The Trump Presidency

[nsacpi]

On the “affects peoples’ lives” scale, real wages/CPI has got to be up there, right? I keep bringing that up in the economics threads, to a chorus of crickets.

I find it tough to get jazzed about modest GDP growth when wages are at best stagnant. Looks like the investor class is prospering and everyone else is at best treading water.

its a boring, mundane thing to say but over the long-run what drives real wages and the standard of living is productivity growth...there is no sexy short-run policy measure that makes that accelerate suddenly...but lots of little things add up...education, incentives for saving and investment, infrastructure investment, the regulatory environment

[sturg33]

On the “affects peoples’ lives” scale, real wages/CPI has got to be up there, right? I keep bringing that up in the economics threads, to a chorus of crickets.

I find it tough to get jazzed about modest GDP growth when wages are at best stagnant. Looks like the investor class is prospering and everyone else is at best treading water.

Absolutely... But I'm not sure why these policies would fundamentally surpress wages.

Wage growth not keeping up with CPI is not good. But only way to boost is increase in productivity. We haven't had that in years and maybe now it is finally happening as referenced by the GDP growth.

People bring up the wage growth as a means to discredit the GDP growth or tax cuts... But where would we be without those. Better?

[Julio3000]

its a boring, mundane thing to say but over the long-run what drives real wages and the standard of living is productivity growth...there is no sexy short-run policy measure that makes that accelerate suddenly...but lots of little things add up...education, incentives for saving and investment, infrastructure investment, the regulatory environment

Agree, and I would add to that list a variety measures to restore bargaining power to workers.

[Julio3000]

Absolutely... But I'm not sure why these policies would fundamentally surpress wages.

Wage growth not keeping up with CPI is not good. But only way to boost is increase in productivity. We haven't had that in years and maybe now it is finally happening as referenced by the GDP growth.

People bring up the wage growth as a means to discredit the GDP growth or tax cuts... But where would we be without those. Better?

My point is that you can’t just Pangloss the economic picture.

[sturg33]

My point is that you can’t just Pangloss the economic picture.

Pangloss over what? Wage growth? Is that the only thing that matters? Would we be better off with Obama policies?

I'm not saying things are perfect but y'all using one stat to offset everything

[Julio3000]

Pangloss over what? Wage growth? Is that the only thing that matters? Would we be better off with Obama policies?

I'm not saying things are perfect but y'all using one stat to offset everything

Errr. I’m just saying let’s look at the broader picture. I think I could reasonably argue that you’re the one that’s arguing that one stat is all-important.

Big picture IMO: the economy is growing, domestically and globally. Trump’s tax cuts and deregulation have likely goosed it, though it’s fair to say the wisdom of that it debatable in macro terms. I’m just saying I’m less moved by brightsiding the current economy if real wages are stagnant or falling. You’re asking me to compare it to Obama’s presidency, and I don’t really think that’s relevant, particularly as you seem unwilling to view it in context. Further with the big picture—you’ve argued that trickle-down works. The investor class just got a significant windfall. When should we expect to start seeing the benefits trickling down?

[sturg33]

Errr. I’m just saying let’s look at the broader picture. I think I could reasonably argue that you’re the one that’s arguing that one stat is all-important.

Big picture IMO: the economy is growing, domestically and globally. Trump’s tax cuts and deregulation have likely goosed it, though it’s fair to say the wisdom of that it debatable in macro terms. I’m just saying I’m less moved by brightsiding the current economy if real wages are stagnant or falling. You’re asking me to compare it to Obama’s presidency, and I don’t really think that’s relevant, particularly as you seem unwilling to view it in context. Further with the big picture—you’ve argued that trickle-down works. The investor class just got a significant windfall. When should we expect to start seeing the benefits trickling down?

I am the only one using context to judge both terms.

I don't understand why I'm on the defensive by pointing out we had 4% GDP growth. That triggered y'all. The only thing I'm hearing is that it's not good. That the wage growth is bad and the deficit is bad. My question is, we had the same issues the last decade but didn't have this growth. Why is it a problem now?


