Eco­nomic delu­sion

The Pak Banker - - OPINION - Cather­ine Ram­pell

For­get Jeb Bush's bold prom­ise of 4 per­cent eco­nomic growth , which Chris Christie sub­se­quently matched. Never mind Scott Walker's at­tempt to one-up them both, with a pledge of (wait for it) 4.5?per­cent growth. And ig­nore Mike Huck­abee's slightly higher am­bi­tion, re­cently of­fered in Iowa, of a whop­ping 6 per­cent growth.

Vote for me, my fel­low Amer­i­cans, and I swear I'll lav­ish this great na­tion with 100 per­cent growth. That's right: Let's dou­ble this sucker al­ready! Some may call my prom­ise - like those of­fered by other can­di­dates - ridicu­lous, pulled from thin air rather than from rig­or­ous eco­nomic anal­y­sis or even kinder­garten-level arith­metic. Given that an­nual eco­nomic growth has av­er­aged just 2.4?per­cent over the past two decades, crit­ics may con­sider my am­bi­tions naive or disin­gen­u­ous. Delu­sional, even.

But I say dream big, Amer­ica. If we're go­ing to de­lude our­selves, let's at least de­lude our­selves on a higher or­der of mag­ni­tude. Plus, un­like other can­di­dates, who of­fer scant sub­stan­ti­a­tion for their un­der­achiev­ing eco­nomic as­sur­ances, I ac­tu­ally have a road map for my ex­pan­sion­ary aims. Step one: Wage a re­ally, re­ally big war.

Wars can be great for eco­nomic growth, and not only be­cause they have his­tor­i­cally re­quired ramp­ing up pro­duc­tion of tanks, jets and Her­shey's bars. If we (or oth­ers) can man­age to de­stroy the cap­i­tal stock of our eco­nomic ri­vals while sus­tain­ing no dam­age to our own - which is, you know, ba­si­cally what hap­pened in World War II - we'll be per­fectly po­si­tioned for another global-com­pe­ti­tion-free, post­war eco­nomic boom. This lit­tle ar­ti­fact of the last post­war era, and how much it ex­plains the ro­bust mid20th-cen­tury growth rates that my pres­i­den­tial ri­vals now pine for, has cu­ri­ously eluded oth­ers' pol­icy plans. Step two: Con­tra Don­ald Trump, I say open the borders.

Much of our rapid-fire post­war eco­nomic growth was also at­trib­ut­able to women's ris­ing la­bor force par­tic­i­pa­tion rates, which ta­pered off at the turn of the 20th cen­tury. Since there's lit­tle ap­petite to­day for the kinds of poli­cies that would keep more women in the la­bor force, we should repli­cate this post­war out­put booster by in­creas­ing the ranks of another de­mo­graphic al­ready ea­ger to work: young, strap­ping, able-bod- ied im­mi­grants. Step three for ex­pand­ing the econ­omy: ex­pand what gets counted as "the econ­omy."

Think about it. When Italy be­gan in­clud­ing pros­ti­tu­tion, illegal nar­cotics and al­co­hol smug­gling in its out­put mea­sure last year, its econ­omy mag­i­cally got one full per- cent big­ger overnight.

Now con­sider all the black mar­ket trans­ac­tions that go un­tal­lied in the United States' of­fi­cial eco­nomic ledger. If we also throw in non-mar­ket house­hold pro­duc­tion such as un­paid child-care and house­work - gotta nab that home­maker vote! - we can add another 26 per­cent or so to the size of our econ­omy. All, mind you, in­stan­ta­neously, and re­quir­ing none of the painful de­ci­sions and trade-offs usu­ally in­volved in eco­nomic pol­i­cy­mak­ing. Step four: Don't just re­de­fine the bound­aries of the econ­omy; re­de­fine eco­nomic growth it­self.

In the past we've al­ways fo­cused on how quickly the U.S. econ­omy ex­pands over the course of a sin­gle year - that is, "an­nual growth rates." I pro­pose we in­stead mea­sure how quickly we can grow over a full two decades - what I like to call "bide­cen­nial growth rates." For ex­am­ple, com­pare the size of our econ­omy to­day to that in 1995. In raw, un­ad­justed dol­lar terms, we have al­ready more than dou­bled in size over that pe­riod, if you use my in­no­va­tive "bide­cen­nial growth rate" met­ric.

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