By John Ubaldi
Contributor, In Homeland Security
With both the Democratic and Republican conventions convening this month, do Donald Trump and Hillary Clinton have the right policies to jump-start the listless U.S. economy? From their pronouncements about their economic policies, it doesn’t appear that way.
Friday’s job report by the Bureau of Labor Statistics showed that 287,000 jobs were created in the month of June, far outpacing the lackluster report in May. But what many people failed to see is that most of the jobs created were in leisure and hospitality, typically the lowest-paying jobs in the U.S. economy.
The report may help Hillary Clinton, but it still leaves weakness in several key battleground states such as North Carolina, Ohio, Pennsylvania and Virginia. Global competition affected these states and the drop in energy prices hurt key areas of these states.
The other challenge facing Clinton is that after eight years of Democratic control of the economy, she offers nothing new than the policies that President Obama pursued as president. Obama’s policies have resulted in the slowest economic recovery since the Second World War.
Income inequality is higher now than it was eight years ago, and public assistance and poverty rates are at record levels. These economic problems grew while a Democratic president resided in the White House. Continuing or expanding upon the current economic policies, a strategy that Clinton champions, could worsen these economic difficulties.
Does Clinton Understand the U.S. Economy?
Throughout her campaign, Clinton focused on spending billions on the nation’s infrastructure. President Obama spent almost a trillion dollars in his first term, only to benefit partisan pet projects.
The other aspect of Clinton’s economic rhetoric is a continued focus on “green” jobs and the re-vitalizing of U.S. manufacturing. The problem she fails to understand is that many of the states where she touts her manufacturing renaissance are consistently listed as the worst states to do business.
[Related article: Trump and Clinton: A Presidential Campaign of Destruction]
All of Clinton’s economic proposals have one theme in common: The wealthy need to pay “their fair share.” President Obama raised hundreds of billions in new taxes and the economy has only sputtered along. How would her rescue efforts be any different?
Clinton also fails to understand the plight of small businesses, which have been crippled by the Affordable Care Act, the Dodd-Frank Act and other regulations. For the first time, the U.S. is losing more small businesses than are entering the economy.
In May, The Economic Innovation Group (EIG) issued a report that hundreds of thousands of new businesses are missing from this economic recovery, which has seen just a 165,000 net rise in new establishments, compared to approximately 400,000 in past recoveries during the 1990s and 2000s. The collapse is not due to a spike in business closures, but a steep fall-off in the creation of new startups across wide swaths of the country—most notably outside a handful of major metropolitan centers.
Will Trump Heal the Economy or Hurt It?
In regard to the economy, Donald Trump is a different matter. He comes into the presidential campaign as a business owner and consistently speaks about how his business acumen is the right fit for “making America great again.” Trump campaigns on the moniker that he is “not bought and paid for,” but his bombastic and narcissist manner leaves little idea about how he would grow the U.S. economy.
Whenever you speak to Trump’s supporters, they mention he is a business owner and this experience would serve him well in the White House. Unfortunately, Trump’s business is family-owned, far from a standard corporation that deals with shareholders. In Washington, Trump would have to deal with a Congress from both parties who are not going to acquiesce to him, no matter what he says or does.
Throughout the campaign, Trump consistently touts how he would re-negotiate all past and current trade deals, especially NAFTA and the Trans-Pacific Partnership. Both Clinton and Trump share the same views on trade, all for different reasons.
Like Clinton, Trump never goes into any detail how this renegotiation would be implemented. How would a Trump administration respond to his aggressive “U.S. first” trade policy by our trading partners? How would a potential trade war impact the U.S. economy?
Even as Trump campaigns in the various rust belt states, he never mentions how his policies would create a new renaissance in these states. Trump does not say how he would turn the corner on bringing back more small businesses into the economy.
Trump and Clinton Strike Out on Small Business
Both Trump and Clinton seem to miss this vital component of the U.S. economy, as U.S. small businesses are now becoming extinct. What are their plans for revitalizing the entrepreneurial spirit across America?
Even with the horrific killings in Dallas on Thursday, neither Clinton nor Trump has mentioned beyond vitriolic campaign rhetoric how they would revitalize the inner cities. Many of these inner-city areas are deteriorating into a lawless quagmire, reminiscent of many third-world countries.
Whether Clinton or Trump is elected, either candidate will be reviled by most of the country. How would they govern in this highly charged partisan environment, where neither party is willing to work with the other, and compromise is seen as the ultimate betrayal?
With the conventions looming, will we get more campaign rhetoric on the economy or will we get actual policy on how we can lift the U.S. economy forward? Will the U.S. economy be consigned to be two-tiered or will it be on one level that benefits everyone?
Comments are closed.