Wednesday, October 12, 2016
What's The New Normal For US Growth Rate?
The Federal Reserve Bank of San Francisco examined the main factors that determine the US economic growth rate and concluded that the new normal will below 2%. The slow growth rate is the result of slow growth in the labor force, a plateau in human capital growth caused by growth in higher education, and slow productivity growth. The report describes some of the tools that government might use to promote a higher growth rate but implementation would require a functioning government that was interested in governing. It is wishful thinking to believe that this will happen. Our current presidential election indicates how polarized the US has become as a nation.