WASHINGTON (Reuters) - U.S. President Donald Trump on Friday hailed a report on economic growth as a sign that the economy was mounting a remarkable turnaround under his stewardship. The facts are more nuanced.
Following are three key remarks made by Trump following a report that the U.S. economy grew at a 4.1 percent annual rate between April and June, followed by facts based on reports by the U.S. government, companies and private economists.
TRUMP: “We’re on track to hit the highest average annualized growth rate in over 13 years.... If economic growth continues at this pace the United States economy will double in size more than 10 years faster than it would have under either President Bush or President Obama.”
FACT CHECK: Commerce Department data shows the economy has grown at a 3.1 percent annualized rate in the first half of 2018. If sustained for the rest of the year, that would be the fastest since 2005.
But economists generally expect growth will slow in coming months. That’s because the recent strength partly owes to a one-time rush by companies to export soybeans and other goods in order to avoid tariffs that took affect in July. Temporary factors have led to many bursts of growth in the past. The economy expanded at faster quarterly paces during four quarters under former President Barack Obama and in three quarters under former President George W. Bush, only to slow down afterward.
TRUMP: “We’ve added 3.7 million new jobs since the election, a number that is unthinkable if you go back to the campaign.”
FACT CHECK: It’s true the U.S. economy has added 3.7 million jobs since Trump’s November 2016 election, according to Labor Department figures. But it’s hardly unthinkable growth and is actually part of widely anticipated slowdown in job creation. U.S. payrolls have grown by an average 191,000 per month since Trump’s election, down from 219,000 per month over the prior two years. The economy has been adding jobs since 2010 and economists have expected job creation to slow, in part due to a shrinking number of jobless Americans.
TRUMP: “In the first three months after tax cuts, over $300 billion poured back into the United States from overseas.”
FACT CHECK: Following a tax overhaul approved in December, U.S. companies brought back $305.6 billion from foreign subsidiaries in the first quarter of 2018, according to Commerce Department data.
Companies did expand their capital spending in the first quarter, but the biggest American companies spent far more on dividends and share buybacks, a sign that the cash they have on hand outstripped their investment opportunities. Apple Inc., for instance, lifted its capital spending to $4.2 billion from $3 billion a year earlier but also spent a record $23.5 billion buying back its stock and another $3.2 billion on dividends.
Reporting by Jason Lange, Lindsay Dunsmuir and Daniel Burns; Editing by Andrea Ricci