There have been 11 recessions and 11 recoveries since 1949.
The current recovery is the slowest recovery since 1949 and closing in on the becoming longest.
Growth since the 2nd quarter of 2009 is a mere 2.1%. The Wall Street Journal asks Is Two Percent as Good as It Gets?
“The growth seen during the recovery might, for a while, be as good as it gets,” the Federal Reserve Bank of San Francisco’s John Fernald, Stanford University’s Robert Hall, Harvard University’s James Stock, and Princeton University’s Mark Watson said in a study to be presented among Brookings Papers on Economic Activity.
Inquiring minds may wish to download the Brookings’ report entitled Disappointing Recovery of Output After 2009 but I found it a waste of time.
Okun’s Law
The report was mostly mathematical gibberish based on Okun’s Law.
Okun’s law (named after Arthur Melvin Okun, who proposed the relationship in 1962) is an empirically observed relationship between unemployment and losses in a country’s production. The “gap version” states that for every 1% increase in the unemployment rate, a country’s GDP will be roughly an additional 2% lower than its potential GDP. The “difference version” describes the relationship between quarterly changes in unemployment and quarterly changes in real GDP. The stability and usefulness of the law has been disputed.
Clearly, Okun’s Law is at least as useless as any widely believed economic law, which is to say totally useless.
The supporting paper consists of 90 pages of largely unintelligible garbage such as the following.
Commendable Effort
The Wall Street Journal managed to condense 90 pages of nonsense down to 2 pages of nonsense. That’s a highly commendable effort, and the best one could reasonably expect.
Here’s the conclusion: “The causes aren’t entirely clear.”
I searched the 90-page report for the word “debt“. Care to guess the number of hits? I bet you can: zero.
Modern Day Snake Oil
I was discussing economic indicators with Pater Tenebrarum at the Acting Man Blog a couple of days ago. He pinged me with the correct takeaway.
Economic forecasting is not a science, and it is actually not the task of economic science to make forecasts (contrary to what is commonly asserted). Forecasting is akin to the task of the historian. Mises called speculators “historians of the future”.
Economic laws only play a role insofar as they can be used as constraints for a forecast. The problem is that all these models simply look at the data of economic history, at statistical series that always turn tail “unexpectedly”, driven by human action.
All these mathematical models are complete humbug. It is modern-day snake oil.
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Mike “Mish” Shedlock
2.1%? We wish!…Try using a realistic deflator and excluding increases in government salaries and benefits (which are included in GDP). The result will be very very grim….
GDP, after consideration of true inflation (at least 5-7% annually since 2008) has been consistently NEGATIVE!!!!!!
does that number include massive shrinkflation/?Soaring chinese crapification?soaring gov’t spending/taxing/fee increases to nowhere?Does that include soaring costs of wars in virtually every clime n place,add it up and we are at record levels of “stealthflation”
The GDP Deflation has long been more accurate as a measure of inflation that the CPI, which traditionally overstated it. If your statement was true, then our GPD has been falling for 50 years, in which case our standard of living should be comparable to the 40’s, which it demonstrably is not. When reality conflicts with one’s pet economic theory, how does one resolve the cognitive dissonance? Ignore reality, I guess.
Depending entirely on which arbitrary measure you choose to use for “standard of living,” that “demonstrability” may be a lot more tenuous than you likely assume. At least if you move a bit further away from outright war rationing etc. of the 40s, into the mid 50s.
Once past the late 60s, there has been virtually no per capita increase in the very fundamental, and harder than most to fudge for political ends, metric of energy consumption per capita. While since then, wealth concentration has certainly concentrated the living standard contributing benefits of many of those Joules, to greater degree than before.
As an example: For an average soldier returning from Iraq who values children and a house with a yard in San Francisco higher than he values an Ipad, it’s hardly unfathomable that his living standard is in fact lower than that of his colleagues returning from WW2.
Had a conversation with my father on this topic recently. He was a teenager in the 1950s. In his now aged opinion, the only real improvement to the standard of living he enjoyed in the 1950s is televisions and television shows, and the ability to look up information on the Internet.
As you mention above, he felt in many ways the standard of living has declined, to include real estate prices, crappier and harder to get jobs, and, importantly to him, too many fishermen and not enough fish.