Trickle down has worked. Everyone is better off today then they were 40 years ago. You want the windfall to be proportional, so you will never be happy.

[Metaphysicist]

Trickle down has worked. Everyone is better off today then they were 40 years ago.

This cannot possibly be the standard you are using. I could just as easily claim "stagflation worked" using the same logic.

[goldfly]

I bet the preacher will be released in turkey

The want to be dictator will get him by praising the dictator Erdogan and ask for pointers on how he turned turkey from a great country to what it is now

[50PoundHead]

GDP is most important economic factor there is and nobody said word 1 about it because it was good news. The cpi inflation data has already been discussed on this board

Because the fed isn't being overly accommodative to this admin.

I'd say the growth is more likely from reduced regulatory environment and tax cuts.

We have a spending problem. That is not new.

We have a revenue/expenditure imbalance and any legislator who voted for last year's tax bill or either of the budget bills and complains about the budget deficit is a hypocrite.

[sturg33]

We have a revenue/expenditure imbalance and any legislator who voted for last year's tax bill or either of the budget bills and complains about the budget deficit is a hypocrite.

We have a spending problem

I can post a chart and everything

[sturg33]

I bet the preacher will be released in turkey

Wouldn't that just be terrible

[50PoundHead]

Uhhh... Coming out of both of those recessions we achieved almost 15% and 20% GDP growth, respectively

The recovery from the great recession was a joke

Holy cow! If you're talking about the Great Depression and the double dip recession of 1937-38, the reason there was growth was the massive infusion of federal dollars, first in the form of the National Recovery Act (the original NRA) and the advent of World War II and all of the investment that resulted as the nation re-armed. And the reason for the recession of 1937-38 is that Congress pulled back on spending to balance the budget, which slowed economic activity. Want to put people to work? Start a massive war. Deficit as a percentage of GDP skyrocketed in both those instances, partially because GDP dropped and federal spending increased, but certainly higher than it was until the 2008 recession.

World War II doesn't get nearly the attention it should receive as a transformative agent in our economic history. Anti-New Dealers continue to claim that Roosevelt's policies didn't work and that only the war got us back on track, which would have more credence if the anti-New Dealers would have let Roosevelt policies run their course instead of prematurely balancing the budget. Where World War II had its biggest effects was in the boost to heavy industries first related to the war effort, but then re-tooled to other heavy goods, which created a jobs environment for GIs returning from the war. GIs returning from the war included a lot of country and small-town guys who flocked to the cities for the economic opportunity, leaving low-efficiency agriculture which had no future for these new jobs (which were often union jobs). This created a housing boom and more economic activity. And lest we forget, the GI bill provided education benefits which a lot of returning veterans used to improve their education status, creating a managerial class that promoted higher earnings as well.

The situation in 2009 was vastly different. I'm not going to tout the recovery as being great, but the vast differences in demography that existed in the 1930s/1940s and 2009 make them two entirely different animals.

[50PoundHead]

We have a spending problem

I can post a chart and everything

The deficit has two elements: (1) Revenue, and (2) Expenditures. If you spend more than you bring in, you have a deficit, so in that respect you are correct. But to contend that continuing to promote tax cuts doesn't add to the deficit is simply wrong. If people want less from the government and would rather have low taxes, cut spending. But then don't gripe when services go away. Same thing on the other end. If you want stuff from the government, pay for it.

I am no fan of Bill Clinton, but he left us with a balanced budget.

[nsacpi]

The deficit has two elements: (1) Revenue, and (2) Expenditures. If you spend more than you bring in, you have a deficit, so in that respect you are correct. But to contend that continuing to promote tax cuts doesn't add to the deficit is simply wrong. If people want less from the government and would rather have low taxes, cut spending. But then don't gripe when services go away. Same thing on the other end. If you want stuff from the government, pay for it.

I am no fan of Bill Clinton, but he left us with a balanced budget.

Any serious analysis of the deficit has to look at both the revenue and expenditure side. As a small-government conservative, I prefer to address it mainly by controlling expenditures. But political reality is going to dictate that both sides of the equation will have to be addressed. The other reality is the increase in the dependency ratio (mainly due to baby boomers hitting retirement age) and associated effects on both the spending and revenue side will put additional upward pressure on the deficit.

