Trump and Obama claim the merit of the economic bonanza during the campaign



The US president, Donald Trump, and his predecessor in office, the Democrat Barack Obama, dispute the merit of the current situation of economic boom in the days leading up to the legislative elections next Tuesday.

The old electoral adage of "It's the economy, stupid" has become the mantra repeated over and over again by Trump on his hectic tour of the country to support Republican aspirants to the House of Representatives and the Senate.

"We have the best economy the country has ever had and it is still improving (...) You just have to look at the numbers," Trump said at a recent election in Montana and with his usual penchant for hyperbole.

Trump assures that the economic acceleration is a consequence of his aggressive fiscal stimulus, composed of strong tax cuts to the companies and to a lesser extent to the workers, approved at the beginning of the year, as well as of his federal deregulation agenda.

He also warns that, if the democrats return to power, the economy would stop in its tracks.

The indicators show that the first world economy enjoys a golden moment, but they are far from reflecting historical records.

The unemployment rate stood at 3.7% in October, the lowest in almost half a century.

Economic growth data are less surprising, since the 3% forecast for 2018 was already reached in 2010 and 2015 and exceeded in 2004 and 2005.

Conscious of the good economic moment, the strategy of the democratic side is based not so much in questioning the economic robustness, but in claiming its authorship.

Former President Barack Obama, who has also thrown himself squarely into the electoral battle, has assured that the bases of the economic recovery were established under his mandate and that Trump has simply inherited the wave of bonanza.

"I think it's interesting, people should know that there is a pattern in which they (the Republicans) destroy things and then we have to come (the Democrats) and fix them," Obama said last week at a rally in Nevada.

Obama stressed that when he left office, "wages were rising, the rate of people without health insurance going down and poverty falling."

"And that's what I left to my successor, so when you hear all those speeches about economic miracles now, remember who started them," he said.

Trump's criticisms not only address the Democratic opposition, but also point to an unusual goal: the Federal Reserve (Fed).

Against the traditional respect for the independence of the central bank by the tenants of the White House, Trump has charged repeatedly against the rises in interest rates.

"I'm not happy," said Trump, referring to the monetary policy of Fed president Jerome Powell.

For Trump, who has called himself "the king of debt," the gradual rise in the price of money threatens to "slow down" economic growth.

Powell was elected by Trump to head the Fed to replace Janet Yellen, who had been named by Obama and considered himself more supportive of maintaining monetary stimulus.

Interest rates are currently between 2% and 2.25%, at levels not seen in a decade, and a new rise is expected, the fourth of the year, at the last meeting of this year.

For now, the Fed ignores criticism from the White House. Last week, Richard Clarida, vice president of the central bank and also appointed by Trump, defended the monetary path underway.

"If the data is what we expect, I think a further gradual adjustment in interest rates will be appropriate," he said in his first public speech.

To the question of whether Trump's words question the independence of the Fed or condition their decisions, Clarida answered categorically: "No".

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