17 Metrics to Watch in the Trump Era
Donald Trump ran for president on a swamp-draining platform of radical change. His success, he implied, won't be measured by conventional yardsticks. So what are the benchmarks? Here, Bloomberg View columnists offer metrics by which to judge the new president. Some are standard, others whimsical. We'll track them in the coming months.
Manufacturing jobs clearly matter a lot to Trump. He talked about them constantly on the campaign trail before the election; he’s been tweeting about them constantly since. So in the coming months and years, we should watch what happens with them -- and the metric to look at is the Bureau of Labor Statistics’ monthly count of payroll employment in the manufacturing sector.
The number has been on a long decline since 1979, even as manufacturing output has more or less held up. After a steep fall during the Great Recession, it did rise slowly for most of President Barack Obama's years. Then, last year, it began to slide again. Can Trump really do much to change that? We’ll see. JUSTIN FOX
Rust Belt Jobs
Trump's success or failure, both economically and as it pertains to his re-election prospects, will be judged by how the four key Midwest states he flipped -- Pennsylvania, Ohio, Michigan, and Wisconsin -- perform. Those four states have had essentially no net growth in their labor force since the year 2000.
Can the Trump administration make labor force growth great again in these states? It would mean a combination of people seeking work moving to those states, either from other states or abroad, and increasing the labor force participation of people already in the state, via either a stronger labor market or more incentives to work. If he can do it, he'll have delivered on his promise, but demographics suggest it's unlikely, and demographics rarely lie. CONOR SEN
On the campaign trail, Trump highlighted the need to look beyond the unemployment rate to understand the challenges that today’s workers are facing. Trump’s promise was broader than simply increasing the number of manufacturing jobs in the U.S. It was to make jobs plentiful for those left behind: working class men. His evidence? Labor force participation rates of prime age (25-54) men with a high-school degree or less have plummeted over the last 50 years. In 1964, 97 percent of such men were in the labor force; today, that number is roughly 83 percent. What are they doing instead of working? Playing video games, according to recent research. If Trump succeeds in fulfilling his promise, then more of these men should end up in jobs and the best metric to assess that will be the labor force participation rate of less-educated prime age men. BETSEY STEVENSON
Babies Named Donald (Seriously)
Forget all those other measures of Trump’s success. The one that counts will be found in an unlikely place: the names that new mothers give to their children. From the nation’s first days, parents named their children after presidents they admired, and steered clear of those who disappointed them. Thanks to the Social Security Administration, that data is now available in real time. If the name “Donald” abruptly reverses its decades-long decline -- it’s currently the 441st most popular name for boys -- that’s significant. But Trump fans beware: this particular metric can also register growing disapproval. The name “Herbert” became newly popular in 1928 when Hoover was elected, moving from the 42nd to the 25th most popular name. But after the stock market crash the following year, to say nothing of the Great Depression, “Herbert” swiftly sank like a stone, beginning a decline that continues to this day. STEPHEN MIHM
Curiosity About Canada
Google-search interest for Canadian immigration tends to increase when people are frustrated with the state of the country. During Obama’s presidency, the search popularity of “move to Canada” ranged between 1,000 and 10,000 queries a month. It averaged higher than under former Bush, but the financial crisis might have contributed to that fact.
The popularity of America’s favorite backup plan spiked after Trump became the presumptive nominee, and shot up by 2,000 percent the day after the election. Hopefully we won’t see a mass exodus to the north. If Trump can convince Americans not to give up on the country, that should be a pretty good sign. ELAINE OU
Early Exit Index
Ladbrokes, the British oddsmaker, is not bullish on Donald Trump. In November, the company began offering odds that Trump will resign or be impeached before his first term concludes. Odds started at 3-1, or 25 percent. Now they're even.
