With elections just around the corner, President Trump is encouraging people to vote for him on one basis that is he was responsible for strengthening the economy far better than his predecessors.
However, excluding the numbers affected by the pandemic, the country’s economy performed at more or less the same rate as the last three years of President Obama’s tenure.
As reported by the Bureau of Economic Analysis, in Trump’s first three years of presidency, the GDP growth rate amounted to 2.6% annually. While in Obama’s last three years it was 2.5%.
Trump had claimed that in 2017, the GDP would grow to 4, 5, and 6 percent or higher. Due to the pandemic, this year the GDP is likely to show a plunge of about 4% which is the lowest in 75 years.
In Obama’s last three years, 8.1 million jobs were added whereas, under Trump, there was a gain of 6.6 million jobs.
The unemployment rate also plunged to 3.5% even before the pandemic. Latinos, Blacks, and Asians were largely affected, their unemployment rate also dropped.
Trump has also claimed in a rally recently that the income of American households grew at a more rapid rate in his first three years than it did in Obama’s entire tenure.
Although that is correct, it does not consider that the Great Recession was taking place during Obama’s tenure and recovery only began in 2013.
Trump did manage to greatly improve one measure which is the stock market performance. In three years, the Standard and Poor’s 500 indexes saw an average growth of 14.7% annually.
However, this measure does not affect the daily lives of Americans to a great extent as only a small number of people own securities and market fluctuations do not concern them.
According to Moody’s Analytics, the prices of homes have increased by 4.8% on average as compared to 4.9% in Obama’s tenure.
Some analysts believe that a Democratic government will have a positive influence on the economy as Biden has promised to develop a green economy and plans to spend huge sums of money on development projects like roads and bridges as well.
A large amount of fiscal stimulus as well as infrastructure investment is also predicted under his tenure.
However, Biden will also increase corporate taxes and personal taxes on wealthy Americans, which could pose a potential downside.