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February 6, 2018

Trump's Groundbreaking First Year?

Scott Stockdale

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Despite the relentless scathing attacks from his critics, President Trump has such a long list of achievements - as outlined in his recent State of the Union Address - that his first year in office may actually be remembered as one of the most successful - if not in history - then certainly in recent memory - for first-term presidents.

And this is a president with no previous political experience. That alone must say something about the need to have career politicians running the country.

On the all-important issue of the economy - which has a direct effect on everyone - it expanded 2.3 per cent last year, after experiencing a 1.5 per cent growth in 2016, 2.9 per cent in 2015 and 2.6 per cent in 2014.

Although respectable, but not spectacular, President Trump can cite a series of economic indicators that allow him to boast that American is great again.

The unemployment rate is down to a 17-year low of four per cent and the labour market has exceeded expectations by adding hundreds of thousands of new jobs: The economy added 2.1 million jobs in 2017, a bit slower than the 2.2 million in 2016 and 2.5 million in 2015.

But because unemployment is so low, economists say any number over 2 million is very healthy at this stage of the recovery. The gross domestic product is rising beyond expectations, consumer confidence is at a 17-year-high, small businesses are growing; and the stock market is soaring: The S & P 500 stock index surged more than 19 per cent in 2017 and is up more than five per cent this year.

Meanwhile, wages in January were 2.9 percent higher than a year ago; and although higher than gains made during the Obama years, nonpartisan experts are reminding us that one data point is not a trend.

However, the University of Michigan Consumer Sentiment Index is at a 17-year high, and the NFIB Small Business Optimism Index is at the highest levels since Ronald Regan was president.

His recent tax cuts – the biggest in over 30 years – along with cutting ten regulations for each new one added, has created a business climate whereby Business investment (dubbed “nonresidential fixed investment”) rose 4.7 percent last year, according to the Bureau of Economic Analysis, a big jump from the year before when business investment was flat.

While President Trump's tax policy has stimulated business investment, it will also cut taxes dramatically for a wide range of small businesses. It will double the child tax credit and put caps on the use of large deductions for mortgages and, state and local taxes for high-income taxpayers have helped create a fairer tax code.

President Trump touted the strong performance of 401 (k) accounts – retirement savings accounts - during his first State of the Union address. But most Americans don't have one.

"The great news for Americans – 401 (k) retirement pension and college savings accounts have gone through the roof," President Trump said in his 80-minute address.

But only about one-third of workers participate in a 401 (k) plan, according to 2017 research from the U.S. Census Bureau. In fact, just 14 per cent of all employers have a 401 (k) or other defined contribution plan for workers. Even companies where they are offered, only 41 per cent of employees contribute. The median balance – half are above – half are below – was $24,713.

Along with making good on his promise to vastly increase deportations of unlawful immigrants, President Trump has curtailed illegal immigration by making the southern border harder to cross illegally – arrests of people trying to cross illegally into the United States from Mexico are at the lowest point since 1971. Although he hasn't yet built his much-touted wall between Mexico and the U.S., illegal border crossings have plunged as much as 60 per cent since

President Trump took office. ICE director Thomas Homan recently said: "The president has done more for border security and public safety than any of the six previous presidents I've worked for."

This is in keeping with President Trump's vision for merit-based immigration.

Although the long-awaited demise of ISIS – it is almost completely defeated in Syria and Iraq – began during the Obama administration, President Obama used to say it would take 15 years to defeat it. Subsequently, decisive moves by the Trump administration helped hasten the defeat of ISIS in two ways.

President Trump equipped the anti-ISIS Syrian Democratic Forces -- a largely Kurdish militia -- with mortars, anti-tank weapons, armoured cars and machine guns. Those forces captured ISIS's de facto Syrian capital, Raqqa, in October.

He also allowed American ground commanders greater latitude to carry out operations in war zones such as Iraq and Syria, without consulting higher up the chain of command. Pentagon brass had long criticized what it considered to be the micromanagement of military operations by the Obama White House.

Unlike most developed countries, the US does not have a national health system, but at the same time Americans have the most expensive system in the world; thus, even a hospital trip can ruin many people financially. This is why health insurance is such a necessity.

Most Americans get insurance one of three ways: through government programs for the poor and elderly called Medicaid and Medicare, through their employer, or through the online marketplaces set up by President Obama’s Affordable Care Act in 2010.

The group using the marketplaces is dominated by small business owners and the self-employed. Marketplace plans are tightly regulated with a standard set of benefits, including maternity care, mental healthcare, and prescription drugs. President Trump changed that system in a couple of ways.

During his State of the Union Address, President Trump highlighted his administration's success in repealing the Affordable Care Act's individual mandate as part of its tax overhaul.

"We eliminated an especially cruel tax that fell mostly on Americans making less $50,000 a year, forcing them to pay tremendous penalties simply because they could not afford a government-ordered health plan," President Trump said. "We repealed the core of disastrous Obamacare. The individual mandate is now gone."

This means President Trump decided not to fund the subsidies the government gave insurance companies under Obamacare to make health insurance less expensive for low-income people. These are called “cost-sharing reductions”

He also signed an executive order to allow health insurers to sell loosely regulated, cheap plans outside the marketplaces. These are called “association health plans”, and are based on the idea that small businesses should band together to get better rates from insurance companies.

President Trump also stated that cutting prescription drug prices is one of the "greatest priorities" for his administration. In his State of the Union address, he cited progress already made and promised more to come.

"To speed access to breakthrough cures and affordable generic drugs, last year the FDA approved more new and generic drugs and medical devices than ever before in history."

Prescription drug costs have been rising in recent years, with medications dramatically increasing 44 per cent since 2003, and continuing to grow. President Trump proposed to prevent that from happening under his administration.

"One of my greatest priorities is to reduce the price of prescription drugs. In many other countries, these drugs cost far less than what we pay in the United States," President Trump stated.

"And it is very, very unfair," he said. "That is why I have directed my administration to make fixing the injustice of high drug prices one of our top priorities. Prices will come down."

Along with being the only developed country in the world with no national healthcare plan, the U.S. is the only developed country that doesn’t guarantee paid maternity or paternity leave to all. In his State of the Union Address, President Trump cited a policy that is gaining momentum in a Republican-dominated Congress, to provide new parents with paid time off. That policy is a budget-neutral approach to provide 12 weeks of paid leave by relying on early collection of Social Security benefits.

While we often hear that America has relinquished its role as a world leader under the Trump administration, President Trump has got NATO allies to contribute $12 billion more toward collective security. Decades of pleading by the Bush and Obama administrations failed to get NATO allies to meet their financial commitments to the alliance, but President Trump’s tough talk and reluctance to affirm America's Article V commitment pressured them into it. NATO can't help but be stronger as a result.

Although no president is ever going to silence his critics, the Trump administration has significant accomplishments to its credit in its first year in office, which may increasingly bring into question the necessity of electing a career politician to run the country.

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