President Trump is presiding over an economy that is soaring; according to the Congressional Budget Office’s budget and economic outlook, real Gross Domestic Product will grow by 3.3% from the fourth quarter of 2017 to the fourth quarter of 2018. That would be the highest level of growth in 15 years.
The CBO report states, “In CBO’s projections, real GDP expands by 3.3 percent this year and by 2.4 percent in 2019. It grew by 2.6 percent last year.” As CNS News reports, “The last time real GDP grew by more than 3.3 percent from the fourth quarter of one year to the fourth quarter of the next was in 2003, when it grew by 4.4 percent, according to the historical data published by the Bureau of Economic Analysis.”
And guess who is responsible for this good news? A GOP president and Congress, apparently. CBO notes, “CBO significantly boosted its projections of the growth of real GDP in 2018 and 2019, mostly because of the recent changes in fiscal policy.”
Speaking to the House Budget Committee on April 12, CBO Director Keith Hall stated, “In our economic projections which underlie our budget projections, inflation-adjusted GDP — or real GDP — expands by 3.3 percent this year, and by 2.4 percent in 2019. Most of this growth is driven by consumer spending and business investment, but federal spending also contributes a significant amount this year.”
Hall added, “In our projections, the effects of the 2017 Tax Act on incentives to work, save and invest, raise real potential GDP throughout the 2018 and 2028 period. Over the same period, the Tax Act is projected to boost the level of real GDP by an average of 0.7 percent and nonfarm payroll employment by an average of 1.1 million jobs.”
CBO’s budget outlook noted that CBO had increased its projections of economic growth for this year and next year.
CNS News reports:
In addition to projecting the percentage change in annualized GDP from one fourth quarter to the next, the CBO budget and economic outlook also projects the percentage change in real GDP from one full year to the next. By this other measure, according to CBO, real GDP will grow 3.0 percent in 2018. That would be the largest percentage change in GDP from one year to the next since 2005, when real GDP, measured this way, grew by 3.3 percent. In the years since 2005, real GDP by this measure peaked at 2.9 percent 2015. Thus, by this second measure, CBO is projecting real GDP will hit a 13-year high.