Can Trump Reach 3% Economic Growth?

In this video, I’ll explore whether the Trump administration stands a chance of reaching its goal of 3% economic growth.

On the campaign trail, President Trump said he would get the US to 5% annual economic growth. In office, his team lowered this to 3-4%.

The economy hasn’t growth at 3% in more than a decade. Its recent pace has been 2.1%.

Nonpartisan Congressional Budget office predicts a long-term growth average of about 2%.

Reasons: Slower growth of eligible workers, and a declining productivity rate.

Three years ago, The WSJ published a chart from John Burns Real Estate Consulting. It shows declining growth of the US labor pool.

Potential long-term growth rate is the sum of workforce growth and productivity growth. The workforce is projected by the CBO to expand at 0.5% annually over the next decade and productivity at 1.3%, for growth of 1.8%. That’s the “about 2%” I mentioned earlier.

In May, the WSJ published charts of the two trends, with data from the Labor Department: [chart shown in video]

Turning back to the CBO’s projection of the two components of economic growth, we see that Trump will need to focus on boosting productivity. This chart was also published by the WSJ in May: [chart shown in video]

Can Team Trump boost productivity? Probably not. Demographic trends point to lower human productivity in the decades ahead.

However, a trend completely independent of government policies could come to the rescue: automation.

Better robots and artificial intelligence are more productive than people. Factories are spending millions on upgrades to machines that can do the work of many human employees.

The problem is that even if higher productivity through bots increases economic growth, it will be pointless if people don’t benefit.

This is a tough nut to crack. Here’s hoping for higher growth in a way that helps people.


Want more videos like this? Subscribe to The Kelly Letter YouTube channel.

Thank you for watching!

This entry was posted in Video. Bookmark the permalink. Both comments and trackbacks are currently closed.
  • The Kelly Letter
    A Complete Investment Management System
    The Kelly Letter  every Sunday morning by email.
    Like no other. Many subscribers say this is the best read of their week, astonishing in its ability to distill seven days of noise into one succinct overview of the very few items that might matter. Start your Sundays right!
    A one-page Quick Start Guide
    with page number references to full information in The 3% Signal. You'll receive access to this right away so you can begin transforming your portfolio into a performance machine immediately.
    The 3Sig Calculator.
    A thing of beauty! You'll use it to generate your own personal signals every quarter including exact share amounts to buy and sell based on your account balances. It emails you the results to make later quarters easy by keeping last quarter's numbers at your fingertips. Some subscribers say this tool alone justifies their subscription price.
    The subscriber-only section of this website
    where likeminded investors are commenting on notes and discussing in forums. Jason joins these interactions every day. They're a treasure trove of investing tips and wisdom.
    The archive of Kelly Letter notes.
    It’s a research center, searchable and smartly tagged to make gathering time-stamped material on covered subjects easy.
    The subscriber podcast.
    Jason reads every letter word-for-word. This feature was requested by subscribers who prefer audio learning. They listen on their Monday morning commute, during a workout, or while reading along at their computer.



    $200/year
    Save 17%



    $20/month
    Pay as you go
    Or sign up to receive free email and learn more about the system.
Bestselling Financial Author