Mitigate the Economic Impacts of the Trade Conflicts and the Coronavirus Outbreak

Abstract

Meeting the president of the Republic of Korea in September 2019, United States President Donald J. Trump bragged that the “US economy is the envy of the world”. Trump reiterated such claims in his State of the Union address in early February, hailing his own policies with typical humility. Trump touted US economic success at the Davos World Economic Forum in January as “nothing short of spectacular”, asserting “I’m proud to declare the United States is in the midst of an economic boom, the likes of which the world has never seen before.” To the contrary, US economic growth slowed after Trump started the “trade war” with China, dropping from 3.5 percent in the second quarter of 2018 to 2.1 percent in the last quarter of 2019, much less than the 5.5 percent per annum peak in the second quarter of 2014 during the Obama presidency. Meanwhile, annual growth declined from 2.9 percent in 2018 to 2.3 percent in 2019. Growth in Trump’s first three years was well below the Clinton era (1993-2000) average around 4 percent, the highest for any presidency in the last half century, although growth was even higher at times in earlier years.