VP Pence defends deficit expansion under Trump as necessary for economic growth

[GMDino]

https://www.cnbc.com/2020/02/07/pence-defends-deficit-expansion-under-trump-as-necessary-for-growth.html?__source=sharebar|twitter&par=sharebar

Quote:Vice President Mike Pence defended deficit expansion under the Trump administration during a CNBC interview Friday, saying that debt and deficits are secondary concerns compared to economic growth.


Pence, who spoke to CNBC’s Wilfred Frost at the White House on the heels of President Donald Trump’s victory lap over his acquittal in the Senate’s impeachment trial, maintained that focusing on growth will solve long-term fiscal challenges.

“The president came into office and he said, ‘First and foremost, we have to restore growth,’” Pence said.

“Deficits and debt are right in line, but it is first about getting this economy moving again and we really do believe the trajectory of this economy,” Pence said.

Pence’s remarks came less than three hours after the Labor Department released much-better-than-expected monthly payroll figures for January.

Nonfarm payrolls rose 225,000 for the month, far exceeding the 158,000 expected by a survey of Dow Jones economists. The unemployment rate ticked higher to 3.6%, but the labor force participation rate also increased 0.2 percentage point to 63.4%.

But under Trump, U.S. budget deficits have grown at a level not seen since the middle of the Obama administration, when the government was working to pull the country out of the Great Recession. The fiscal deficit topped $1 trillion in 2019, the highest level in a calendar year seen since 2012, according to Treasury Department figures released last month.

Asked about the debt-to-GDP ratio — which has grown from Obama’s tenure in the White House to Trump’s — Pence said Friday that “in a second term, we’ll continue to address those issues.”

But Trump’s belief, Pence added, is that “the real long-term solution to the fiscal challenges in Washington, D.C., is making sure the budget of every American is growing.”

“Once we get this economy rolling,” he added, “we’re going to work real hard, not just to get President Donald Trump four more years in the White House, but we’re going to make sure we have a Republican Senate and a Republican House to keep America growing and to deal with those long-term fiscal challenges.”

The economy is already rolling, according to the president’s own assessments. Trump has often called the economy under his watch the greatest in American history.

“I am thrilled to report to you tonight that our economy is the best it has ever been,” the president said in his State of the Union address Tuesday night.

Video at the link.

[fredtoast]

Trumps economy is a sham

Compare GDP growth and deficit spending over the 3 years of the Trump administration with the last three years of the Obama administration

..Budget deficit......GDP growth...Jobs added
(Obama)
2014.....$485B...…....2.5%...……..3.00 million
2015.....$438B...…….2.9%...……..2.71 million
2016.....$585B...…….1.6%...……..2.34 million
(Trump)
2017.....$665B...…….2.4%...……..2.18 million
2018.....$779B...…….2.9%...……..2.63 million
2019.....$1092B...…..2.1%...……..2.11 million

Trump has pumped up the economy with unfunded tax cuts and cash infusions from the FED

Deficit spending is okay when the economy is slow and needs a boost, but when the economy is booming like it has been that is the time to reduce deficits.  Instead the 2019 deficit is almost DOUBLE the deficit in Obama's last year in office.

[BmorePat87]

Remember when Republicans "hated" deficits? The next recession is gonna be a pain in the ass.

[GMDino]

(02-07-2020, 10:27 PM)BmorePat87 Wrote: Remember when Republicans "hated" deficits? The next recession is gonna be a pain in the ass.

I'm old enough to remember when Trump said he'd eliminate it.

[*michaelsean*]

(02-07-2020, 10:27 PM)BmorePat87 Wrote: Remember when Republicans "hated" deficits? The next recession is gonna be a pain in the ass.

Yup.  At least they used to try to act like it.

[Belsnickel]

I mean, the top line here isn't wrong; economic growth is the primary concern when compared to deficits and debt. However, deficits/debt should be used as a tool to prop up economic growth only when necessary. Right now, it shouldn't be necessary and if it is then the economy is not as strong as the administration claims.