Oh, Trump. He loves claiming credit for things with which he had nothing to do, like small words and common phrases, along with the economy and the stock market. Good jobs report? All thanks to him. Stock market gains? Well, thank him for that, too. National debt down by trillions? All him, because the stock market is way up.
You read that right. In a friendly, softball interview with permanently shit-stained fanboy Sean Hannity, Trump said:
“The country — we took it over and owed over 20 trillion. As you know the last eight years, they borrowed more than it did in the whole history of our country. So they borrowed more than $10 trillion, right? And yet, we picked up 5.2 trillion just in the stock market. Possibly picked up the whole thing in terms of the first nine months, in terms of value. So you could say, in one sense, we’re really increasing values. And maybe in a sense we’re reducing debt.”
Yeah…no. The stock market and the national debt have very little to do with one another. The only way the stock market can even have a hand in paying down the national debt is through taxation on sales. The $4.4 trillion gain in the market does not mean we’ve magically paid down over $4 trillion in debt.
It doesn’t even do it “in a sense,” the way he says. Stock prices reflect the wealth of publicly traded companies. The national debt reflects government spending over and above its income. The only relationship is through taxes. Greg Valliere, a political economist, explains it this way:
“The stock market’s gains have virtually nothing to do with the size of the national debt, which continues to rise because government spending far exceeds government receipts.
A higher stock market encourages consumers and companies to spend more, which helps the overall economy. But it’s absurd to contend that the national debt has fallen because of this.”
We can measure the debt as a percentage of our gross domestic product, but even with economic gains reflected in the stock market, the trillions in dollars they’ve gained there do not equate to trillions of the national debt gone.
Furthermore, even if everything were sold and taxed now, the government wouldn’t reap trillions. One of George W. Bush’s economic policy advisers, Bruce Bartlett, says:
“With a tax rate on capital gains of 15 percent, even if all the stocks that have risen were sold tomorrow, the federal government would only reap at most 15 percent of the $5 trillion in asset gain.”
That’s less than the projected 2018 deficit, so it would barely scratch the surface. And, of course, Politifact rated this claim “False,” because DUH. It is absolutely insane that we have someone in the White House who wants to be seen as the greatest man who ever walked the planet without having a sense of how the planet works. Oh, please.
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