Of course, the Trump cheerleaders can exchange the high fives over 4% GDP growth. I hope some of them at least recognize it is the equivalent of a sugar high.

[sturg33]

Holy cow! If you're talking about the Great Depression and the double dip recession of 1937-38, the reason there was growth was the massive infusion of federal dollars, first in the form of the National Recovery Act (the original NRA) and the advent of World War II and all of the investment that resulted as the nation re-armed. And the reason for the recession of 1937-38 is that Congress pulled back on spending to balance the budget, which slowed economic activity. Want to put people to work? Start a massive war. Deficit as a percentage of GDP skyrocketed in both those instances, partially because GDP dropped and federal spending increased, but certainly higher than it was until the 2008 recession.

World War II doesn't get nearly the attention it should receive as a transformative agent in our economic history. Anti-New Dealers continue to claim that Roosevelt's policies didn't work and that only the war got us back on track, which would have more credence if the anti-New Dealers would have let Roosevelt policies run their course instead of prematurely balancing the budget. Where World War II had its biggest effects was in the boost to heavy industries first related to the war effort, but then re-tooled to other heavy goods, which created a jobs environment for GIs returning from the war. GIs returning from the war included a lot of country and small-town guys who flocked to the cities for the economic opportunity, leaving low-efficiency agriculture which had no future for these new jobs (which were often union jobs). This created a housing boom and more economic activity. And lest we forget, the GI bill provided education benefits which a lot of returning veterans used to improve their education status, creating a managerial class that promoted higher earnings as well.

The situation in 2009 was vastly different. I'm not going to tout the recovery as being great, but the vast differences in demography that existed in the 1930s/1940s and 2009 make them two entirely different animals.

I used these examples bc nsacpi said we didn't have GDP growth out of them.

He was wrong.

And obviously this was different than 08 but the federal government pumped tons of money into both situations

[sturg33]

Any serious analysis of the deficit has to look at both the revenue and expenditure side. As a small-government conservative, I prefer to address it mainly by controlling expenditures. But political reality is going to dictate that both sides of the equation will have to be addressed. The other reality is the increase in the dependency ratio (mainly due to baby boomers hitting retirement age) and associated effects on both the spending and revenue side will put additional upward pressure on the deficit.

Of course, the Trump cheerleaders can exchange the high fives over 4% GDP growth. I hope some of them at least recognize it is the equivalent of a sugar high.

When was the last time we cut spending? Nobody can take a balanced approach seriously bc nobody will ever cut anything. We will have a day of financial reckoning

And I lol that y'all got so triggered about merely pointing out 4% GDP growth

[nsacpi]

Dan Coats, 2.5 weeks after the Trump-Putin summit: "I'm not in a position to either understand fully or talk about what happened in Helsinki."

[nsacpi]

When was the last time we cut spending? Nobody can take a balanced approach seriously bc nobody will ever cut anything. We will have a day of financial reckoning

And I lol that y'all got so triggered about merely pointing out 4% GDP growth

Specify. All spending. Discretionary spending. In nominal or real terms? As % of GDP?

Some of it has happened. Domestic discretionary spending fell as a % of GDP under Reagan.

The reality is we have roughly 1% population growth per year. So holding spending constant is a per capita cut. And also a cut in real terms because of inflation.

We also have on a long-term basis 2% real GDP growth per year. Then roughly 2% inflation. So if spending goes up 4% per year, you hold the line with respect to how big a proportion of the economy is claimed for government purposes.

It is probably unrealistic to expect government to do things in such a rational manner, but it would make sense to bring the deficit down gradually by specifying that spending grow a bit less than 4% per year until the deficit is brought down to an acceptable level.

[cajunrevenge]

Dan Coats, 2.5 weeks after the Trump-Putin summit: "I'm not in a position to either understand fully or talk about what happened in Helsinki."

I read that they know most of what was said by intercepting Russian intelligence. Even if the conversation was innocent it is bound to still be comical.