction in the corporate profits tax rate from 35 percent to 21 percent, to the benefit largely of equity holders, again the high end of the income and wealth distributions.

Harris’ statement on federal tax refunds was correct at the time but IRS numbers have been revised, showing essentially no change in the levels of refunds from 2018 to 2019.

Apparently to Mr. Boutin’s chagrin, Democratic statements do not emphasize continuing economic growth during Trump’s term in office. Instead, they focus on a longer-term perspective than Trump’s two and a half years in office and on a different issue: distributional equity. The distribution of income and wealth today is skewed more heavily toward the high end than at any time since the Gilded Age. And there is a growing body of evidence that that distributional inequality will be persistent, fueled by long-term returns to capital that exceed the growth rate of the economy, the transgenerational benefits of wealth, and the nature of the digital revolution. Those concerns arose before Trump, but his policies are exacerbating the issue.

“A rising tide lifts all boats” policy is may be true from the perspective of growth but it will not really address these distributional issues. The data reported above actually make that case re the Trump era... equity values have risen at a rate eight times faster than labor earnings during his time in office and equity wealth is concentrated in the wealthiest among us. Trump’s focus is on growth and metrics like the stock market.

For the Democrats, it seems to me, growth alone is not enough. For them, the benefits of growth should be fairly shared across the population and over time. Boutin’s “LYING” label is wrong. The Democrats aren’t distorting the truth, their emphasis is different: distributional equity. Reasonable men and women can and do choose different primary objectives without lying!

Final Thoughts...A Personal Perspective

First, when I initially read Boutin’s assignment, my mind went immediately to Mathew 5:7, given President Trump’s tortured relationship with the truth. Good advice. Second, as Mr. Boutin tarred me with his LYING Democrat label, in the spirit of objectivity, he should clarify and demonstrate the lies he attributes to me or recant his statement. Finally, I don’t regard Boutin’s simple declaration of “FACT” to be an objective proof statement. Mr. Boutin, please provide hard data and reasoned analysis to defend your points.

Eric Herr

Hill