President Trump listens during a meeting at the White House on June 25 in Washington. (Jabin Botsford/The Washington Post)
Columnist

We are passing a significant milestone. The current economic expansion has become the longest in U.S. history. Previously, the record was the decade from March 1991 to March 2001 (120 months). When the present recovery enters July, it will mark the 121st month of expansion. Just how much longer it will last is anyone’s guess, but, politically, this is the question that matters most.

Upon the answer may hang the identity of the next president. We are now at the point in the political cycle when swarms of Democratic challengers are field-testing their many policy proposals. All the candidates seek to project an image that will impress the voting public. Yet, the outcome may depend more on the state of the economy than the state of the debate.

If the economy remains strong for the next 16 months or so, President Trump’s reelection prospects will, it seems, be enormously enhanced. And, of course, the opposite is also true: If the economy slips into recession, even a mild one, Trump’s claim to extraordinary economic powers will be devalued. All the political maneuvering and posturing may pale beside the visible state of the economy.

So it’s Trump against the economy. If he can seem to control the economy (whatever the reality), he may overwhelm his opponent regardless of the case against him.

No one seems more aware of this than Trump, who has been building Plan B just in case Plan A (a continuous boom) fails. Plan B, of course, is to have the Federal Reserve take the blame if the economy falters. He has been attacking Jerome H. Powell, chairman of the Federal Reserve Board, for months, accusing him and the Fed of suffocating economic growth by raising short-term interest rates too soon and too much.

In 2017 and 2018, the Fed increased overnight rates seven times. They now stand at a range of 2.25 to 2.5 percent. If Trump is so vitriolic when the economy is basically strong, imagine what he would be like if a recession or a conspicuous slowdown occurred.

Will a strong economy propel Trump into a second term?

The job of predicting — always difficult — is especially hard now, because the economy seems to be sending contradictory messages. The stock market seems robust, apparently reflecting confidence in the economy’s underlying growth. On the other hand, bond markets seem to be telegraphing economic weakness, evident in low interest rates and a lackluster demand for credit.

The unemployment rate of 3.6 percent in May, the lowest monthly rate since the 1960s, also seems to indicate a widespread need for more workers — surely a sign of a healthy economy. But the absence of sizable wage and price increases suggests the opposite: The economy isn’t growing fast enough to generate pervasive scarcities of workers or products that would increase inflationary pressures. In May, the consumer price index, the government’s best-known inflation indicator, was up only 1.8 percent from a year earlier.

Then there’s the uncertain impact of Trump’s trade wars, which have affected not only exports but also business investments tied to trade. In 2018, foreign direct investment (FDI) by multinational firms fell 13 percent, reports the United Nations Conference on Trade and Development. It was the third consecutive annual decline. FDI covers factories, mergers and other forms of investment.

Understandably, attention is now focused on the first debates. But the decisive showdown may be between Trump and the economy.

Read more from Robert Samuelson’s archive.