Letter: Economic voodoo
This past week Donald Trump and his core of economic advisors employed the corporate news media to spread the news about the 4.1 percent economic growth or Gross Domestic Product (GDP) for the second quarter (April through June) of 2018. They bragged how the $1.5 trillion tax cut allowed companies to expand and hire more people. There were claims that American consumers had wads of extra cash to spend on automobiles and other products.
I don’t see how that is possible. Wages actually declined in 2018. The increased costs of health insurance, gasoline and rent would wipe out any tax cuts for Main Street Americans.
Economic experts point to the rush of exports that contributed to the economic growth and not consumer spending. The rush of exports and corporate spending was designed to get ahead of the coming Trump tariff wars. Some media outlets continued to embellish the economic growth at the top of the economy. By the top of the economy, I am referring to the establishment economy that represents the wealthy 1 percent and Wall Street.
The problem is that Trump believes in his fake economy, but then Trump has never lived in the real world. The establishment economy will slow in the third and fourth quarters. Trump’s tariff wars and a huge national debt will most likely cause an economic recession or depression by 2019 or 2020. GDP does not trickle down to Main Street America. It all stays at the top. GDP is an old, outdated economic measurement that no longer has relevance for Main Street America especially since the Great Recession of 2008.
The poverty guidelines are old and outdated. Today, the lower half of the middle class is living in poverty. The real bottom line for America is this: There is no way that the American economy can be good when we have over 40 million Americans on food stamps. As one American worker said a few days ago, “You can’t eat GDP.”