29/05/2017
US
President Donald Trump's economic and financial program is based on a sustained
recovery of economic growth, but the weakness of this growth has led many
analysts to question whether the plan's goals can be achieved.
Although
the US Department of Commerce revised economic growth in the first quarter of
the year to 1.2 per cent against 0.7 per cent previously announced, this pace
remains weak compared to the fourth quarter of last year (+2.1 per cent).
According
to "French", winter does not usually encourage economic activity and
limit the growth of consumer spending, which is the engine of the US economy
during the last season to 0.6 percent, the weakest growth recorded since the
end of 2009.
As
for companies, investments have rebounded, particularly thanks to a rise of
(28.4%) in investments in infrastructure such as oil wells and mines, a sector
supported by the efforts of the Trump Department to promote energy production.
Trump Tramponomix, is based on the assumption of growth of up to 3 per cent
in 2018 and remains at that level for 10 years, a premise that is also based on
its budget projections just presented by its administration.
Economists
expect growth to accelerate in the second quarter, and expectations of the
Federal Reserve branch in Atlanta, which is often an optimistic standard, showing an annual growth rate of 4.1 percent, while economists
at Macro Economics expect 3.2 percent.
"Even
with growth of almost 3 per cent in the second quarter, this leaves us just
over 2 per cent of the growth in the first half of the year," Joel Narov,
an independent economist, said, adding: "I see no reason to believe that
companies and households will spend more in the coming months "He said.
"If
the economy is to grow as much as 3 per cent as far as we can expect, companies
will have to invest much more" in their productivity tools, he said,
adding that it is the only way to promote productivity, which so far shows no
signs of rising.
Trump
plan calls for tax decrease, especially for companies, deregulation of the
financial sector and motivates exports.
"We know that there are many economists who provide reasons why we can
not," Treasury Secretary Steven Menuchin defended his draft budget for
2018 of
structural growth at this pace, but we are firmly convinced that the economy
can return to a unified growth rate of 3 percent or more in this country.
"
The
annual growth rate in the United States since 2000 has not exceeded 2 per cent
due to the 2008 financial crisis and the lack of in productivity and population
aging.
The
latter is unlikely to improve if the administration continues anti-immigration
policies, but if we return to 1947, the average annual growth rate is 3.2 per
cent.
The
US Secretary faced a Senate panel with criticism from Democratic members who
asked him to include in the budget bill "rough calculations" and even
denounced a double counting of growth expectations.
The
Secretary responded to the criticism, stressing that the tax cuts contained in
the draft budget would be self financing without the deficit increasing, thanks
to the growth that would result from the tax.
Democratic
Senator Ron Wyden has said he was ashamed of even Bernard Madoff, who had
orchestrated the biggest fraud on Wall Street history, and his New Jersey
colleague Bob Menendez said it was "really vague."
Menuchin
said there was no double counting in the draft budget and he defended his plan:
" we are not advanced enough in terms of tax reform all the effects."
The
Federal Reserve fiscal policy, which measures Trump plan, is "increasingly
risky" for its growth and inflation expectations.
With
two interest rate increases expected this year, plus the expected reduction in
assets accumulated after the 2008 crisis that will reduce the cost of loans, that
could delay Donald Trump ambitions.
