Tags: Trump Administration | Trump | Budget | Economic | Growth | Nussle

Ex-OMB Director Nussle: Trump Budget Will Only Spark 1.9 Percent Growth

(Dreamstime)

By    |   Tuesday, 23 May 2017 11:25 AM

President Donald Trump's new budget is only good for 1.9 percent economic growth rather than the 3 percent widely promised, former Office of Management and Budget Director Jim Nussle warned.

"When you say we're going to get to 3 percent growth and then you paint a picture of how you're going to get to 3 percent growth, most economists say that's unrealistic given the current trend line," Nussle, who served under the George W. Bush administration, told CNBC.

The Congressional Budget Office currently estimates growth at about 1.9 percent and the Federal Reserve projects the economy will expand at a 1.8 percent annual rate.

"Over the history, CBO has been closer to being correct on these numbers. Being at 1.9 as opposed to 3 is probably more realistic," he added.

Nussle, also a former Republican congressman from Iowa, said if the economy doesn't reach 3 percent growth the Trump administration is likely to blame lawmakers for not pushing through the president's policies.

"So, when they don't pass it and we don't get to 3 percent growth, they're going to say, 'Well that's because you didn't pass my plan,'" Nussle said. "I think that's maybe the reason why they would put it out in this kind of format."

Current Office of Management and Budget Director Mick Mulvaney said that the Trump administration stands by its forecast and that economists are underestimating the benefits.

"That assumes a pessimism about America, about the economy, about the people, about its culture that we're simply refusing to accept," Mulvaney said. "We do not believe that [3 percent] is something fanciful."

To be sure, the Trump administration believes its budget plan will boost economic growth by fostering capital investment and creating jobs for workers who gave up their job hunts during tough times, Treasury Secretary Steven Mnuchin said on Tuesday.

"One component of this is making sure we can create jobs for people who want jobs and will come back into the workforce," Mnuchin said at an event on fiscal policy. "The other component is productivity and capital investment," Reuters cited him as saying.

However, Newsmax Finance Insider Stephen Moore takes issue with such narrow-minded thinking.

"The naysayers are dead wrong. Start with the tax plan that Larry Kudlow and now-Treasury Secretary Steven Mnuchin and I put together for Donald Trump during the campaign," Moore wrote in his blog.

"That plan cuts U.S. business taxes from 35 percent (the highest in the world) to 15 percent (which would be among the lowest rates in the world). This will lure more jobs and businesses back to the United States. Apple CEO Tim Cook says the Trump tax plan could bring $250 billion of Apple profits back to these shores, where it can be reinvested in Michigan, Ohio, California and so on rather than Ireland, China or Europe," Moore wrote.

"The plan also simplifies the tax system and cuts the taxes of 26 million small businesses, which create about two-thirds of the new jobs in America. Without healthy, prosperous employers, you can't have healthy, well-paying jobs," Moore wrote.

"This alone can boost economic growth by as much as 1 percentage point per year and will generate about $3 trillion more tax revenue over the next decade," wrote Moore, a distinguished visiting fellow at The Heritage Foundation.

(Newsmax wires services contributed to this report).

© 2017 Newsmax Finance. All rights reserved.

 
1Like our page
2Share
StreetTalk
President Donald Trump's new budget is only good for 1.9 percent economic growth rather than the 3 percent widely promised, former Office of Management and Budget Director Jim Nussle warned.
Trump, Budget, Economic, Growth, Nussle
555
2017-25-23
Tuesday, 23 May 2017 11:25 AM
Newsmax Inc.
 

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved