December Disaster
Year-end jobs reports shows the "Trump miracle" is a mirage
Photo by Edu Lauton on Unsplash
The Trump Tax Cuts Have Failed Bigly.
The evidence was already in that the Trump tax cuts had failed bigly. Despite Trump’s promises of “skyrocketing” GDP growth, the rich and corporations didn’t actually invest their newfound trillions in creating jobs. They either pocketed the cash or spent it on stock buybacks. So while Wall Street is doing fine and “409Ks” are up, the poor and middle class are struggling more than ever. Meanwhile, the annual deficit (which was falling under Obama) has soared back to $1 trillion, and the national debt that Trump promised to eliminate in 8 years has risen to more than $23 trillion.
If you were worried that the December jobs report would be bad, you had your worst fears confirmed and then some:
Only 145,000 jobs created — below estimates of 160,000.
Wage growth was lowest since mid-2018.
Hourly earnings disappointed, pushing down the annual gain to 2.9% from 3.1%.
Hiring in full-year 2019 was the slowest since 2011.
The disappointment was made even worse by the fact that there were no mitigating factors. As USA Today noted:
Several temporary factors were expected to boost job growth last month. Snowfall across the country was unusually light, reversing harsh weather in November that crimped gains in industries such as construction, retail and leisure and hospitality, Goldman Sachs said in a research note.
Also, the late Thanksgiving meant many seasonal workers who weren’t counted in the November employment survey – which was conducted mid-month – were tallied the following month, Goldman says.
So there’s no real excuse for the December jobs report. The real explanation is that the “Trump miracle” is in fact a mirage. Trump’s economic mismanagement and misguided trade wars have actually set the stage for a Trump recession as we head into 2020.
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