We Americans have long been obsessed with economic growth — “prosperity” in everyday lingo. The idea that we have some sort of special aptitude for invention, wealth creation and economic self-improvement is part of our imagined national character. It’s who we are. Not only that, but prosperity also plays a crucial political role. It enables us to raise living standards and construct a society with greater economic and social justice.
We’re not just good at this; we’re better than everyone else. Or so we thought. President Trump’s popular appeal rests heavily on our loss of confidence in this vision. And it’s not only Trump. Though critics reject his remedies (high trade tariffs, huge budget deficits, tax cuts for the wealthy), they share his worry that America is apparently losing its economic vitality.
The change is real. If you examine the basic indicator of the economy’s size — gross domestic product, or GDP — there clearly has been a break from the rapid growth of the early post-World War II decades. From 1950 to 1973, the economy grew at an average annual rate of 4 percent, reports the Congressional Budget Office. More recently, growth from 2008 to 2017 — the Great Recession and the recovery — averaged only 1.5 percent.
