Monday, December 8, 2014
Common knowledge, uncommonly wrong
Within 24 hours of taking office on December 1, 2012, incoming President Enrique Peña Nieto became the beneficiary of the Pact for Mexico, in which the three major parties pledged cooperation in implementing reforms aimed primarily at economic advancement.
Within 24 hours of taking office in January of 2009, incoming President Barack Obama was the target of a pledge by opposition leaders to block any reform the new president might try to implement, which, given the sack of manure he was handed from his predecessor, would be aimed primarily at economic advancement.
Since then, as everybody knows so well, Peña Nieto has been busy Saving Mexico, ushering in the Mexican Moment, taking giant steps toward a thriving market economy and turning his country into the darling of investors worldwide.
Obama, meanwhile, has bumbled his way through seven years of suppressed growth, single-handedly discouraging job creation as he balloons deficits.
What’s wrong with this picture? Just the truth of it. To wit:
Peña Nieto inherited an annual growth rate of 4.03% from the last year of the Calderón administration. It promptly plummeted to 1.44% in his first year and may barely crack the 2.0% barrier when the 2014 numbers come in.
U.S. GDP growth, on the other hand, was more than 5.0% below 0 when Obama took office, resulting in negative growth for 2009. But since then the annual numbers have all been positive, and after a bad weather-induced first quarter in 2014, the last two quarterly growth rates have reached 4.6% and 3.9%.
Mexico’s public finances deficit, promised to be reduced to zero, has instead risen as a percentage of GDP since 2012 and shot up 119% in the first three quarters of 2014 over the same period in 2013.
Whereas the U.S. deficit during Obama’s nearly six years in office has been reduced from 9.8% of GDP to 2.8%.
The U.S. and Mexican unemployment rate figures differ sharply in methodology and reliability. Still, Peña Nieto inherited a 2012 rate of a few ticks under 5.0% and kept it right about there in 2013. The 2014 forecast is for something similar, perhaps a few ticks lower.
Under Obama, a different story. The U.S. unemployment rate has dropped from 7.8% to 5.8% — slowly, to be sure, but in the right direction.
Inflation has been a pesky problem during Peña Nieto’s term so far, with the annual rate rising from 3.0% to 4.2%. Some items in the “basic basket” of food items have increased in price by 20%.
Under Obama, inflation has been close to nil.
So . . . growth slowed under Peña Nieto, up under Obama. Deficits down under Obama, up with Peña Nieto. Unemployment level under Peña Nieto, down under Obama. Inflation up under Peña Nieto, not a factor under Obama.
The point here isn’t to promote one president as better than the other (although one clearly is). It’s to promote facts over perceptions.