BUDGET/ECONOMY: “The White House’s budget proposal—to be released Monday [2-12-18]—assumes the economy can grow at a much stronger pace than independent forecasters expect and with lower inflation and government borrowing costs than officials projected last year, according to a preview of the proposal.
Strong growth assumptions with relatively low borrowing costs, particularly in the back half of the budget’s 10-year forecast, help to show much smaller deficits as a share of the overall economy.
The budget proposal projects the economy will grow about 3% annually over the coming decade, though officials now expect a slightly larger near-term boost, with output rising 3.2% next year before declining to 3% in 2021 and 2.8% by 2026, according to projections reviewed by The Wall Street Journal.
The U.S. economy grew at a 2.5% pace last year, slightly ahead of the 2.3% projection made in President Donald Trump’s budget proposal last year.
Many private forecasters also expect economic growth to pick up this year because of consumer and business spending encouraged by tax cuts signed by the GOP president in December, plus a two-year, $300 billion funding deal signed Friday.
But many don’t see quite as large an increase as the administration, and they don’t see the boost lasting for nearly as long. On Friday, economists at J.P. Morgan said they now expect the economy to grow 2.6% this year and 1.9% next year.”
-Nick Timiraos, “White House Budget to Project 3% Growth,” The Wall Street Journal online, Feb. 9, 2018 07:17pm