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Despite Trump’s claims, very few countries see 7 percent GDP growth

  • President Donald Trump on Wednesday said world leaders complain when their economies grow at less than 7 percent a year.
  • In 2016, only seven countries hit that mark.
  • Trump also repeated his belief that U.S. GDP is about to accelerate, a prospect that few economists expect to see happen.

On the stump for an overhaul of the nation's tax system, President Donald Trump on Wednesday said that cutting taxes would "bring back Main Street" and spur the U.S. economy to a level of growth not seen since the Great Recession.

"In the last 10 years, our economy has grown at only around 2 percent a year," Trump told the welcoming crowd in Springfield, Missouri. "You look at other countries and you look at what their (gross domestic product) is, they're unhappy when it's 7, 8, 9 [percent]. "

"And I speak to them, leaders of the countries, how are you doing?" Trump said. "'Not well, not well.' Why? 'GDP is down to 7 percent.' And I'm saying, 'We're hitting 1 percent.'"

For the record, the list of countries that could possibly express any emotion about their annual growth rates of 7 percent or more is extremely short. Of the nearly 200 countries whose economies are tracked by the International Monetary Fund, just seven saw real, inflation-adjusted gross domestic product rise by 7 percent or more last year.

The list includes Nauru, Iraq, Ethiopia, Uzbekistan, Cote D'Ivoire, Iceland and Cambodia, according to IMF data.

The Commerce Department reported Wednesday that U.S. gross domestic product grew at a 3.0 percent annual rate in the second quarter, the fastest pace since the first quarter of 2015 and up from a 1.2 percent pace in the January-March period. Economists had expected that second-quarter GDP growth would rise to a 2.7 percent rate.

"On a yearly basis, as you know, the last administration during an eight-year period never hit 3 percent, so we're really on our way," Trump said in his Wednesday speech. "And I happen to be one that thinks we can go much higher than 3 percent. There's no reason why we shouldn't."

Given the slow pace of first-quarter growth, the economy would have to accelerate substantially to end 2017 with an annual gain of 3 percent, an outcome most economists believe is highly unlikely.

Though overall tax cuts could help spur growth, the U.S. economy has slowed in the last decade, based in part on a slowdown in productivity and an aging workforce.

Trump's campaign promise to cut taxes already faces political headwinds.

The White House and Republican lawmakers have not finalized a plan and the effort comes amid a busy September for Congress. The agenda includes raising the federal debt ceiling and extending the federal flood insurance program that is under financial strain and expected to see heavy claims from Hurricane Harvey.

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