Jeb Bush showed real presidential-level leadership in his formal 2016 presidential candidacy announcement, promising the delivery of a four percent economic growth rate:
There is not a reason in the world why we cannot grow at a rate of four percent a year.
And that will be my goal as president—four percent growth, and the 19 million new jobs that come with it.
As Neil Irwin from the New York Times notes in a blog post, “That Will Be Hard to Reach.” He predicts that such growth would be difficult to sustain “…absent a remarkable, rapid upward shift in the nation’s productive capacity.”
An article from Slate comments on Bush’s statement with skepticism, reasoning that, in reference to labor supply and worker productivity, “neither of these forces is working in America’s favor.”
The Wall Street Journal uses similar math to analyze the difficulty of achieving four percent growth, taking the requirements to be “reversing long-running trends in population, job participation and worker productivity.”
Ronald Reagan’s promises of high growth were received with similar skepticism. To achieve his vision, Reagan buckled down on inflation and led the nation out of a short recession and into soaring growth and job creation.
An article from Financial Times Alphaville sees Jeb Bush’s goal more optimistically, even suggesting that “[i]f anything, Bush may be aiming too low.”
Jeb Bush recently called out an under-recognized cause of a sluggish economy—bad monetary policy at the Fed:
…you can make a case that in the last few years, given our monetary policy, that we’ve been manipulating our currency. We’ve never had a time where our central bank is just printing money like nobody’s business. And that depreciates our currency. It lowers our interest rates and depreciates our currency.
As The Pulse has published before, monetary policy is a crucial component to restoring equitable prosperity to the economy. The best first step is to map the Fed’s wandering in “uncharted territory” by establishing a national monetary commission like the Brady/Cornyn Centennial Monetary Commission, which became a conservative cause célèbre designed to study the empirical results of the Fed’s policies and rules over its first 100 years.
Noah Muscente works for American Principles in Action.