Experts: The So-Called ‘Trump’ Economy Is Still Very-Much Obama's

Gage Skidmore/Flickr

"2017 was largely an Obama economy." -Mark Zandi, chief economist at Moody's Analytics

Perhaps the most often touted accomplishment of President Donald Trump during his first year in office is the state of the stock market and overall economy, with the president himself tweeting regularly how well the U.S. is doing.

But most experts agree that Trump's first year is more a lingering effect of President Barack Obama's administration than evidence of his own accomplishments, and Americans tend to agree, with polls showing that 49 percent credit Obama versus the 40 percent handing kudos to Trump.

What's more, economic experts are not certain that the level of growth is sustainable.

Growth has picked up, but it's not yet clear if it can sustain a faster expansion. Hiring and wage growth actually slowed slightly from Obama's last year in office. Consumers and businesses are much more optimistic, but their spending has yet to move meaningfully higher.

Some economists believe consumer reports have become so influenced by political leanings as to discredit their usefulness:

People in Trump-voting counties were much more likely just after the election to say their financial situation had improved in the past year, the New York Fed said, long before any of Trump's policies were in place. But the change in sentiment didn't produce changes in consumer spending, the report said.

"It does somewhat undermine the message from the confidence surveys," said Jim O'Sullivan, chief U.S. economist at High Frequency Economics.

In the end, it remains to be seen what will happen with the economy under Trump. The Republican tax plan, along with a shift toward deregulation, has increased speculation that 2018 will see an increase in economic growth.

"There's just generally the feeling that there's more pro-growth policy coming from Washington," [Jim O'Sullivan, chief U.S. economist at High Frequency Economics] said.

But Trump continues to push the notion that his policies are responsible for the continued improvement in 2017.

"We have created more than 2 million new jobs since the election," Trump said earlier this month in Nashville, Tenn. "Economic growth has surged past 3 percent, something that wasn't supposed to happen for a long time. We're way ahead of schedule. Unemployment is at a 17-year low."

But the numbers Trump cites are similar to what they had been under Obama:

Those trends aren't very different from what came before. Employers added more jobs in Obama's last year in office — 2.2 million in 2016 — and nearly 3 million in 2014. Economic growth did top 3 percent at an annual rate during the second and third quarters of 2017. But it had surged above 4 percent in the second and third quarters of 2014.
...

"2017 was largely an Obama economy," Mark Zandi, chief economist at Moody's Analytics, said. "But going forward it will definitely be a Trump economy."

Comments