Tax reform has boosted America’s economy. Before President Trump signed last year’s tax overhaul, economic projections by the nonpartisan Congressional Budget Office (CBO) and other experts had GDP growth pegged at around 2%. Last Friday, it was announced that America’s economy grew 3.5% in the third quarter of 2018 – putting this year’s growth rate at 3% year over year.
This is an exciting departure from the low-growth economy we’ve endured since the Great Recession ended nearly a decade ago. After averaging only 1.9% growth during the expansion, the last decade saw the weakest recovery in American history and led to hard times for many Americans.
Thankfully for hardworking families and workers, tax reform has changed all that. Not only are we on track for the first full year of 3% growth since 2005, we’ve also seen historic highs in Main Street business optimism.
This has helped create one of the best job markets in the modern era – with the lowest unemployment rate and unemployment claims since 1969, more job openings than unemployed workers, and the fastest wage growth in a decade. In fact, Blue Chip forecasters expected job growth to average 166,000 jobs per month this year – but once again the actual numbers were higher with 208,000 jobs created per month – bringing the total to 1.9 million net new jobs this year. Medicaid claims have also dropped for the first time in over a decade as more Americans have moved from the sidelines to good-paying jobs including health coverage.
Before tax reform our outdated, uncompetitive tax code was holding our economy back and hindering business investment in our communities. After the Tax Cuts and Jobs Act was signed into law last December, business investment has risen beyond expectations. For example, CBO projected 3.4% growth in investment in this year’s third quarter. After tax reform they revised it up to 6.1%. But the actual data came in at 6.4% – nearly twice the pre-tax reform expectations.
It’s clear that this positive change is thanks to the Tax Cuts and Jobs Act. The pro-growth tax code has altered the trajectory of the American economy – giving us more jobs, bigger paychecks, and increased business investment. That’s because it was designed to help American companies and workers compete and win anywhere in the world.
It’s no surprise that for the first time since 2008 America’s economy has once again been ranked the most competitive economy in the world. That’s because we now have one of the most competitive tax codes on the planet that’s boosting growth and helping families.