NEW YORK ( TheStreet) -- Grab your pizza and popcorn, folks -- it's U.S. presidential debate season!
Every four years, we're treated to the spectacle of two men jockeying for power in the world's most powerful nation -- and predictably, this involves ample fact-stretching and twisting. At
, we're politically agnostic: We prefer neither party over the other, finding much to dislike (and occasionally something to cheer) in both parties' policies and proposals.
Either party is capable of implementing market-friendly reforms, and both have borne responsibility for some rather disruptive regulation throughout history. And during the first debate, both candidates proved adept at painting a rather fuzzy economic picture. Here, Fisher Investments reviews each candidate's portrayal of the U.S. economy.
We start with the challenger: former Massachusetts governor, Republican Mitt Romney.
Statement: Romney described this year's economic growth as "slower than last year, and last year slower than the year before."
Looking purely at percentage-based growth rates, this is true. Real U.S. GDP grew 2.4% in 2010 and 1.8% in 2011, and 2012's first half was slower than 2011's. But much of that slowness comes from higher imports -- a sign of healthy domestic demand -- and falling government investment.
Strip those components out, and the picture looks different. Total household spending and private investment rose $352.6 billion in 2011, higher than 2010's $330 billion increase (measured in 2005 dollars). The GDP components that better reflect the economy's health are more resilient than Romney's general statement would suggest.
Statement: "I'm not going to keep spending money on things to borrow money from China to pay for."
He won't necessarily have to -- China doesn't own a huge share of our debt. In fact, our biggest creditor is, well, ourselves: 66.6% of net public debt is owned either by the federal government or domestic investors. China owns a whopping 7.4%.
data, U.S. households have purchased significantly more Treasuries than foreigners in recent quarters, and China's purchases have lagged other nations'. One can't exactly say China is financing the U.S. government.
Statement: "Spain spends 42% of their total economy on government. We're now spending 42% of our economy on government. I don't want to be Spain."
Good, because we're not Spain. Not even close.
First, consider Spain's situation isn't all about debt. In fact, Spain's federal debt-to-GDP ratio wasn't high by global standards in 2010, when peripheral debt fears first took hold. Spain's situation is as much or more about economic competitiveness than about debt.