Tags: larry kudlow | stephen moore | economy | trump

Kudlow, Moore: If This Economy Is Overheated, We'll Take More of It

Image: Kudlow, Moore: If This Economy Is Overheated, We'll Take More of It
Larry Kudlow (Bryan R. Smith/Getty Images)

By    |   Tuesday, 13 March 2018 02:20 PM

The "Chicken Littles" are out in full force, issuing dire warnings about an overheated economy and inflation induced by rapid growth, fears that are as misplaced now as they have been for decades, Larry Kudlow and Stephen Moore wrote in a column for The Wall Street Journal.

"The fear that rapid growth will drive inflation isn't new, but history shows that the connection is tenuous and that booming economies lower rather than increase prices," the pair wrote in the Journal.

"The two of us are inflation hawks who want dollar and price stability. But worries about growth-driven inflation have often been misplaced, as when they last surfaced in the 1980s," they wrote.

Moore and Kudlow, reportedly the front-runner to become President Donald Trump's top economic adviser, write that the president's supply-side growth strategy that is pumping up wages to where they should have been all along.

"There is no sign that this growth rate is too much for the economy to handle; rather, it is a return to the high growth rates that the U.S. sustained during many low-inflation periods of the 20th century," the pair write. "And yet for many these results have been overshadowed by fear that inflation must be looming."

The origin of those fears was born in the 1960s, and it's an "enduring myth" that "doesn't comport with the facts, then or now."

"Mr. Trump's tax-cutting and deregulatory policies are already pushing out the supply curve, creating real growth that isn't inflationary," the pair write.

"For workers this is the best of all worlds: A surge in capital investment, higher corporate productivity and profits, and a tight labor market. If this is 'overheating,' we want much more of it," they conclude.

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The "Chicken Littles" are out in full force, issuing dire warnings about an overheated economy and inflation induced by rapid growth, fears that are as misplaced now as they have been for decades.
larry kudlow, stephen moore, economy, trump
286
2018-20-13
Tuesday, 13 March 2018 02:20 PM
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