U.S. economy records fastest growth since 2014

Trump Breaks Tradition on GDP Figures

Trump Breaks Tradition on GDP Figures

On Friday, the Commerce Department reported that the US economy grew at an annual rate of 4.1 percent between April and June. Still, the president claimed the next quarter's numbers will be even better.

Economists' forecasts for second-quarter GDP, the value of all goods and services produced in the nation, ranged from 3 percent to 5 percent.

"We must replace the present policy of globalism - which has moved so many jobs and so much wealth out of our country - and replace it with a new policy of Americanism", Mr. Trump said in a September, 2016, speech before The New York Economic Club.

"We've accomplished an economic turnaround of historic proportions", he said.

THE FACTS: Trump is correct that a lower trade deficit helped growth in the April-to-June quarter, but it's not necessarily for a positive reason.

Pay was growing even faster in the late 1960s, when the jobless rate remained below 4 percent for almost four years.

News this week that the Republican Party is quickly moving ahead with their "tax cuts 2.0" plan-which would double-down on tax cuts for the rich and corporations-seems to suggest that Trump and the GOP are wholly uninterested in working to ensure that economic growth is distributed equitably. First, consumer spending rose 4 percent.

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Overall, the-second quarter GDP release points to an economy with remarkable momentum, as both consumers and businesses are in a position to continue spending heartily for the foreseeable future.

In any case, I am skeptical that the trade deficit will shrink markedly in the near term, as the USA economy is stronger than that of most of our trading partners and in an economy suffering from a shortage of skilled labor, importing more to satisfy robust consumer and business demand can be a vital release valve.

Economists say the spike is coming mainly from a fluke: There was an unusually large increase in exports in the spring that probably came because other countries were trying to buy us goods before Trump's trade war escalated and tariffs kicked in.

Personal consumption expenditures increased 4 percent while business investment jumped 7.3 percent, and government spending was up by 3.5 percent. The U.S. federal budget deficit is expected to surpass US$1-trillion in 2019 and the federal debt, which Mr. Trump vowed to reduce, will soon surpass US$22-trillion.

President Trump thinks this is just the beginning.

"This morning's data confirms that growth has accelerated and that inflation is running close to the target", the report said. With Friday's report, the government also published comprehensive revisions to prior GDP data, which did not change the previously presented economic picture. It followed first-quarter growth of 2.2 percent that was revised from 2 percent, the Commerce Department reported Friday.

The current economic expansion, which began in June 2009, is now the second-longest on record but also the weakest.

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