Obviously healthcare is much more expensive each year, but that also reflects many advances. For example, cancer treatment has dramatically improved, MRI’s improve treatment of soft tissue injuries, joint replacements are commonplace, etc. How about the fact that cars routinely start these days – back in the fifties, when you turned the key, you were never sure what would happen. There are many advances we don’t think about, but they are there, nonetheless.
I bet if you offered to trade someone their new car for a similar new 50s car, while at the same time trading them the house they can currently afford in San Francisco for the one they could afford in the 50s, you’d have quite a few takers……..
And ditto goes for their kids scooling, their ability to support a larger family on one income, reasonable retirement security, de facto ability to afford to move and find work wherever they wanted to live in the country etc.
Technology has obviously improved many things, but it’s not far wrong to say that whatever technology has brought, financialization and goverenmentization has largely taken away.
yeah ,that’s why more than half the population depend on gov’t handouts in some shape of form,gov’t welfare gov’t entitlements because of “cognitive dissonance”lol
We need a non nuclear world war to rev up our economy if that is possible. Take our mind off of our troubles. Bring back the draft, give our unemployed Millennials something to do. Be sure to draft our women too in the drive for equality for all. Allow illegal immigrants to get citizenship by serving in the military. We can fix multiple problems at once.
I think we should add plague to war on the list of ways to fix the global economy.
A plague would work wonders, e.g. a pandemic flu that kills off 50% of the global population. The black death was wonderful for the lower classes in medieval Europe, once you got past the whole “everyone you know is dead” thing.
Another option would be to cook and eat the children of poor people. It was suggested as an economic cure the problems of 1729 Ireland, but unfortunately the idea was not implemented.
Better idea today. Poor kids are sedentary and fatter now. Think baby veal.
Neither war nor plague is a good idea: both kill arbitrarily and are difficult to control. You need to go back to the drawing board.
You didn’t comment on eating the children of the poor.
All we “need” to dom, is get rid of the government. Or, at least, 95% of all it is, all it does, and all it meddles in. It’s not like people are somehow no longer able to improve their lot day by day, which is all economic growth is, if they were simply able to do so without intervention. And without having what they already have, confiscated by an ever more rapacious band of leeches lording over them.
Excellent chart. Looks like we’ve been pulling forward demand for quite some time, piling up some rather large piles of debt in the process. If it isn’t working, the obvious solution is that we must need more of it. LOL!
I’m not sure the figure of 2% GDP to 1% unemployment is right but the ‘law’ seems pretty sensible. GDP is goods and services produced in a year. Goods and services are produced by workers and capital combined with productivity (‘know how’, ‘innovation’ or whatnot). All else being equal if you have fewer people working, you’re going to have less GDP.
But couldn’t capital and productivity make up? Sure but it’s hard in the short run. A while ago Mish predicted as soon as self-driving long haul trucks were perfected, millions of truck drivers would be out of work. But he is wrong. In the short run there’s only 1.6M truck drivers. Existing trucks would cost money to retrofit to ‘self-driving’ types, new trucks might be made to be self-driving but old trucks are decommissioned at a gradual pace. Only if self-driving trucks are super-cheap will you see a rapid effort to suddenly turnover the capital stock, increase GDP while decreasing workers.
And Obama added more to the debt than ALL other administrations combined and accounting for inflation…..
With bailout after bailout and ZIRP…
And all we got was a sub 2% tee shirt.
All future demand has been pulled in.
The abyss stares back at us.
Future demand pulled in? That makes absolutely zero sense as a concept. Say I would have brought a car in 2020 but instead I brought a new car in 2015 because of spooky ‘debt’. So now it is 2020 and I’m not buying a new car because the car I have is still ok (granted it’s 5 years old). Did the magic of debt somehow, via a time machine, pull my demand into the past?
Errr no, because at this point my car loan has been paid off. Someone on the other side of that loan has collected enough money for a new car plus interest. That is now his demand. Nothing can be ‘pulled forward’ in time.
“Nothing can be ‘pulled forward’ in time.” — What about asset bubbles fueled by leverage, like the ones which caused the crashes in ’29, ’01, and ’08? It seems that demand was pulled forward as price momentum was built upward in part due to buyers using increased borrowing, causing the herd to follow. I.e. If we didn’t have NINJA loans and the like, would people be so anxious to “get in the market”, and would these bubbles so easily occur?
Asset bubbles are not about demand being pulled forward. There was some excess home building in the 00’s but most of the bubble was driven by the price of existing houses going higher and higher. Remember, GDP is the production of goods and services. If your 3 bedroom ranch was worth $250K and now it’s $450K, then it feels really good to be you but that does absolutely nothing to GDP directly.
