As Trump Unmuzzles the Economy, Rosy Scenario Will Become Economic Reality
President Obama’s first budget forecast roughly eight years ago was much rosier than Trump’s. And there was nary a peep of criticism from the mainstream-media outlets and the consensus of economists.
.. the Obama policy didn’t include a single economic-growth incentive. Not one. Instead, there was a massive $850 billion so-called spending stimulus (Whatever became of those spending multipliers?), a bunch of public-works programs that never got off the ground, and finally Obamacare, which really was one giant tax increase.
.. So eight years ago tax-and-spend was perfectly okay. And the projection that it would produce a 4 percent growth rate perfectly satisfied the economic consensus.
.. So here’s President Trump reaching back through history for a common-sense growth policy that worked in the 1960s, when JFK slashed marginal tax rates on individuals and corporations, and again in the 1980s, when Ronald Reagan slashed tax rates across-the-board and sparked a two-decade boom of roughly 4 percent real annual growth. But the economic consensus won’t buy Trump’s plan.
.. Most of the Trump critics point to the decline in productivity over the past 15 years. They say, unless productivity jumps to 2.5 percent or so, and unless labor-force participation rises, we can’t possibly have 3 to 4 percent growth.
.. “Take off the muzzle and the economy will roar.”