I
keep hearing that although Trump is a scoundrel or worse, at least he’s
presiding over a great economy.
As White House
economic adviser Larry Kudlow recently put it, “The single biggest story this
year is an economic boom that is durable and lasting.”
Really? Look
closely at the living standards of most Americans, and you get a very different
picture.
Yes, the stock
market has boomed since Trump became president. But it’s looking increasingly
wobbly as Trump’s trade wars take a toll.
Over 80 percent
of the stock market is owned by the richest 10 percent of Americans anyway, so
most Americans never got much out of Trump’s market boom to begin with.
The trade wars
are about to take a toll on ordinary workers. Trump’s steel tariffs have cost
Ford $1 billion so far, for example, forcing the automaker to plan mass
layoffs.
What about
economic growth? Data from the Commerce Department shows the economy at full
speed, 4.2 percent growth for the second quarter.
But very little
of that growth is trickling down to average Americans. Adjusted for inflation,
hourly wages aren’t much higher now than they were forty years ago.
Trump slashed
taxes on the wealthy and promised everyone else a $4,000 wage boost. But the boost
never happened. That’s a big reason why Republicans aren’t campaigning on their
tax cut, which is just about their only legislative accomplishment.
Trump and congressional Republicans refuse to raise the minimum wage, stuck at $7.25 an hour. Trump’s Labor Department is also repealing a rule that increased the number of workers entitled to time-and-a-half for overtime.
Yes,
unemployment is down to 3.7 percent. But jobs are less secure than ever.
Contract workers – who aren’t eligible for family or medical leave,
unemployment insurance, the minimum wage, or worker’s compensation – are now
doing one out of every five jobs in America.
Trump’s Labor
Department has invited more companies to reclassify employees as contract
workers.
Its new rule undoes the California Supreme Court’s recent decision requiring that most workers be presumed employees unless proven otherwise. (Given California’s size, that decision had nationwide effect.)
Its new rule undoes the California Supreme Court’s recent decision requiring that most workers be presumed employees unless proven otherwise. (Given California’s size, that decision had nationwide effect.)
Meanwhile,
housing costs are skyrocketing, with Americans now paying a third or more of
their paychecks in rent or mortgages.
Trump’s
response? Drastic cuts in low-income housing. His Secretary of Housing and
Urban Development also wants to triple the rent paid by poor households in
subsidized housing.
Healthcare costs
continues to rise faster than inflation. Trump’s response? Undermine the
Affordable Care Act. Over the past two years, some 4 million people have lost
healthcare coverage, according to a survey by the Commonwealth Fund.
Pharmaceutical
costs are also out of control. Trump’s response? Allow the biggest pharmacist,
CVS, to merge with the one of the biggest health insurers, Aetna – creating a
behemoth with the power to raise prices even further.
The cost of
college continues to soar. Trump’s response? Make it easier for for-profit
colleges to defraud students. His Secretary of Education, Betsy DeVos, is
eliminating regulations that had required for-profit colleges to prove they
provide gainful employment to the students they enroll.
Commuting to and
from work is becoming harder, as roads and bridges become more congested, and
subways and trains older and less reliable. Trump’s response? Nothing.
Although he promised to spend $1.5 trillion to repair America’s crumbling infrastructure, his $1.5 trillion tax cut for big corporations and the wealthy used up the money.
Although he promised to spend $1.5 trillion to repair America’s crumbling infrastructure, his $1.5 trillion tax cut for big corporations and the wealthy used up the money.
Climate change
is undermining the standard of living of ordinary Americans, as more are hit
with floods, mudslides, tornados, draughts, and wildfires.
Even those who have so far avoided direct hits will be paying more for insurance – or having a harder time getting it. People living on flood plains, or in trailers, or without home insurance, are paying the highest price.
Even those who have so far avoided direct hits will be paying more for insurance – or having a harder time getting it. People living on flood plains, or in trailers, or without home insurance, are paying the highest price.
Trump’s
response? Allow more carbon into the atmosphere and make climate change even
worse.
Too often,
discussions about “the economy” focus on overall statistics about growth, the
stock market, and unemployment.
But most
Americans don’t live in that economy. They live in a personal economy that has
more to do with wages, job security, commutes to and from work, and the costs
of housing, healthcare, drugs, education, and home insurance.
These are the
things that hit closest home. They comprise the typical American’s standard of
living.
Instead of an
“economic boom,” most Americans are experiencing declines in all these
dimensions of their lives.
Trump isn’t
solely responsible. Some of these trends predated his presidency. But he
hasn’t done anything to reverse them.
If anything,
he’s made them far worse.
Robert
B. Reich is Chancellor's Professor of Public Policy at the University of
California at Berkeley and Senior Fellow at the Blum Center for Developing
Economies. He served as Secretary of Labor in the Clinton administration, for
which Time Magazine named him one of the ten most effective cabinet secretaries
of the twentieth century. He has written fifteen books, including the best
sellers "Aftershock", "The Work of Nations," and "Beyond
Outrage," and, his most recent, "The Common Good," which is
available in bookstores now. He is also a founding editor of the American
Prospect magazine, chairman of Common Cause, a member of the American Academy
of Arts and Sciences, and co-creator of the award-winning documentary,
"Inequality For All." He's co-creator of the Netflix original
documentary "Saving Capitalism," which is streaming now.