2013 August 18 Sunday
J.P. Morgan: US Economy Will Stay At 1.75% Growth Rate
J.P. Morgan bank economists are not bullish on America. This bodes very poorly for the welfare state. Only a rapidly growing economy can produce enough wealth to enable growing tax revenue to pay for all the promised entitlements. Slow growth means the entitlements will have to get cut down.
As computer advances enable employers to automate the work of lower intelligence workers I expect productivity of the remaining workers to rise. We've got to reach the point where dummies become such a small portion of the labor force that those who work have IQs well above 100 on average. The exodus of lower IQ workers from the work force will cause a measured rise in the average productivity of those still working. Rising productivity will be trumpeted. But growing and increasingly unemployed lower classes will become a big problem.
As robots and computers destroy more jobs my expectation is that businesses will move their robotic factories to a few low population countriesin order to reduce taxes.
By Randall Parker at 2013 August 18 09:47 PM
The US GDP growth rate from 1947 to 2013 averaged 3.23%. So the forecast of 1.75% growth is slightly more than half of the historical average, and even that may be optimistic. The future of the vast underclass of low IQ, low income Americans is indeed bleak.
>>The US GDP growth rate from 1947 to 2013 averaged 3.23%. So the forecast of 1.75% growth is slightly more than half of the historical average, and even that may be optimistic. The future of the vast underclass of low IQ, low income Americans is indeed bleak.
It will be bad for the haves on the right end of the curve too. They will be sorely disappointed that their wealth and achievement will do little to protect them from the indignities of poverty in the manner of the poor storming their gates. One way or another, the poor will take their wealth and comfort.
I would rather have been a blue collar American of the 1950s-70s than any multimillionaire living in, say, Bombay, Cairo or Sao Paulo. And I mean this in the sense of financial, environmental and cultural well being.
If they estimate 1.75%, any slight shock to the system or a continuing rise in interest rates will sink that number lower or push it negative. We also have more sequester fiscal drag coming. Thank God for those shale oil and gas workers and investments or we would have been horrible screwed the last 4 years.