Trump's Economy: Now That He's President, He's Sounding More Positive About It As a candidate, Donald Trump described the economy as something of an unmitigated disaster. Now, he says, "prosperity is coming back to our shores." Is that really true?
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Now That He's President, Trump Is Sounding More Positive About The Economy

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Now That He's President, Trump Is Sounding More Positive About The Economy

Now That He's President, Trump Is Sounding More Positive About The Economy

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AILSA CHANG, HOST:

Donald Trump won the presidency last year in part by promising to revitalize the U.S. economy. After nearly seven months in office, Trump says the economy is surging. And there are signs of improvement in the stock market and the unemployment rate. But by other metrics, progress is pretty slow. NPR's Jim Zarroli reports.

JIM ZARROLI, BYLINE: Throughout his campaign, candidate Trump painted a gloomy picture of the economy. Here he was in a debate with Democrat Hillary Clinton.

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PRESIDENT DONALD TRUMP: Look. Our country is stagnant. We've lost our jobs. We've lost our businesses. We're not making things anymore, relatively speaking.

ZARROLI: At the time, the unemployment rate had been falling for years, dipping below 5 percent in early 2016. But Trump said the Labor Department numbers were fake.

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TRUMP: These are phony numbers put up by politicians to make them look good. When you hear 5 percent, then 4.9 percent, it's not the right number.

ZARROLI: The real unemployment rate, Trump said, was much higher than the government claimed.

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TRUMP: The number isn't reflective. I've seen numbers of 24 percent. I actually saw a number of 42 percent unemployment - 42 percent.

ZARROLI: Trump noted that the unemployment rate only includes people searching for work. It doesn't include all those people who've grown discouraged and quit looking. That's a point made by a lot of people, including Vermont Senator Bernie Sanders, though few of them think the real unemployment rate is as high as 42 percent.

These days, however, Trump seems to like the Labor Department's numbers a lot more than he used to.

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TRUMP: We continue to see incredible results.

ZARROLI: In his weekly address on Saturday, the president boasted that the unemployment rate in July fell to 4.3 percent.

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TRUMP: Prosperity is coming back to our shores because we're putting America workers and families first.

ZARROLI: Seven months into an administration is probably too soon to judge whether a president's economic policies are working, especially for a White House that has struggled to get its agenda off the ground. But so far, at least, Trump's claims of a resurgent U.S. economy don't really square with the data. Economist Douglas Holtz-Eakin says for better or worse, not all that much has changed since last year.

DOUGLAS HOLTZ-EAKIN: By and large, we have the same strengths. We continue to see the unemployment rate fall. We continue to see jobs created. We continue to have the same weaknesses. We don't see wages rising rapidly enough to greatly raise the standard of living.

ZARROLI: For instance, during his address in West Virginia last week, Trump cited the increase in the growth rate during the second quarter of this year.

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TRUMP: Economic growth has surged to 2.6 percent nationwide. You have to understand what that means. Nobody thought that number was going to happen.

ZARROLI: In fact, a 2.6 percent increase in growth is only a little higher than it was in the second quarter of 2016, and it's equal to the annual growth rate of 2015. Holtz-Eakin, who served as an economist under both Bushes, says some positive things are happening. The stock market is rising faster than it did. Surveys suggest consumers are more optimistic. But, he adds...

HOLTZ-EAKIN: To my eye, that's one thing. The second thing is, do they spend more money because they're confident? And the spending really hasn't changed very much. It's going on at about the same pace it did last year.

ZARROLI: Holtz-Eakin says it's the same in the business sector. Businesses say they're more confident about growth. But so far, at least, they're not putting their money where their mouth is by investing more. If that happens, Trump's claims about the economy will be more credible. Jim Zarroli, NPR News, New York.

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