OMB Director Mick Mulvaney attends the daily White House press briefing and fields questions about the President Trump ‘America-First’ budget.
Director Mulvaney does an exceptional job explaining the larger budgetary issues, priorities and squashing some of the more ridiculous media narratives du jour.
Regarding the non-discretionary side. I would remind all:
Trump Economics – […] As the wage rate increases, and as the economy expands, the governmental dependency model is reshaped and simultaneously receipts to the U.S. treasury improve.
More money into the U.S Treasury and less dependence on welfare programs has a combined exponential impact. You gain a dollar, and have no need to spend a dollar. That is how the SSI and safety net programs are saved under President Trump.
When you elevate your economic thinking you begin to see that all of the “entitlements” or expenditures become more affordable with an economy that is fully functional.
As the GDP of the U.S. expands, so too does our ability to meet the growing need of the retiring U.S. worker. We stop thinking about how to best divide a limited economic pie, and begin thinking about how many more economic pies we can create. (link)
Wage rates are increasing as would be expected with inflationary increases in ‘non measured’ high-turn consumable goods.
Year-over-year same month comparable wage rate analysis in February showed a +2.9% increase; that’s more than double the inflationary rate measured by the Fed in the analysis which led them to raise interest rates .25% two days ago.
WASHINGTON DC – With the labor market near full employment, wage growth could speed up as companies are forced to raise compensation to retain employees and attract skilled workers. A proxy for take-home pay rose a solid 0.5 percent in February.
The annual wage increase is close to the 3 percent to 3.5 percent range that economists say is needed to lift inflation to the Fed’s 2 percent target. Inflation is already firming, in part as commodity prices rise.
Rising inflation, together with a tighter labor market, stock market boom and strengthening global economy, has left some economists expecting that the Fed could increase rates much faster than currently anticipated by financial markets.
The U.S. central bank lifted its benchmark overnight rate in December and has forecast three rate increases for 2017. (link)
People are coming off the sidelines to re-engage in the workforce. This leads to less dependence on social safety nets, subsidy programs, and unemployment insurance distribution.
For every new worker, formerly unrecorded in the unemployment rate, who gets a job and pays taxes that has a compounding impact. Tax payment to the treasury, combined with no longer a need to spend from the treasury on social welfare. The savings are doubled.
It is the Trump economic expansion that will sustain the “entitlement” and “retirement” programs. Follow Trump’s economic expansion plan and those prior fiscal concerns become lesser. It’s a multi-step, multi-stage process:
- √ Create the economic environment (meet with CEO’s – get buy in)
- √ Deconstruct regulatory choke points (EPA – Pruitt)
- Eliminate the significant drags on the economy (ObamaCare)
- Curtail the expansion of government (Budget)
- Apply new trade principles giving domestic manufacturers equity and level options.
- Inject additional one-time investment (repatriation – quick start) infrastructure.
- Restructure tax systems to push further long-term investment and growth.