A few weeks back, Michael Snyder at The Economic Collapse blog looked at U.S. GDP growth rates for the ten years 1930-1939 and the ten years 2007-2016. I didn’t verify his numbers but they seem plausible (referring to “real” or inflation-adjusted GDP). Snyder says:
When you average all of those years together, you get an average rate of economic growth of 1.33 percent.
That is really bad, but it is the kind of number that one would expect from “the Great Depression”.
So then I looked up the numbers for the last ten years…
When you average these years together, you get an average rate of economic growth of 1.33 percent.
The same! But wait, averaging them isn’t quite right. For math-y reasons, it’s better to take a starting index value like 100, then apply the growth rates year by year. I did that, and
- Real GDP grew 10% from 1930-1939.
- Real GDP grew 14% from 2007-2016.
Still not much difference! The point remains that the last 10 years have been super lame. President Obama was perhaps the first in U.S. history to never have a single year of real GDP growth over 3%.
And it’s possible that Obama’s record was yet worse. Remember, in recent years they’ve been padding the GDP numbers. They directly added nonsense to GDP. They also under-estimate inflation, which artificially boosts the growth estimates.
But for now, let’s stick with official numbers (where Obama’s overall record is nearly as bad as a Great Depression), and pivot to look at unemployment.
You may wonder: if we’ve been in a depression, how could the unemployment rate be down at 5%? The difference from the 1930s is that, in our time, the Establishment (or Political-Financial Complex) has been determined to fool people – to boil the frog (us) slowly, so to speak – and to cover for President Lightworker. Thus,
- They let him jack the national debt from $10 trillion to $20 trillion. Even a monkey could make GDP seem halfway-OK for 8 years, if you gave him a $10 trillion credit card.
- They had the central bank (Federal Reserve) conjure trillions of new money from thin air and inject it into the financial markets. It’s chicanery, but people say “At least my home and 401k are up.”
- And they baked the unemployment statistics. Remember, the official 5% number hides a huge decline in Labor Force Participation, plus full-time jobs being replaced with crappy part-time jobs.
- If you add back the people who left the labor force in despair these last ten years, real unemployment is 11-12%.
- And if you add the extra part-timers (assuming they would rather be full-time), it’s even worse.
Depression 2.0 has been with us, all this time. It’s part of why people were so unhappy with Queen Cersei in 2016 (who ran as the Establishment’s poster child).
What does all this bode for President Trump? Probably not well.
- He’s trimmed back some of Obama’s growth-killing regulations. That will help.
- And his infrastructure spending may go to productive works (unlike Obama’s 2009 “Porkulus” package), if he can get it passed. He wants to revive American manufacturing, which would be good.
- BUT, with so much debt on the books and so many Americans expecting handouts, our underlying economic problems are worse than ever.
Trump has inherited a sinking ship. The next recession should be a roller-coaster. If the American Left is krazy and violent now, just you wait.
Then again, maybe our leadership will hit on the solution quickly (a Free Enterprise system with smaller government, Rule of Law, sound money, cutting the Welfare-Warfare State, letting Washington and Wall Street fail, letting Main Street pick up the pieces). And maybe our leadership will use the media skillfully (plus a few well-placed arrests) to transition people’s minds to all that. Don’t tell me I’m dreaming.
OK, I’m dreaming. Time to buy more ammo.