In your example the demand created by the loan proceeds are ALSO pulled forward. Doesn’t that mean that instead of zero pull forward effect you get a double impact – one when the car purchase comes five years early and a second as the car payments also create early demand.
Could be I’m missing something tho.
You are erroneously assuming what’s referred to as a fully reserved banking system. Fractional reserving allows me to borrow X dollars from you to spend today, without you simultaneously having to curtail your own spending by X dollars.
If I borrow $100 from you, and you are organized as a bank, all you have to do, is set aside $10 of your own money in reserve, and print up the rest. So now, the two of us can spend $190. Despite me starting out broke, you with only $100.
But conversely, as I pay back the $100, $90 of them simply get zeroed out, so that since you already spent your other $90, all you now have left is $10.
Hence, instead of you being in a position to demand $100 at the onset, and me $100 at the end (the money I necessarily must have made in order to pay you back), for a total demand of $100 both in 2015 and 2020; the debt exercise made total demand $190 in 2015, but only $10 in 2020.
Hence “pulled forward.”
Now, if I could not have made the $100 I used to to pay you back, absent your initial $100 loan (to buy a machine I could make money with, say), things are less cut and dried. Which is why debt used for productive purposes is often referred to as “self cancelling.” As opposed to consumer debt, which when burned on a flashy car, generate no net new demand, but instead simply pulls existing demand forward in time.
Also, as long as you can keep lending out 10 to 1 all the funds I pay you back, total demand won’t shrink. Which is why fractional reserve pyramids can remain stable as long as total systemic debt can be pumped higher and higher. But once this fails, the whole cardhouse comes crashing down, as it always have done, and always must do, in the end.
I think you are forgetting…. as I pay back $100 I am at the same time withdrawing demand from the economy.
Map it out.
I want to buy something so I borrow $100. I swipe my credit card. The bank issues $100 to the merchant, notes that I now owe it $100. It only has $10 in it’s vault but that’s ok because the required reserve rate is 10%.
Next week I get paid. My employer’s bank account drops by $100 and mine increases by $100. Instead of buying stuff, though, I pay off my credit card.
For me as an individual, ‘demand’ has pulled through. Without the credit card I would have waited a week to buy that $100 thing but the credit card let me do it a week early. But on the flip side when my pay finally came the $100 I would have spent is now being used to pay off my loan.
But you forgot the bank. The bank only has $10 so it is only allowed to make loans of $100. Before I swiped my card, the bank was able to do that but by me swiping my card, I filled up that amount of loaning power the little bank had.
Likewise a week later by paying off my loan I now free the bank up to loan $100 to someone else. My ‘pulled forward demand’ is offset by the bank’s ‘pushed backward demand’.
So what you are saying is that by you borrowing, you pulled demand forward. But also that, if someone else did the borrowing instead of you, demand would also have been pulled forward.
One way or the other though, increased systemic debt in world of fractional reserves, increases current demand over what it otherwise could have been. And the only way for nominal demand not to drop at a later date, is for total debt to not decrease later. As in, either not be repaid, or be lent back out as soon as it is repaid. If at any time systemic debt shrinks, nominal demand shrinks right alongside it.
Hence, any time systemic debt increases, you are pulling forward demand that would otherwise not have been there. And anytime systemic debt decreases, demand decreases right along with it. The only way around that, is base money infusion.
“So what you are saying is that by you borrowing, you pulled demand forward. But also that, if someone else did the borrowing instead of you, demand would also have been pulled forward.”
No, by me borrowing from the bank I have prevented the bank from making a loan it could have made to someone else. The same thing happens if I borrow from my best friend. By loaning to me he is unable to buy something today. It also happens if you require 100% reserves. My borrowing today to spend short circuits someone or something else’s spending today. If I had opted not to borrow, to wait, someone or something else would not be constrained today.
Your ‘pull demand forward’ story fails because we live in 3 dimensions but the economy can only occupy the present moment. You can move demand from one area to another (if I borrow money from my buddy who lives in another state, demand in my state increases and decreases in his state) but you cannot move it around in time. If debt makes me ‘pull forward’ demand from the future it is only because in the future my ‘shortage’ of demand will be someone else’s surplus.
