The chief global strategist of financial services giant JPMorgan says that the White House’s growth projections for the US economy are unfeasible.
In a new interview with CNBC Television, JPMorgan executive David Kelly says that the White House’s 3% projected growth for the economy doesn’t make sense as the US doesn’t have the means to boost productivity to match.
According to Kelly, baby boomers retiring and shrinking employment numbers will impact the growth of the US economy. However, though he says 3% is untenable, he does envision the economy growing in part.
“I don’t see how we’ll do that. In order to do that, you’ve got to boost productivity, because if you look at the US economic growth, in the long run, so far this century, it’s been about 2%. That’s 1.5% from productivity and 0.5% from the growth in labor.
The problem is that the baby boomers are retiring, the nation-born working age population is shrinking, so if you end up with zero net immigration, you got no employment growth and that means [you grow] 1.5%, not 3%. Now we might do better than 1.5%, but we’re not close to 3%. There’s nothing in the outlook which tells me that we can sustain 3% growth.”
The White House’s projection for the growth of the US economy is related to President Donald Trump’s latest spending bill, which included extensions on tax breaks and is currently being voted on in Congress.
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