The US economy under Donald Trump, in five key indicators

Growth, deficit, monetary policy ... Donald Trump inherited a rather favorable situation from his predecessor but he was clearly on the way to becoming the president of full employment, before the surge of Covid-19.

Until the Covid-19 pandemic, the United States economy recorded many positive indicators, starting with employment. She thus represented the main asset of Republican President Donald Trump, who is seeking a second term. But the coronavirus has caused a deep economic and social crisis.

Here are the key figures for the world's largest economy.

Unemployment

When Donald Trump crossed the threshold of the White House in January 2017, the unemployment rate was already at a low level, 4.7%.

At the time of his inauguration in January 2009, his predecessor, Barack Obama, was faced with a high unemployment rate, 9.8%, a consequence of the financial crisis.

Four years later, when the Democrat inaugurates his second term, unemployment has fallen significantly but still stands at 6.6%. Until the Covid-19 pandemic, unemployment continues to decrease, falling in September 2019 to its lowest level in 50 years: 3.5%. It will remain at this level or at 3.6% until last February.

In an effort to contain the pandemic, the population is confined, schools closed as well as non-essential businesses and air transport is drastically reduced. As a result, unemployment rose to 4.4% in March then jumped to an all-time high, reaching 14.7% the following month.

Since May, unemployment began to decline, falling to 7.9% in September.

Growth and recession

Donald Trump had certainly taken office once the economy had improved. But before the pandemic, the Trump administration had also been able to boost growth, ride on a rather favorable global economy and especially solid American household confidence.

In 2017, growth reached 2.3% when it was 1.6% in 2016, the last year of the Obama era.

In 2018, it even climbed to 2.9% before falling to 2.3% in 2019. At this rate, it remained much higher than that of other advanced countries.

With the pandemic, the United States entered a recession in the second quarter. They returned to growth in the third quarter but GDP was down 2.9% compared to the GDP in the third quarter of 2019.

The deficit and the debt

The flagship measure of Trump's tenure, the tax reform adopted in late 2017 - the most important in 30 years - reduced income taxes for the richest and slashed corporate taxes from 35% to 21%.

These measures certainly boosted growth in 2018 but they also inflated the debt and the budget deficit, which jumped by 26% for the 2019 financial year, approaching $ 1,000 billion.

With Covid-19, the deficit climbed to an all-time high in 2020, due to spending to help the economy. It exceeds 3,000 billion dollars, beating by far its previous record.

Unsurprisingly, the debt has also increased: 26.900 billion dollars for 2020 (the financial year is closed at the end of September).

The emergency assistance plan

At the end of March, Republicans and Democrats voted on the "Cares Act", a law including a gigantic emergency aid plan of 2.200 billion dollars, the largest ever adopted in the United States.

Sending a check for $ 1,200 to many Americans, granting generous unemployment benefits ($ 600 per week) and business aid limits the economic and social disaster.

In late April, Congress adopted a $ 483 billion extension, with new business loans, funds for agriculture, hospitals and Covid-19 testing.

But these aids started to expire at the end of July. And Congress failed to pass a new plan.

Central bank

The Federal Reserve and its chairman, Jerome Powell, have often been targeted by President Trump, who has long accused them of slowing the US economy by deciding in 2018 to raise interest rates.

Faced with the magnitude of the crisis caused by the pandemic, the Fed lowers its rates on March 3, 2020 in a range of 1.00 to 1.25% before lowering them again on March 16, between 0 and 0.25 %.

It has also put in place a large number of programs to inject new money into the economy and ensure that banks continue to lend money to businesses.

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