The U.S. Economy Was on Weak Footing Before the Coronavirus
April 2, 2020
The coronavirus crisis hasn’t stopped Trump from lying about his economic record. While he continues to claim that we had “the greatest economy” before the coronavirus hit, the truth is that Trump’s policies created a fragile economy that was especially vulnerable to the downturn that resulted from the coronavirus outbreak.
Trump has recently claimed that before the coronavirus pandemic, the U.S. had “the greatest economy” ever because of him.
TRUMP: “We had the greatest economy in the history of the world until we got hit by this problem.”
TRUMP: “Our country was at its strongest financial point. We’ve never had an economy like we had just a few weeks ago, and then it got hit with something that nobody could have ever thought possible.”
TRUMP: “We had the greatest economy that we’ve ever had, and we didn’t have death.”
But recent data on skyrocketing business debt shows the economy was already on weak footing before the pandemic hit.
Washington Post: “The coronavirus crisis is exposing how the economy was not strong as it seemed”
Washington Post: “Along with dealing millions of Americans an unexpected blow, the pandemic exposed vulnerabilities that had accumulated during a record-long expansion and years of ultralow interest rates.”
The manufacturing sector was already reeling from Trump’s trade policies, and its contraction in March was the sixth decline in eight months.
Associated Press: “Manufacturing contracted in the United States and around the world last month, dragged down by economic fallout from the coronavirus outbreak. … Already weakened by President Donald Trump’s trade war with China, manufacturers around the world are reeling from COVID-19 and its economic impact.”
Construction spending, especially nonresidential construction like manufacturing facilities, declined sharply in February — before the economic impacts of coronavirus hit the U.S.
Associated Press: “Spending on U.S. construction projects fell 1.3% in February with housing and nonresidential construction both showing weakness even before the coronavirus struck with force in the United States.”
The fallout from coronavirus is only exacerbating the financial hardships farmers were already facing because of Trump’s erratic trade policies.
CNBC: “U.S. farmers have endured a slew of financial hardships over the past few years. The U.S.-China trade war sent scores of farmers out of business. … Now, the coronavirus pandemic has dealt another blow to a vulnerable farm economy.”
Iowa Farmer: “We were already under extreme financial pressure. With the virus sending the prices down — it’s getting to be the straw that broke the camel’s back.”
U.S. companies cut tens of thousands of jobs in March even before the worst of the coronavirus outbreak’s economic slowdown.
CNBC: “US companies cut 27,000 jobs before the worst of the coronavirus shutdown, millions more coming, Moody’s says”
Business investment declined again in February, suggesting the economy was already heading toward recession before the full impact of coronavirus emerged in the U.S.
Reuters: “New orders for U.S.-made goods were unexpectedly flat in February, and could remain weak as a global coronavirus outbreak strains supply chains and undercuts the manufacturing sector.”
Reuters: “New orders for key U.S.-made capital goods fell sharply in February as demand for machinery and other products slumped, suggesting a deepening contraction in business investment that analysts said signaled the economy was already in recession.”