Consider what happens if I flake out and stiff my loan? My buddy who would have gotten $100 in the future now does not have that money. His demand is lower, but my demand is higher as I am not paying my debts. Or the bank is unable to make a new loan because it now has a bad loan to write of whereas previously it had expected to be receiving my payment and lining up a new loan.
What happens if I unexpectedly pay my loan off early? In the present moment I have less because I opted to pay down a debt early rather than spend it on something else. My buddy unexpectedly gets money sooner than he planned. Or the bank unexpectedly has an open ‘slot’ for a new loan.
You can’t pull demand from the future unless you have a time machine, go back in time to buy stuff and then bring it with you to your present.
All you’re stil repeating over and over is that as long as the bank lends to someone, demand today is indeed pulled forward. Claiming that if the bank didn’t lend to you, it would lend to someone else, doesn’t really refute that the act of lending creates demand today that would otherwise not be there. Absent any lending, there is $100 available globally to demand with. After the act of lending, in a 10% reserve world, there is $190. In a full reserve world, that could not happen. No amount of “if this, otherwise” etc., etc. changes that. And that makes a very big difference
I don’t know about that. Truck drivers currently cannot drive more than 11 hours (or 14 hours on duty, but only 11 hours driving) before they must take 10 hours off duty. The tech may be expensive, but it wouldn’t have that same limitation. Also, it wouldn’t be surprising if the tech works well that legislation might be passed effectively eliminating speed limits for trucks. Their individual traffic situation could determine what speed is safe/appropriate. Long stretches of interstate highway could become autobahn at certain times.
“Also, it wouldn’t be surprising if the tech works well that legislation might be passed effectively eliminating speed limits for trucks.”
This is one example, why you shouldn’t believe everything you read on the internet, but try to think for yourself. Obviously you don´t know anything about heavy trucks or transportation.
Don’t get me wrong, I’m not saying truck driving is a career that I wouldn’t bet on staying around in the long term. But there’s a good chance a 45 year old driver today will still be driving when he’s 55, even 60. Even if the tech is amazingly good and amazingly cheap it is unlikely to suddenly alter all the truck capital in the US in a matter of a few years.
Long after DVD players were introduced, you could still rent VHS movies from rental stores and it’s a lot cheaper and easier to change the box next to your TV than it is to change all the highway trucks in the US.
boonton,
you wouldn’t believe all the specialized roles that a heavy truck would fulfill in a modern society. Plowing, Salting, Trash recycling, Craning (building materials), concrete, asphalt, gravel, flush and wash, sewage and pipe, hydraulics, timber, specialized and dangerous goods etc etc, and yeah,,, of course packages with barby dolls etc. inside (and the other .com orders).
Go on, morons.
Automate it. This is not by any means the exhaustive list. It´s like saying a modern John Deere would eliminate all farmers.
Again I agree, however over the long run I wouldn’t say it’s likely to be a growing profession. If long haul drivers are phased out over a few decades, then that’s so many more CDL licenses for the other jobs you described. Some of those jobs might be even easier to automate than long haul driving. For example, in waste and recycling I suspect you might have an easier time automating roll-off work (dumpsters and containers). Even trash pickup could be partially automated with a driver eliminated and lower paid staff to help with garbage can dumping.
“Economic laws only play a role insofar as they can be used as constraints for a forecast. The problem is that all these models simply look at the data of economic history, at statistical series that always turn tail “unexpectedly”, driven by human action.”
This is what most economists base their advice on, how to save for your pension, etc. blah blah. I think the best way to save is by paying off debt, and not taking up too much debt in the first place.
The demographic headwinds facing the US economy are MASSIVE….coupled with gains in productivity (i.e., less carbon-based working stiffs — a/k/a slaves) via technology (e.g. IT, AI, robotics…etc)…and GOOD LUCK with that. Boom! Next! No soup for you!
I think you are a joke.
The massive amount of both public & private debt will insure 2% is as good as it gets.
Concise and accurate.
kudos
…
and before someone mentions “inflating debt away” … better chance of finding Bigfoot / Loch Ness first. To inflate away that much debt will likely mean losing control of currency. MASSIVE amount of debt needs to be wiped out via default / cram down before more than meager growth sustained.
