WASHINGTON—Republican presidential candidate Jeb Bush says there’s “not a reason in the world” why the U.S. economy can’t grow at 4 percent annually.
Actually, there are a bunch of reasons it probably can’t.
Many economists say the U.S. economy is ill equipped to grow consistently at even close to 4 percent. Current forecasts put growth averaging half that rate. Any president, Republican or Democrat, would have to overcome decades-long trends that are largely beyond the control of the Oval Office.
Those trends include the retirements of the vast generation of baby boomers — an exodus that limits the number of workers in the economy. Rising automation and low-wage competition overseas are among other factors. A result has been meager income growth, which has cut into the consumer spending that drives most economic growth.
“It would require substantial changes in fiscal and regulatory policy that I don’t believe any president could reasonably expect to enact in one term,” said Robert Stein, an economist at First Trust Advisors who was a Treasury Department official during George W. Bush’s presidency.
