Kevin Hassett, chairman of the White House Council of Economic Advisers, said the trend of low economic growth has been broken by President Donald Trump’s policies which are driving the U.S. economic rebound.
“We’ve gone from a new normal of low growth to just normal which is the 3% growth that Americans are used to expect, ” Hassett told reporters on Tuesday.
The White House summarized the state of the economy by looking at GDP growth over the previous year. Currently, the economy is growing at a rate of slightly under 3%, compared to the Obama administration which experienced growth of under 2%.
The Atlanta Federal Reserve’s GDPNow is forecasting that U.S. third-quarter GDP will grow at an annualized rate of 4.1%.
In December 2017, Trump signed into law the largest overhaul of the nation’s tax code since 1986. As a result of passing the Tax Cuts and Jobs Act (TCJA), Hassett said, business sentiment is on the rise and CEOs are more confident.
“Higher capital spending is exactly one of the key factors driving growth at this time,” he said.
Along with big business, small business optimism is also hovering around record levels, as tracked by the National Federation of Independent Businesses, in part thanks to the Trump administration’s campaign to reduce regulations and taxes.
“Small businesses are as optimistic as we’ve ever seen since we began surveying them,” Hassett said.
The White House pointed to the unemployment rate at 3.8%, the lowest rate since 2000, as a sign that the job market is at its strongest level.
“The job market right now is about as strong as I ever seen,” Hassett said.
Hassett also highlighted that the U.S. labor market racial gap in the unemployment rate is at an all-time low and about a third of what it was on average during the Obama administration.
“We want that gap to get all the way down to zero, but we made a tremendous amount of progress because President Trump is still working to heat up the economy,” he said.