As expected, Donald Trump used his unscheduled statement from the White House to take a victory lap or two, and not just on the economy. Trump spoke for a little over fifteen minutes, focusing mainly on the big Q2 GDP boost, but also highlighting significant progress on the trade deficit:
Trump announces that in second quarter report, U.S. trade deficit dropped by more than $50 billion pic.twitter.com/jWcSOth1Tc
— POLITICO (@politico) July 27, 2018
There’s a story behind that big drop, of course, which is that the imposition of tariffs incentivized international purchasers to accelerate their imports from the US. Both exports and imports grew in Q2, but exports grew by 9.3% while imports only grew by 0.5%. The demand shift is responsible for a significant part of that trade-deficit drop, which might end up snapping back in Q3. The White House clearly wants to argue that trade deals will open up exports even more, eliminating that outcome, and they may well be right — but it’s still a gamble in the short run.
Trump wasn’t afraid to double down on it:
“We’re on track to hit the highest annual average growth rate in over 13 years and I will say this right now, and I’ll say it strongly, as the trade deals come in one by one, we’re going to go a lot higher than these numbers and these are great numbers,” Trump said.
We’ll see. Trump also hailed the impact of tax cuts on Q2, noting the investment by companies able to repatriate overseas profit. “We’ve added 400,000 manufacturing jobs since I became president,” Trump said, noting that people scoffed that manufacturing jobs could grow in the US. Manufacturing jobs are returning to America, Trump declared, using Apple as one example of the domestic expansion in high-tech industries linked to the tax reform passed last December.
At the end, Trump abruptly changed topics to announce that North Korea had just transferred the remains of hundreds of US soldiers to American custody. Trump will send Vice President Mike Pence to meet the plane and the families who will gather there, and thanked Kim Jong-un for fulfilling his promise:
Pres. Trump: "At this moment a plane is carrying the remains of some great fallen heroes from America back from the Korean War."
— ABC News (@ABC) July 27, 2018
Interestingly, Trump took care to not take a victory lap on this development. Perhaps that’s out of respect for the families involved and the tenor of this particular moment. It might also be more caution on talking up progress in the Korean Peninsula negotiations, given the rocky nature of recent developments. Better not to get too far out in front of one’s skis on that issue, while offering Kim a polite response to coming through on an important pledge.
Here are Trump’s full remarks, as covered by Fox News on their livestream.