Fact Checker: Trump’s misleading spin on the 2018 GDP growth rate
By Glenn Kessler Glenn Kessler The Fact Checker Email Bio Follow March 25 at 3:00 AM “We just came out with numbers … 3.1 percent GDP. The first time in 14 years that we cracked 3, right? That’s pretty good — 3.1. The press tried to make it 2.9. I said, ‘It’s not 2.9.’ What they did is they took odd months. I said, ‘No, no, no. You go from January to December. You don’t take certain months and add them up.’ Because I said, ‘We’re going to break 3.’ And we did. We did 3.1.
The problem for Trump is that he had hoped to beat 3 percent growth. So 2.9 percent would be a bit of a bummer, especially because President Barack Obama achieved that result in 2015. “I think most economists prefer four-quarter changes to annual averages,” Furman said. “As I’ve written before, the problem with annual average is that the annual average for 2018 reflects data on quarterly growth in 2017 and 2018. So it doesn’t tell you what is actually happening in a given year or, say, as a result of the tax cuts.”
Now that Trump is citing 4Q/4Q, that means the relevant comparison would not just be 4Q/4Q but other quarter-over-quarter calculations. The economy under Obama hit its peak in 1Q/1Q 2015, when it grew 3.8 percent. Obama exceeded 3.1 percent on two other occasions, as well. Obama’s nadir was reached in 2Q/2Q 2009, when the growth rate was -3.9 percent.
Trump’s CEA offers a compelling case that 4Q/4Q is a better gauge for measuring GDP growth within a calendar year, and it acknowledges that the 2.9 percent growth rate is the measure for year-over-year growth. But such nuances appear to have been missed by the president. If he just stuck to the numbers, without the braggadocio and press bashing, he’d be on more solid ground. The economy is doing well enough that there’s little need to spin the data further.
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