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Trump dividends: Job gains, rising household incomes, risking stock values
Focus on the things that matter.
You wouldn’t know it from listening to the news these days, but President Trump’s job is not to “comment on Russia,” whatever that means. It’s to repair the health of our economy, our federal budget, our national security and a variety of other things that fall under the category of . . . actual policy.
Things that matter to you and me, and affect our lives.
We’ve gotten some indications in recent weeks of how he’s doing, and the early returns are good.
Last week, the Bureau of Labor Statistics reported that the economy added 222,000 new jobs in June. That’s better than the rate of replacement, and while we argued that it can and should be even better, it’s a good start and a welcome upgrade from the sour news we consistently saw during the Obama years.
Then Federal Reserve Chair Janet Yellin came out with the announcement that household incomes are rising, and that this is resulting in more consumer spending power. That is probably one of the factors driving another piece of good news – the steady increase in stock values.
You might not think this matters for you because you personally may not own stocks. But you can’t look at the economy that way. You have to look at it in multidimensional layers. Rising stock prices means more capital investments, which means more activity, which means more goods going from place to place . . . which might be the difference between you having a job and not having one.
That’s another element to this whole story, of course. Labor participation rates are the lowest they’ve been since the Carter Administration, and employers need the freedom to entice these people back into the labor force. The Trump Administration’s early actions to eliminate regulations on business have helped a lot, as have the actions to free up more energy resources. It will help even more when they can tackle tax reform and do something about the insanely high corporate tax rate of 35 percent.
Unfortunately, a lot of this is tied up in Congress. Some of that owes to how difficult it’s proven to repeal ObamaCare (or how difficult the Republicans have made it, I should say), and some of it is because Chuck Schumer has intentionally manipulated Senate procedures to prevent things from getting done.
Even so, the early returns are very encouraging. What they are not is surprising. Many of us said all along that these were the exact moves needed to turn around a sluggish economy that consistently produced substandard growth and job creation. President Trump deserves credit for winning the presidency and putting these policies in place – and for listening to the right advisors, the ones saying what we’ve been saying here for years.
What’s astonishing is how many forces in Washington are lined up to do anything they can to prevent these policies from being implemented, whether we’re talking about resistance in Congress or sabotage from within the executive branch. Washington is supposed to be the place where people go to serve the public. It has become the place that does everything it can to oppose the best interests of the public.
But Donald Trump is a disruptor, and these are the things we sent him there to disrupt. Even though he’s only been able to put a fraction of his preferred policies in place so far, the results are encouraging.
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