Betting markets don’t always foretell the future, but they're pretty good reflections of attitudes about the present. If the odds rise in Trump's favor, we'll know his administration is beginning to gain traction. If the odds of an early departure grow even worse, well, hold on to your red MAGA hat. FRANCIS WILKINSON
Right Track, Wrong Track
A traditional poll question -- "Is the nation headed in the right direction or off on the wrong track?" -- will be an instructive guide to Trump. The public will never much like him; he's not an appealing man. But many voters think he could produce results. This metric measures how people feel overall, about the economy, the social fiber, national security. In this month's Wall Street Journal/NBC poll, 52 percent of the public said the nation was on the wrong track, with 36 percent saying the opposite. If the right direction moves up to the mid-to-high 40s, that's good for the president. If it stays in the 30s, he's in trouble. ALBERT R. HUNT
Dow Plus Approval Rating
Here are two ways to evaluate Trump’s performance after his first six months: (1) the performance of the stock market and (2) his approval rating.
Though both measures enlist the wisdom of crowds, they are highly imperfect. The most important job of a president is to increase the nation’s well-being. That is a capacious concept, including liberty as well as economic factors (employment levels, poverty levels, per-capita gross domestic product). Because it is hard to specify a president’s contribution to social well-being, we have to rely on crude proxies, at least in the short term.
If the stock market is going up, investors are thinking that the Trump administration is not damaging the nation’s economic performance or introducing undue uncertainty. As of this writing, the Dow Jones Industrial Average is over 19,700. If it exceeds 21,000 in six months, that’s a strong signal; if it falls below 18,500, Trump’s economic plans are probably failing.
True, the stock market can do well even if many individuals are suffering (and even if an administration is plagued by scandal). You don’t have to accept strong claims about collective wisdom to agree that things are probably going well if Trump’s approval rating is above 55 percent and poorly if it is below 45 percent. (Also worth watching: What’s the difference between Republican and Democratic approval ratings?) And if the stock market is simultaneously having a big dip, well: watch out. CASS SUNSTEIN
Syria's Dying Children
An important number to watch during Trump's presidency is 15,948. That is, according to the Syrian Observatory for Human Rights, the number of children who have been killed in the Syrian Civil War as of Dec. 13, 2016. Compared to the estimated total death toll of 450,000, that's a relatively small number. It's the most heartbreaking one, though. It shames Syria's dictator and his Iranian and Russian enablers. It shames the Islamic State, al-Nusra and other jihadists, too. And it shames western leaders like Obama who failed to stop the slaughter. Now this will be Trump's problem. One way to measure Trump's leadership on the world stage will be to count how many more children die in Syria's foul war. ELI LAKE
Deficit as Percentage of GDP
Trump has promised huge tax cuts coupled with giant government spending programs for infrastructure and the military. That combination is normally a formula for exploding budget deficits, which constrain prosperity by reducing the funds available for companies and individuals to spend and invest. At the same time, Trump has also promised to unleash huge economic growth. If he does, the deficits might not materialize or matter.
Can he pull it off? A metric that tracks the relationship of deficits and growth is the U.S. budget deficit or surplus as a percentage of gross domestic product. It had its biggest annual improvement under Obama of any president over four decades before and after President Bill Clinton, who saw perennial deficits transformed into annual surpluses. Let's see if Trump can match that performance. MATTHEW A. WINKLER
The Trade Deficit
Trade deficits matter less than politicians and the public generally think, but it may nonetheless turn out to be an important number to watch. That's because Trump and several of his economic advisers have argued that the trade deficit is a large drag on the economy and have said that it should be brought down from $460 billion to zero. They are counting on this decline to boost the economy enough to generate the revenue to make their budgets add up.
Will the statistic cooperate? The dollar has been appreciating for much of the last year, which tends to expand the trade deficit by making U.S. imports cheaper for Americans and U.S. exports more expensive for foreigners. Some Trump policies, like deep tax cuts, are expected to strengthen the dollar further. Whether Trump can counteract these trade-deficit-widening trends by renegotiating trade deals and talking the dollar down remains to be seen.
The 1980s saw a new Republican president, tax cuts and a strengthening dollar. The results included decent economic growth and a widening trade deficit. The trade deficit in turn generated protectionist pressures during this period. The Republican president at the time, Ronald Reagan, mostly resisted those pressures. If he faces similar conditions, Trump seems likely to choose differently. RAMESH PONNURU
Tech Giants' Offshore Cash
Trump has made many absurd promises, but he's also promised to fix an absurd situation: U.S. companies, notably in the tech sector, prefer to keep their cash overseas because the U.S. has one of the highest corporate income taxes in the developed world. Trump hopes to bring the money back with a tailor-made tax cut.
