Jan 25, 2020

Political dysfunction's long-term cost

The US Capitol building on Jan. 25. Photo: Alex Edelman/AFP via Getty Images

"Americans should understand that there will be a significant, long-term economic cost to our polarized politics and dysfunctional government," Washington Post economics columnist Steve Pearlstein writes on the Sunday Business cover.

The backdrop: House impeachment managers are arguing that the constitutional powers of Congress to indict a president will never function if Trump isn't found guilty of obstruction, while Trump's defense team is arguing that impeaching Trump would revoke voters' ability to judge the president for his actions.

"In the modern era, there are few if any examples of a country with a healthy, thriving economy and a broken political system. What distinguishes a successful economy from a failing one — what distinguishes Denmark from Italy and South Korea from North — is ... the laws, rules, norms and policies that create the framework in which any economy operates. ...
We can see [the] deterioration in our inability to adapt to changing conditions — the rise of China as an economic superpower, the influx of economic and political refugees, and the threat from global warming. ...
[O]ur approach has been to deny the problem, demonize those with whom we disagree and ostracize anyone who dares to compromise."
— Pearlstein, in the Post

Where it stands: Unemployment remains at a 50-year low, per the latest data from the Labor Department. But, chief financial officers are bracing for an economic slowdown this year, according to Deloitte's quarterly survey of nearly 150 executives at top North American companies.

The bottom line: "'Trump Impeachment Trial Begins. Stocks Hit New High.' If the headline sounds too good to be true, that’s only because it probably is.

Go deeper: Trump's economic shield against impeachment

Go deeper

How Trump’s economy stacks up

Source: "Presidents and US Economy", Trump figures through 2019 courtesy of Alan Blinder; Note: Data shows real GDP and Q1 growth in each term is attributed to the previous president; Chart: Axios Visuals

Average economic growth under President Trump has outpaced the growth under Barack Obama, but not all of his recent predecessors.

Why it matters: GDP is the most comprehensive economic scorecard — and something presidents, especially Trump, use as an example of success. And it's especially relevant since Trump is running for re-election on his economic record.

Trump's post-virus, pre-election boom

Illustration: Aïda Amer/Axios

The Wuhan coronavirus outbreak is already scuttling supply chains and wreaking havoc on companies around the world that do business in China, but if analysts' projections are correct, the rebound from the virus could help propel the U.S. economy to new heights right around the time of the 2020 presidential election.

Why it matters: With President Trump touting the stock market's performance and jobs growth as key accomplishments, that bounceback could play a major role in the election's outcome.

Trump impeachment trial recap, day 11: Closing arguments conclude

Rep. Adam Schiff at closing arguments. Photo: Senate Television via Getty Images

House managers and President Trump's defense team presented their closing arguments on Monday during the 11th day of the president's Senate impeachment trial.

The state of the play: The four hours of closing arguments were more for show than meant to change any minds, as Trump is all but certain to be acquitted on Wednesday.