Politics

Trump triumphant: 'We're going to go a lot higher' than 4.1% GDP growth

Key Points
  • "We're going to go a lot higher than these numbers, and these are great numbers," the president said.
  • Earlier Friday the government announced that the economy grew in the second quarter at the fastest pace in nearly four years. The nation's GDP grew 4.1 percent, in line with estimates.
  • Trump had previewed the economic data on Thursday, during a speech in Illinois. Trump said of the indicator, "If it has a 4 in front of it, we're happy."
Trump: We're on track for best economy in 13 years
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Trump: We're on track for best economy in 13 years

President Donald Trump pitched his economic record to voters Friday, boasting that strong numbers released earlier in the morning were "sustainable" and blasting Democrats for wanting to "raise everybody's taxes."

"We're going to go a lot higher," Trump said, referring to the report that showed a 4.1 percent rise in gross domestic product during the second quarter. It was the highest quarterly jump in nearly four years.

During a speech on the White House South Lawn, he predicted that the country was on track for its highest annual growth rate in over 13 years.

"As the trade deals come in one by one, we're going to go a lot higher than these numbers, and these are great numbers," he said.

The president also championed the GOP tax overhaul passed late last year, saying that "as a result, more than 6 million Americans are enjoying new bonuses, better jobs, and far better paychecks." The president said that Democrats' efforts to turn back the tax cuts would be a "disaster for our economy."

Here's how experts and analysts reacted to Friday’s big GDP number
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How experts reacted to Friday’s big GDP number

"As you know, the Democrats want to end that and raise everybody's taxes," Trump said, referring to the GOP tax plan.

It's not clear that the Republican tax plan has resulted in increased wages. The Bureau of Economic Analysis noted Friday that personal income growth, in the form of wages and salaries, decelerated in the second quarter despite the GDP increase. Real wages have remained stagnant over the past year, according to government data.

Meanwhile, corporations have boosted their stock buybacks and cash distributions to shareholders, which have accelerated at a record pace. Bloomberg reported in May that 2018 was on track to be the first year in which shareholders saw a $1 trillion windfall from stock buybacks.

By pumping up expectations for U.S. economic growth for the remainder of the year, Trump raised the political risks for Republicans in November's midterm elections and for himself for a 2020 re-election bid.

He called the numbers "very, very sustainable" and predicted that the U.S. would "do extraordinarily well" in its third-quarter GDP report.

The president acknowledged the peril if the economy does not match his rosy outlook. "I won't go too strong" in my projections, "because then if it's not quite as good, you won't let me forget it," the president said.

Republicans hope a strong economy will help to prop them up as they try to stop an energized Democratic Party from taking a House majority in November. That strategy underscores why the president gave his previously unscheduled remarks on the economy following the GDP report.

The president cited the low unemployment rate among minorities and women, and repeated his claim that "we've been ripped off by the world," a point that the president has used to make his case for renegotiating trade deals with foreign leaders.

On Wednesday, he announced that he had secured concessions from the European Union after a meeting with European Commission President Jean-Claude Juncker.

"The trade deficit, very dear to my heart because we've been ripped off by the world, has dropped off by more than $50 billion," Trump said Friday.

He compared his economic numbers to those of Presidents George W. Bush and Barack Obama.

"During each of two previous administrations, we averaged just over 1.8 percent GDP growth. By contrast, we are now on track to hit an average GDP annual growth of over 3 percent, and it could be substantially over 3 percent," Trump said. "Each point, by the way, means approximately $3 trillion and 10 million jobs."

After the government's GDP report, Trump proclaimed in a post on Twitter that the figure was "GREAT."

The number was buoyed by increased consumer spending and business investment. Economists warned the number may have been artificially boosted by a flood of exports in the second quarter as countries race to get American goods, such as soybeans, that could be harder to come by if further tariffs go into effect.

Trump had previewed the economic data on Thursday during a speech in Illinois. Trump said of the indicator, "If it has a 4 in front of it, we're happy."

Trump's top economic advisor, Larry Kudlow, also played up the GDP number before its release. Kudlow told Fox Business on Thursday that "you're going to get a very good economic growth number tomorrow, big." He said later in the interview that he didn't know what the number would be.

The president has been keen to use the booming economy as one of his key pitches to voters ahead of this fall's midterm congressional elections. Democrats are slightly favored to regain control of the House, while Republicans are expected to maintain a thin majority in the Senate. The campaign is widely seen as a referendum on Trump's early days in office.