The United States is getting ripped off due to tariffs and bad trade deals to the tune of $800 billion each year. This deficit each year has cost the U.S. manufacturing sector thousands of jobs and a $800B reduction in Gross Domestic Product. I have been involved with the closure of two manufacturing plant each with 1,500 plus jobs. One of the manufacturing plants moved to Mexico as a results of the North American Free Trade Agreement. The other moved to China.
President Trump is the only president in my lifetime that has had the intestinal fortitude to challenge the trade deficit and the tariffs that have been place on our goods by other countries. His challenges are made in an effort to return manufacturing jobs back to the United States to help the average working American. If the trade deficits were lowered there would several thousand more manufacturing jobs available in the U.S.
The economy is impacted by three things: fiscal policy, monetary policy, and jawboning (rhetoric). Rather than establishing fiscal policy that caused the economy to grow as President Trump has done; President Obama’s fiscal policy placed downward pressure on the economy causing the United States to have the longest period of a slow growth economy since 1949. President Obama is a charismatic and masterful orator, but with all his jawboning he had little to no impact on the US economy.
Many talk about the stock market growth during the Obama era. The stock market growth was caused by monetary policy. The Federal Reserve System controls monetary policy. It was the Federal Reserve that kept the interest rate at zero or near zero, historical lows. The Federal Reserve undertook a program called Quantitative Easing. Under Quantitative Easing the Federal Reserve bought US Bonds. The purchasing of bonds place large sums of money into the economy. With interest rates so low, there was nowhere but the stock market for the money to flow into. It is the money from the Federal Reserve’s Quantitative Easing programs that caused the growth in the stock market, nothing that President Obama did had an impact.
The unemployment rate has been kept low because people quit searching for work and left the labor market causing the labor participation rate to be at its lowest level since 1977. President Obama’s increasing the number of people on entitlement programs further impacted the labor participation rate.