Obama’s Legacy in Exports: 5 Years of Stagnation January 8, 2017Posted by geoff in News.
Back in 2009 and 2010, President Obama talked a lot about the importance of US exports. He even promised to double US exports within 5 years in his 2010 State of the Union address. We know, of course, that he failed to keep that promise in spectacular fashion:
In fact, you can see that during his second term we actually LOST ground in exports. From January 2012 to the November 2016 (the latest data), exports increased by 3.5%. But inflation over the same period increased by 6.6%. So we’ve really seen a reduction in the value of exports over the past 4 years.
But let’s look at a longer period of time – in fact, let’s compare the Bush and Obama legacies:
You can see that exports were on a tear prior to the recession, peaking at $165 billion. After the recession they rebounded, but pretty much stopped growing after the rebound. So 9 1/2 years after the peak in 2007, today’s exports have increased by only 12%. Again, if you adjust for inflation (~15% from 2007 to 2016), that is actually a decline in export value.
While the global economy has become increasingly competitive, it is difficult to believe that just organic growth (i.e., due to the increasing global population = +11%) and inflation (the global inflation rate from 2007 – 2015 was 42%) wouldn’t have allowed us to increase our exports more than 12%.
The president doesn’t have much of a direct influence on expanding exports – he can try to make trade agreements and create a favorable environment for exports, but in the end it’s up to businesses to make exports grow. Which is why Obama’s promise was stupid. But the president can make it more difficult for businesses to operate and sell their goods.
And it appears that’s exactly what has happened during Obama’s two terms.