US (and rest of developed world) drafting on Japan
https://youtu.be/C9_xBYl9lJw
It seems that most of the economic reporting was FAKE NEWS to keep the party going. If we didn’t see all those stock buybacks, zero interest rates that allowed for financing buybacks and recomputing the GDP over and over again to make it look better, then we never would have had this massive market move. When companies started announcing their earnings using NON-GAAP accounting, that was the first volley that they need to LIE in order to show earnings growth. No mark to market accounting padded the gains further. The whole system is a scam and when it blows, the little guy will be wiped out.
So, your saying deregulating the financial system was not a smart move?
Creating the financial system was not a smart move.
… as we await even just one single prosecution of any old CEO under Sarbanes-Oxley. Evidently, everything is on the up-and-up, so…. we’re all good!
sarc / off
GDP growth and general standard of living improvements have so little in common, what do goal seeked statistics have to do with reality anyway?
And yes, the foxes will eventually goose the stats to double digits and beyond, but the prols will be no better off for it. In fact, there likely won’t even be bread on the shelves when we eventually reach peak “GDP” growth. And ya can’t eat mathematical equations, so,,,
Best to work on ways to be as self sufficient as possible for when the foxes abscond with the seed corn and head for their bunkers, which is really where this ends.
In 2008 when the crisis struck the big losers holding toxic stuff gathered riound the politicians and told them they simply could not accept the losses, somebody else had to bear them, that is, the citizenry, the taxpayer.
It has been downhill ever since, with central bankers conjuring up a new economic theory almost every month to justify their actions.
The hoi poilloi sense there is something badly awry but it will not change until those creating the mess are disowned, discredited and kicked out.
It needs a “Banker Trump” to go for the banking system like Trump has gone for US politics.
GDP is a ridiculous measurement. It was designed for an industrial economy where capitalists use capital and labor to produce goods for sale. We outsourced that a long time ago. I propose we move to GFS: Gross Financial Scams. The measurement would be annual growth in the DOW + growth in total value of corporate bonds + growth in real estate prices. Compare this growth to past recoveries and I bet we’re doing great. I’ve found this measurement highly correlates to the happiness index of the financial community. And isn’t that what really matters?
The NBER, National Bureau of Economic Reseach, uses the big four. It is the easiest accessible alternative to GDP.
+1.
🙂
Here is Doug Short’s composite of the big four, non-farm employment, industrial production, real retail sales, real personal income minus transfer payments. I think the NBER actually uses wholesale sales instead of retail but this is Doug’s version.
This shows the output gap.
http://bit.ly/2nsVuNo
The Wall Street Journal is late to the game.
Morons. The emigrated sons of Europe, morons.
Even though I have family there.
The most interesting thing in this article is seeing the trend. Each cycle, the recovery rate is less. In the 50s you saw recovery rates of 7% a year, and now we are lucky to see 2%. Why? Perhaps in part it is because the economy is larger today. I suspect another part is that as government grows, it significantly hinders the ability of the economy to recover. Another part is also the ever increasing burdens of regulation.
Great observation.
Another way to describe this trend? diminishing returns (on exponentially leveraged debt).
It’s a trap. We are in an economic trap, the resolution of which is ignored by TPTB/serfs in the hope that they/we will all be dead before the trap snaps shut.
yep … for 2015 total debt all sectors grew about $2 trillion … while GDP only about $500 billion.
“yep … for 2015 total debt all sectors grew about $2 trillion … while GDP only about $500 billion.”
Something about this feels off when you consider GDP is only goods and services produced in an economy in a year.
Say debt and GDP grow by $500B. You’d be inclined to say people borrowed $500B and spent it on stuff, other people who happened to have $500B decided to forgo the party and instead lend it to the people who wanted to borrow.
But if debt grew $2T but GDP only grew $500B that implies almost all of the debt is paper on paper. I borrow $200, spend $50 and put $150 in my savings account. Am I bankrupt? Hardly, if all else fails I can use the savings account to almost pay back all that I owe. How could debt be a drag on GDP in that case? Next year I’d rather not let my spending grow by 3% or more? Why? Because I owe an earth shattering $200? But I could at any time wipe out 2/3 of my debt by just cancelling my asset. If anything I should feel very safe increasing my spending. I have ample liquidity I can call upon at any time for safety.
Who borrows to put $$s in savings account?
Borrowed funds are spent – in the case of consumers likely on consumption (or to pay off other debt obligations) rather than productive assets. And when the worm turns – and it will – the credit spigot tightens. Then deep doo doo for borrowers … and economy.
Debt grows by $2trill, GDP by $500bil, when people borrow $2trill to spend at Walmart, Who then turns around to spend $500bil on salaries and dividents, while paying the remaining $1.5tril for imports from China.
