It’s still the economy
As a top strategist in Bill Clinton’s 1992 campaign against President George H.W. Bush during a recession, Democrat political consultant James Carville coined the phrase “It’s the economy, stupid” and prominently posted it in the campaign’s Little Rock headquarters to keep the operation focused.
Clinton’s three primary messages — “It’s the economy, stupid,” “Change vs. more of the same” and “Don’t forget health care” — concentrated the campaign and produced a lopsided win of 370-168 in the Electoral College.
During the recent presidential campaign and now with the key problems facing the incoming administration, it’s much the same story. It’s still the economy.
With the anemic average annual economic growth during the Obama presidency, slightly more than just half what it was from the end of World War II to 2008, it’s now taking nearly twice as long to double the size of the economy as in the seven post-World War II decades — 21 years to double the GDP in the post-war period versus 40 years now.
The cost of the economic slowdown and snail’s-pace GDP growth during President Obama’s two terms, nationally and per household, was summarized in Investor’s Business Daily’s Nov. 7 report, “It’s Still the Economy, Stupid; How Next President Can Return U.S. to Robust Growth”: “If growth since 2008 had merely been average for recoveries since World War II, the economy would be $2.2 trillion larger than it is now. Each household would have, on average, $17,000 more in income. And we’d have about 6 million more jobs.”
To turn stagnation into a growth economy, the Trump administration and Congress face extensive problems and obstacles: Federal debt of $20 trillion ($166,000 per taxpayer); steeply rising entitlement spending; federal expenditures up 118 percent since 2000; crumbling inner-city economies; stagnating labor productivity, business investment and household incomes; internationally uncompetitive corporate tax rates; anti-business attitudes and edicts; anti-growth ideologies; overly burdensome regulations; entrepreneurs dispirited by state-erected impediments and hurdles; an often wasteful and badly focused educational system; and 47 million Americans below the poverty line.
The Federal Register, which daily prints the U.S. government’s proposed and final rules and regulations, is expected to exceed 90,000 pages for 2016, up from 80,260 for 2015.
The “It’s Still the Economy, Stupid” report cites the regulatory price: “In its annual report, ‘Ten Thousand Commandments: An Annual Snapshot of the Federal Regulatory State,’ the Competitive Enterprise Institute notes that regulations imposed by more than 60 federal departments, agencies and commissions impose what it calls a ‘hidden tax’ of $1.9 trillion on the U.S. economy — or roughly $15,000 per household per year.”
Additionally, the vast U.S. tax code — 2.4 million words, plus 7.7 million words of clarification — will cause Americans this year to spend an estimated 8.9 billion hours and $409 billion filling out their taxes, according to the Tax Foundation. That’s just the cost of compliance, not the cost of taxes paid.
Ralph R. Reiland is associate professor of economics emeritus at Robert Morris University and a local restaurateur (email@example.com).