President Donald Trump has repeatedly said he will bring the U.S. economy out from its sluggish state. His Budget Chief Mick Mulvaney announced that “MAGAnomics” will be the approach that the Trump administration will use to achieve its 3% economic growth goal.
“We introduced the term this week, which is called ‘MAGAnomics,’ which is sort of this unifying theme of everything we’re trying to do to get the healthy, traditional American economy back on track,” said Mulvaney, director of the White House Office of Management and Budget last week on Fox & Friends.
This strategy is similar to “Reaganomics,” where the former President Ronald Reagan reduce taxes and promoted an unrestricted free market.
The MAGA stands for Trump’s slogan, “Make America Great Again” and it will focus on tax reform, welfare reform, deregulation, healthcare reform, energy dominance and other sectors that will help to revamp the U.S. economy.
“It’s our version of Reaganomics. You go back and look at what Reagan did in the ’80s and the challenges they faced, and … we looked at the challenges we face,” said Mulvaney.
Mulvaney outlined the administration’s lofty goals and how it plans to achieve in a recent Wall Street Journal op-ed.
“Over the next 10 years, 3% growth instead of 2% will yield a nominal gross domestic product that is $16 trillion larger, federal government revenues $2.9 trillion greater, and wages and salaries of American workers $7 trillion higher,” wrote Mulvaney. “For merely suggesting that we can get back to that level, the administration has been criticized as unrealistic. That’s fine with us. We heard the same pessimism 40 years ago, when the country was mired in “stagflation” and “malaise.” But Ronald Reagan dared to challenge that thinking and steered us to a boom that many people thought unachievable. In the 7½ years following the end of the recession in 1982, real GDP grew at an annual rate of 4.4%. That is what a recovery looks like, and what the American economy is still capable of achieving.”
He points out that MAGAnomics will benefit all Americans.
“MAGAnomics is for everyone, but especially for those who left for work this morning in the dark but came home after their kids were asleep. It’s for those who are working part-time but praying for a full-time job. It’s for folks whose savings are as exhausted as they are. This president hears you. He knows America’s greatness doesn’t spring from higher taxes or unnecessary regulations or broken welfare programs. It doesn’t come from government at all. It comes from you,” writes Mulvaney. “If we enact the president’s broad agenda — if MAGAnomics is allowed to work — we will have set the stage for the greatest revival of the American economy since the early 1980s.”
Critics argue that the current healthcare challenges could have an impact on the economy, but Mulvaney believes that the GOP can pull together a worthy proposal by fall.
“While all of this discussion about healthcare has sort of made the news, Mr. Cohn and Mr. Mnuchin have been on the hill working with House and Senate leaders, House and Senate rank-and-file members to try and put some meat on that bone, and I think you’ll see a proposal very early in the fall,” said Mulvaney.
Author’s note: The last time, the U.S. saw the GDP growth over 3%, George W. Bush was in office. Tax reform and reregulation is sure to ramp up the economy. So far, the S&P 500 is up by 12% since Trump was elected. Not to mention, economic growth is expected to reach 2.3 % this year, which is drastically more than 2016’s 1.6%. 3% is not too far off considering the MAGAnomics policies haven’t even been put in place yet.