Like everything Trump says: there is nothing behind it
Dean Baker is a Senior Economist at the Center for Economic and Policy Research (CEPR)
Cross-posted from the Center for Economic and Policy Research
A work of the U.S. federal government, it is in the public domain
When I was growing up in Chicago, a local AM radio station had a disc jockey named Larry Lujack. The introduction to his show called him “a legend in his own mind.” This keeps coming to mind with Trump’s boasting about things, big and small. The difference is that Lujack was being sarcastic.
If we can get past Trump’s boasting about ending wars that didn’t exist, or he had no involvement with, we have the story of the Trump boom. As Trump tells it, the U.S. economy is the envy of the world. He heard it from no less of an authority than the king of Saudi Arabia himself.
As Trump tells it, we have $17 trillion coming into the country. No one other than Trump seems to have any idea what he is talking about. That would be four full years’ worth of non-residential investment for reality fans.
Anyhow, Trump’s big thing has been turning around American manufacturing. Since he has shut down the government, we have limited data for anything after August. I had hoped that the Federal Reserve Board, as a quasi-independent agency (we’ll see what the Supreme Court says), would still be collecting and releasing data, but apparently not. We won’t get the release of September data on industrial production that was scheduled for tomorrow.
As a result, we might as well take a second look at the data we have from August. Here’s the picture.
If there is a manufacturing boom, Trump is keeping it hidden from the Fed. As of August, Trump’s seventh full month in office, manufacturing output was up 0.9 percent from a year earlier. That’s the right direction, but not much to boast about.
Annual growth in output averaged 1.6 percent during the eight years of the Obama administration. Growth averaged 2.5 percent annually in the decade before the Great Recession, a period in which we lost millions of manufacturing jobs.
Trump’s record looks even worse if we drill into specific categories. The computer-related sectors that are at the heart of the AI boom grew at a 13.8 percent pace over the last year. Everything else rose at just a 0.6 percent rate.
And Trump’s mantra of “drill baby, drill” does not seem to have impressed the folks in the oil fields. Oil and gas drilling is down 8.5 percent over the last year. It seems oil companies have a hard time making a profit with oil selling for $60 a barrel, and the industry has a greater commitment to making money than Trump’s goal of wrecking the planet.
Anyhow, perhaps things will turn around down the road, and we’ll be able to get the data if Trump ever decides to reopen the government, but for now we may just want to start calling Trump “Larry Lujack.”
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