There are other ways to make the numbers come out, but that is one of them.
“Who borrows to put $$s in savings account?”
People borrow all the time to buy assets. If you buy a house, for example, none of that money is part of GDP (except for the fees charged by real estate brokers, lawyers, title companies etc.), unless you are buying a brand new house built that year.
Borrowing $2T to go to Walmart and $500B going to salaries and $1.5T going to China doesn’t really fly as I doubt you’ll find $1.5T of imports since 2015.
A few good theories I’ve seen:
1. The electronic technology age simply isn’t as valuable as previous technology ages on GDP growth like the internal combustion engine, harnessing electricity, indoor plumbing etc… Therefore there just isn’t the level of job growth enjoyed in earlier decades.
2. Globalization has offset traditional growth patterns. Productivity growth has made people more productive, but offshoring manufacturing hasn’t allowed for the traditional creation of new, high-paying jobs. So jobs and income get reduced in high-tech countries (USA) but gained in low-cost countries (China).
3. GDP growth requires income growth. Income growth requires productivity growth. Non-manufacturing industries do not have as much potential for productivity growth. And USA is increasingly non-manufacturing. Interestingly, why are non-manufacturing industries inclined to less productivity growth? Because they generally have lower labor costs. Lower labor costs reduce the need for capital investments which reduce the potential productivity and income growth. Why the lower labor costs? Lack of trade unions and employee bargaining power.
4. Private Equity. PE firms attempt to convert private companies income into debt for the PE firm. Because debt is a steady, required payment, firms have less flexibility to take losses on potential innovation. Less innovation = less capital investment = less productivity growth = less income.
Maybe some combination of all of the above. Notice I only mentioned debt in number 4 and didn’t mention government at all. Though government today is purely a subsidiary of Wall Street.
“Maybe some combination of all of the above.” — Probably. Maybe there would have been less off-shoring of MFG jobs if our business tax rates in the US had been more comparable to those of low cost countries.
Off-shoring manufacturing doesn’t reduce your corporate taxes for US companies. If the company itself moves to a foreign country, that helps.
However, differentials in regulatory burdens over how employees have to be treated, how the environment has to be treated and things like that can certainly cause differences in productivity, or at least who has to bear the brunt of the costs.
Re #1. Suppose Facebook had been able to get a patent on ‘social networking site’. LinkedIn, Twitter, even the old Myspace wouldn’t be allowed to operate without paying a license fee to Facebook.
As a result Facebook charges users $100 a year and many, not all but many, pay it. Facebook’s revenue would be much higher as would it’s contribution to GDP. But it isn’t clear that Facebook would employ many more people.
Yet in our universe Facebook doesn’t charge because if they did anyone else could create a free version. Hence GDP does not increase as much but does this make it less valuable?
Bank central planning of the economy is inefficient.
Debt is already a constraint to growth, and increasing the debt ceiling will just lower growth prospect further. We also know that higher taxes (shifting more resources from the private sector into the soviet socialist sector) will also lower growth.
There is no way the US government can keep its size and scope. At its current size, the government is suffocating its own tax base. When a cancerous growth gets to be bigger than its host body, both the host body and the cancer die. Simple as that, no exceptions.
Congress is dragging their feet like IBM, GM, Kodak, Bethlehem Steel and countless other organizations who’s spending outgrew their revenue stream. Same story for the mighty British empire, Spanish empire, Roman empire, etc, etc.
Uncle Sam is going to get a lot smaller, either by drastic spending cuts or by collapse.
Two percent growth isn’t going to pay the bills.
Debt is already a constraint to growth, and increasing the debt ceiling will just lower growth prospect further. We also know that higher taxes (shifting more resources from the private sector into the soviet socialist sector) will also lower growth.
There is no way the US government can keep its size and scope. At its current size, the government is suffocating its own tax base. When a cancerous growth gets to be bigger than its host body, both the host body and the cancer die. Simple as that, no exceptions.
Congress is dragging their feet like IBM, GM, Kodak, Bethlehem Steel and countless other organizations who’s spending outgrew their revenue stream. Same story for the mighty British empire, Spanish empire, Roman empire, etc, etc.
Uncle Sam is going to get a lot smaller, either by drastic spending cuts or by collapse.
Two percent growth isn’t going to pay the bills.
. , etc.
. , etc.