President Trump has a new “greatest ever” to brag about, in the final days of the 2020 election. But his performance on economic growth is still the worst of any president during the last 50 years.
Third-quarter GDP grew by 33.1% on an annualized basis—the biggest jump in economic growth on record. “GDP number just announced,” Trump tweeted on Oct. 29. “Biggest and Best in the History of our Country. So glad this great GDP number came out before November 3rd.”
Annualized growth is a measure of one quarter’s performance if the economy had grown at the same pace all year. On a quarter-to-quarter basis, GDP grew by a much smaller 7.4% in the third quarter. These numbers are out of whack because of the business shutdowns triggered by the coronavirus pandemic, beginning in March. First-quarter GDP growth fell, then second-quarter growth plummeted. The huge jump in third-quarter growth makes up some but not all of the lost economic activity from earlier in the year. The U.S. economy remains in a hole, however.
[See how the Trump economy went south once coronavirus hit.]
Yahoo Finance has been tracking the Trump economy compared with six prior presidents, going back to Jimmy Carter in the 1970s. Even with the sharp third-quarter improvement, Trump still has the worst performance on real GDP growth, adjusted for inflation, of any of the seven presidents. We use data provided by Moody’s Analytics to measure the Trump economy on six metrics, compared with the economy under six prior presidents at the same point in their first term. We adjust GDP for population growth, to get an apples-to-apples comparison. For GDP, we use an index for each president that begins at 100 at the start of their term, with the latest index number representing a percentage increase or decrease compared with 100. Here’s where Trump stands:
Trump’s latest index reading is 101.54, meaning real GDP per capita has grown by 1.54% since he took office. That’s a lot better than the second-quarter data, which showed GDP had dropped by 5.3% under Trump. But Trump’s number is still the lowest of any president we measure. The next worst performance was 2.4% growth at the same point in George H.W. Bush’s first term in 1992, followed by 4.2% growth under Barack Obama in 2012. The best performance was 8% growth under Bill Clinton in 1996.
Overall, Trump earns a C grade on our Trumponomics Report Card. He scores dead last for GDP growth, total employment and exports. But he gets the top mark for earnings growth, helped in part by a coronavirus anomaly: companies have laid off more lower-paid workers than higher-paid ones during the last six months, which has pushed the average earnings of those who are still employed higher.
Trump does a bit better than average on manufacturing employment, which has dropped by about 164,000 jobs since he took office. But manufacturing job losses were worse under President Obama, both Bush presidents and President Reagan as they all sought reelection. Stock-market returns under Trump have been middling, with the S&P 500 index doing better under Obama, Clinton and George H.W. Bush.
Voters who still haven’t cast a ballot are unlikely to be swayed by a single economic data point, especially one as anomalous as a huge spike in GDP following an epic decline. More important is whether they feel the economy is getting better or worse, or stagnating, and whether they blame Trump for the recession.
Trump’s marks on handling the economy have dropped, with Biden’s rising as the coronavirus recession drags on. In some polls they’re essentially tied, which is bad news for Trump, who gets strongly negative ratings for his handling of the coronavirus. Since the pandemic and the recession are obviously linked, Trump’s low marks on handling the virus could outweigh middling marks on the economy.
Consumers also remain fairly gloomy, with only a modest improvement in confidence in recent weeks. Morning Consult’s consumer-sentiment index is about 11 points higher than the low point in April, but still 23 points below pre-pandemic levels of February. That mirrors Trump’s problem on GDP and the economy overall: Things are getting better, but they’re still a lot worse than they were eight months ago, before the coronavirus became the most important issue in the 2020 election.
Rick Newman is the author of four books, including “Rebounders: How Winners Pivot from Setback to Success.” Follow him on Twitter: @rickjnewman. Confidential tip line: firstname.lastname@example.org. Encrypted communication available. Click here to get Rick’s stories by email.