President Donald Trump, you may have noticed, likes to take credit. For economic growth. For defeating Isis. For steel mills opening up, for winning a World Cup bid, for boosting NFL revenue in Canada.
But there’s one thing he’s basically silent about, and it’s had a big impact, and it wouldn’t have happened without him.
That’s the Bipartisan Budget Act of 2018, the big spending bill that, as the name implies, received votes from both Democratic and Republican lawmakers.
This isn’t an argument that Trump used particularly deft lobbying to get the legislation passed. Still, it wouldn’t have happened without Trump. We know that because, for six years, Republican lawmakers were unwilling to similarly bolster spending under President Barack Obama.
The legislation enacted in February increased spending by $296 billion for the next two years, much of it on defense, ending the stranglehold on fiscal spending. It’s hard to imagine it passing under President Hillary Clinton.
It’s had a real impact. The Wall Street Journal’s Kate Davidson took apart the data recently to show how government spending has been what’s behind the pickup in economic activity.
Take a look. Durable-goods orders are up across the board, but they’re on fire for defense — a 22.7% increase year-to-date for defense capital goods, and a 19.3% improvement in defense aircraft and parts. While still strong, orders are up 8% this year excluding defense.
To anyone paying attention, it’s clear the spending bill has added as much to the economy as the more publicized tax cuts. The Congressional Budget Office, for instance, has long estimated the economic impact to be the same.
But maybe the spending increases have benefited more. Companies quite clearly have spent tax cut savings predominately on stock buybacks — $786 billion, according to a new tally released Wednesday by the Americans for Tax Fairness—which at some point will filter back into the economy, but slowly (and some will leak out to foreign shareholders)…