Apple promised to bring home some or all of its cash -- $216 billion, the biggest stockpile in the industry -- back in September. But that was before Trump won the election and also after Apple's tax arrangement in Ireland so displeased the European Union that it asked the company to pay $14.5 billion in back taxes. Microsoft, Alphabet, Cisco, Oracle and Adobe, which together hold almost a third of all overseas cash salted away by U.S. companies, didn't have such a powerful incentive to repatriate their money. So they're Trump's clients. Can he lure them back? Their offshore cash is a metric to watch. LEONID BERSHIDSKY
Regs, Regs, Regs
Trump ran against global markets and creative destruction. He talks like a crony capitalist ready to dish out rewards and punishments from the White House. Except, that is, when he talks like a deregulator or appoints those who do. On his victory tour he pledged “to eliminate every single regulation that hurts our farms, our workers and our small businesses” — an extravagant promise indeed.
So which administration will we get, the meddlesome personal dealmaker or the burden-lifting business sympathizer? The metric I’ll be watching is the RegData index. Rather than measuring the sheer quantity of regulation, it tracks their content, flagging words like “shall” and “must” that create legal obligation. RegData offers a good measure how much regulation is expanding during a given administration. Combined with other indicators, it also allows scholars to drill down on the critical question: How much is political pull replacing value creation as the source of corporate profits? VIRGINIA POSTREL
Home Prices in Washington, D.C.
Whatever you think of the Obama administration, it’s been a good time for one group: Washington, D.C., homeowners, who have seen median home prices in the capital increase by roughly half.
That’s not necessarily due to Obama, mind you. Washington home prices have benefited from broad trends, including the growing appeal of city centers and falling crime. As far as government spending goes, the broader metro-area economy probably benefited more from the military buildup under President George W. Bush followed by Obama’s expansions, which often consisted of mailing checks elsewhere.
In general, a change of administration rarely affects Washington home prices much, which tells you how much control presidents usually have over them. But Trump is not a normal politician. His administration will bring in new people of a type who don’t usually live here. It may also chase away others in disgust. And we certainly cannot count on a “business-as-usual” continuation of previous policies to support existing prices. How they shake out should be fun to watch -- at least for those who don’t already own homes here. MEGAN McARDLE
Stephen K. Bannon stands to have enormous power as chief strategist in the Trump White House. He is also perhaps the most controversial member of senior leadership, having overseen a propagandistic media company with global political ambitions and a following among sexists and racists.
The news media will seek to expose Bannon, who keeps out of view, and his influence on domestic and foreign policy. If Trump's team is leaky and riven by factions, the White House will lose the war for message control and be unable to dominate the political environment. In that case, Bannon's name may well be all over the news. If all's quiet on the Bannon front, Trump -- and Bannon -- are firmly in control. FRANCIS WILKINSON
Real Median Income
In recent years, people have been paying more and more attention to real median household income. That is the amount of money that the average U.S. household makes in a year, adjusted for inflation. If Trump’s economic plans restore lost jobs or give wages a boost, we should expect to see real median household income go up. The same thing will happen if his infrastructure plan improves productivity. And if Trump somehow persuades more Americans to get married and live in multi-earner households, the income of the average household will also rise. Any of these changes would be welcome, since real median household income hasn't returned to the high reached in 2000. NOAH SMITH
Trump Headline Watch
On a given day, how many Bloomberg View columns have the word "Trump" or "Trump's" in the headline?
We live under a government of law, not a government of men (and women) -- or so I hope. If this remains the case, attention paid to Trump should fade over time. Right now, of course, he is something surprising and new, so we all want to read about him. If this trend shows no diminution, I say we are in trouble. If the Trump administration becomes some kind of normal administration, whether you agree with it or not, this variable should fall over time. I sit with bated breath. TYLER COWEN
This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
To contact the editor responsible for this story:
Mike Nizza at firstname.lastname@example.org