The Truth About “Pro-Growth” Economics

Like every president, Donald Trump has promised to make the economy grow faster. Good luck with that. In an article in Vox, I trace the history of the idea that we know how to make the economy grow faster. As I explain, while politicians love to talk about “pro-growth” policies, a productivity boom is not something Trump’s economic advisers, or anyone else’s, have the tools to bring about. Productivity depends mainly on private-sector decisions, and while government actions clearly influence it, the timing and extent of that influence are impossible to predict.

As I argue more fully in my new book, An Extraordinary Time, until and unless an unexpected productivity boom takes hold we’re likely to be stuck with an ordinary economy. That’s not terrible; at the moment, the United States is pretty close to full employment, and wages are on the rise. But it’s a far cry from the growth of 4 percent, 5 percent, or even 6 percent that Trump and some of his more zealous supporters have promised us. An effort to push the economy faster than underlying productivity improvements will allow is not likely to end well.

One thought on “The Truth About “Pro-Growth” Economics

  1. George Vining

    Dr. Levinson,

    I found your book very informative. I wonder if you could address the concept of “The Great Moderation” and the corresponding elevated policy hubris of many in the economics profession? (As I recall, some bellowed the business cycle had been tamed.)

    Thanks again for your research and publication efforts.

    Reply

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