The White House expects the U.S. economy to grow at 3 percent of gross domestic product (GDP) throughout President Trump’s tenure, far faster than projections released by several government agencies and economists.
Trump’s fiscal 2020 budget proposal, released Monday, includes one of the most optimistic visions of the country’s economic future despite mounting signs of an impending slowdown.
The proposal assumes that the U.S. economy will grow by 3.2 percent in 2019, 3.1 percent in 2020 and 3 percent through 2024 — the final year Trump is eligible to be president. The White House expects the economy to slump to 2.9 percent growth in 2025 and 2.8 percent from 2026 through 2029.
Trump campaigned on a promise to boost the economy to annual growth of at least 3 percent, which economists across the ideological spectrum dismissed as unrealistic. The economy grew by 2.9 percent in 2018, just 0.1 percentage points below Trump’s goal, and 3.1 percent between the fourth quarters of 2017 and 2018.
The White House projections for 2019 and 2020 are unchanged from its 2018 estimates for those years. They’re also far more bullish than projections issued by the Congressional Budget Office (CBO), Federal Reserve and a slew of private sector economists.
Analysts broadly expect the U.S. economy to slow in 2019 as the recovery from the 2008 recession appears to be fading in strength. Economists are also concerned that severe downturns in Europe and China could drag on the U.S.
The CBO, the nonpartisan budget scorekeeper for Congress, in January projected the economy to grow by 2.3 percent of GDP in 2019 and an average of 1.7 percent each year from 2020 through 2023.
The Fed in December also projected a 2.3 percent growth rate in 2019, 2 percent growth in 2020, 1.8 percent growth in 2021 and a longer-run average of 1.9 percent.
Fed Chairman Jerome Powell said in an interview aired Sunday that “growth this year will be slower than last year,” but expects it “to be positive and continue to be at a healthy rate.”
“Eventually, expansions come to an end. The business cycle has not been repealed,” Powell told “60 Minutes.”
“But I would say there’s no reason why this economy cannot continue to expand.”