President Trump is leaving office with two impeachments, a banned Twitter account and a reputation in tatters. The economy isn’t doing much better.
When Trump took power in 2017, he inherited an economy that was in pretty good shape after the slow recovery of the Obama years. Employment improved further under Trump, and wages started to rise as the labor market tightened. The Trump tax cuts of 2017 included unnecessary giveaways to business and the wealthy, but they did put Americans firms on better footing by lowering the corporate tax rate. By the end of 2019 a strong economy could have clinched Trump’s reelection.
The coronavirus pandemic that erupted in 2020 wasn’t Trump’s fault. But the faltering U.S. response to the crisis was. Trump politicized and even opposed simple public health measures that could have better contained the virus and let more businesses stay open. He left cities and states to fend for themselves instead of mustering a muscular federal testing plan. Trump now takes credit for the swift rollout of vaccines, but any president would have done the same and probably more. And since losing his reelection bid in November, a petulant Trump has given up on policymaking even though pandemic deaths are hitting galling new records and the economy is backsliding.
The question now is whether incoming President Joe Biden will do better. There’s reason to think he will. Biden has no magic wand that will vanquish the virus or revive the economy. But one of his first priorities will be developing a national vaccination program with community vaccination centers, mobile units in rural areas and more federal resources than states and cities can mount on their own. Biden says his administration will also provide far more testing capability than currently exists, to isolate those who are sick and more easily open schools and businesses. Trump should have demanded this nine months ago.
Congress is also likely to pass more additional stimulus spending than if Trump were still president. Trump seemed uninterested in more stimulus spending last fall, even though it probably would have helped his reelection odds. Congress passed the latest $900 bill in December without his involvement, essentially. Many Republicans don’t see a need for more stimulus, but Democrats will control both houses of Congress starting Jan. 20, and they’ve got the checkbook out. Biden probably won’t get the entire $1.9 trillion in spending he wants, but he’ll get at least half of that, which will be a short-term boost for the economy.
Our final weekly Trump-o-meter reading is MEDIOCRE, the third-highest. This reflects tempered optimism for what Biden might accomplish, rather than disdain for the wreckage Trump is leaving behind.
Biden has told Americans to prepare for a “dark winter,” and the latest economic news is one reason why. Ten million Americans have lost their jobs since March, and job losses seem to be getting worse, not better, with new claims for unemployment insurance spiking during the past week. Oxford Economics says its recovery tracker has hit a six-month low. A drop in retail sales at the end of 2020 highlights the deep damage in parts of the consumer sector, as worried shoppers stay home. Roughly 4,000 Americans, meanwhile, die of coronavirus every day.
Biden’s presidency won’t be a cakewalk and he could easily disappoint. Republicans are a one-vote minority in the Senate and they seem likely to block as much of Biden’s agenda as they can, as they did during most of Barack Obama’s presidency. The massive federal intervention Biden favors won’t solve every problem, and the mushrooming national debt will pose a problem eventually. But Trump’s laissez-faire approach to the pandemic failed and it’s past time to try something new.
The end of the Trump presidency brings the end of the Trump-o-meter. We will, of course, closely monitor the Biden economy, and we’ll grade it on a monthly basis, as we did the Trump economy. The economy earned a B grade for most of Trump’s presidency, and it’s currently at a C. That leaves a lot of room for Biden to do better.
Rick Newman is the author of four books, including “Rebounders: How Winners Pivot from Setback to Success.” Follow him on Twitter: @rickjnewman. Confidential tip line: [email protected]. Click here to get Rick’s stories by email.
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