US Economy - News, Updates and Discussion
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AZ_HighCountry
INT'L MOD
Good luck with that. As much as I support such an idea, the SCOTUS has already said otherwise and too many on both sides of the aisle in Congress would never support it.
Davey Crockett
Elite Member
Davey Crockett
Elite Member
AZ_HighCountry
INT'L MOD
The only solution is revolution.....
Too many lazy Americans. They've been sufficiently dumbed down.
F-22Raptor
Elite Member
America is experiencing a productivity miracle
As with many a miracle, onlookers disbelieved their eyes at first. For a decade after the global financial crisis of 2007-09 rich-world productivity growth was, by historical standards, dead. Since economic prosperity ultimately depends on the ability to produce more with the same labour, this consigned even prosperous America to eternal stagnation (and don’t ask about Europe).
The Congressional Budget Office, a fiscal watchdog which consistently overestimated productivity growth in the 2010s, has been consistently glum this decade (see charts 1 and 2). Partial data hinting otherwise were dismissed as false prophets.
But those data kept coming. And now they are indisputable: over the past five years or so American productivity has been growing at the fastest rate in around two decades. Whether you look at non-farm businesses’ output per worker or per hour, it has risen by a lively 2% a year, from a moribund 1% for most of the 2010s (see chart 3). This has led the Federal Reserve to raise its median forecast for America’s long-run gdp growth from 1.8% to 2%. Jerome Powell, the outgoing chair, bore witness at a recent press conference. “I never thought I’d see this many years of really high productivity,” he marvelled in response to a question from The Economist.
It is too early to credit artificial intelligence for the resurrection. Productivity began picking up in the early 2020s, whereas large language models have come into real commercial use only in the past year or so. If previous technological revolutions are anything to go by, the ai age will take at least a few years to show up in productivity statistics. The main macroeconomically discernible impact of the ai boom so far has been on business investment, particularly in data centres.
To divine the real causes of the phenomenon, The Economiststarted by poring over official data on productivity growth by sector since 2000 from America’s Bureau of Labour Statistics. Between 2019 and 2024 the “information” industry—which covers areas from software and telecoms to publishing and film-making—came top with an annual rate of around 6%. That was no higher than the annual average in 2000-19.
Nor is America’s recent uptick the consequence of this particularly efficient industry accounting for a bigger slice of the economy: in the past six years the sector’s share of total American output has hovered between 5.3% and 5.5%.
Instead, some of the biggest jumps in productivity growth have come in professional services and management (see chart 4). Together, these make up around 10% of the American economy, up a little from 2019. They are the sorts of businesses that do not produce new technology, but are voracious users of it. In the past few years America’s suits have at last taken full advantage of the signature innovations of the 2010s: smartphones, cloud computing, videoconferencing and the like.
Productivity growth also sped up in oil and gas. The shale-fracking revolution of the 2010s turned America from a net energy importer to an exporter. In 2023 it sold half as much energy abroad, net of imports, as Saudi Arabia. Since then, construction of new liquefaction plants for natural gas has allowed America to send the fuel to Europe and Asia, where it fetches higher prices than at home.
The indirect effects of America’s energy boom may be yet more consequential. Electricity is an input into just about everything and Americans pay half as much for it, on average, as Europeans and a third less than the Japanese. When it is inexpensive and abundant, workers and machinery can keep producing as much as possible without worrying too much about energy use. This helps explain why some energy-intensive businesses like mining and chemicals have not collapsed as they have in Europe.
Another factor behind the spurt in productivity growth is both fuzzier and more fundamental. The American economy remains unusually flexible, dynamic and innovative by rich-world standards. This makes it particularly adaptable, especially in times of crisis. Indeed, the start of the latest productivity boom coincided with nigh-biblical pestilence of the covid-19 pandemic—and in contrast to the previous big upswing over two decades ago other rich countries have not experienced the same miraculous revival this time.
Unlike much of Europe, for instance, America largely opted to hand out pandemic assistance in cash rather than pursuing complex schemes that tied workers to their existing jobs. When lockdown lay-offs began to be unwound, people were likelier to find new work in more efficient businesses—because these were the firms best placed to restart hiring.
The American economy is also taking more recent shocks in its stride. From the start of 2025 to March 2026, productivity growth was fairly solid—between 1.2% (per American worker including farmers) and 2.1% (per hour for non-farm business) at an annual rate. This was despite Donald Trump’s best efforts to the contrary in the form of anti-growth tariffs, mass deportations and attacks on institutions like the Fed. It is likely to survive the president’s strategically misguided war in Iran. And the ai age will probably show up in those productivity statistics sooner rather than later—even if the models never attain godlike powers. Expect the productivity miracle to continue. ■
America is experiencing a productivity miracle
AI hasn’t—yet—got much to do with it
Davey Crockett
Elite Member
Davey Crockett
Elite Member
F-22Raptor
Elite Member
Still far below Biden era inflation and mostly driven by fuel prices as core cpi remains under 3%
AZ_HighCountry
INT'L MOD
Feel free to spin it anyway you want to fit your view of the world. The indisputable fact remains that, adjusted for cost of energy, the inflation rate is a half percent higher than it was at this time last year.
Energy costs are real and those increases impact nearly every sector of the economy. Especially those that depend on transportation and logistics. You can deny reality all you want.
Pakistan Space Agency
Elite Member
Why was it high during Biden era?
AZ_HighCountry
INT'L MOD
Covid for one thing.
gambit
Professional
First, Spirit Airlines got problems before the Iran war. Jet Blue could have saved them, but it seemed the Biden Admin blocked the merger. Higher fuel cost just advanced the final bankruptcy.
Second, show me a single US president who made decisions, domestic and foreign affairs, that literally no one in the country was negatively affected somehow throughout his term. We can look ahead towards AI for one example of business, Congressional, and presidential initiatives that WILL cost jobs. Or how about offshoring American jobs and we can start with NAFTA under Bill Clinton. According to the oil industry, for every job that is zero degree from oil, at least 30 peripheral jobs are tied in with varying degrees of separation. If the focus is only on wars, then by your standard, no president would ever dare to even respond to an attack because wars always involves human cost. As much as I dislike Trump, the point of having a national leader is to make decisions that he, as best as he can deduced and be advised, has to make decisions that will affect everyone.
Finally, I understand that everyone in the ME hates US for multitude of reasons, and frankly, I do not care. But an individual calling 'Death To America' is not the same as 'Death To America' being a national directive and part of foreign policy.
mythbuster
SpeedLimited
As the saying goes ! America always does the right thing after it has exhausted all other options....for the past 80 years you have been setting up the policies/ rules for a world order that you believe suits you better and when you get screwed by your own rules and policies you start crying foul and turn into an obnoxious bully.... despite more than 200 years of continuous democracy, high literacy rates and vibrant economy your system has evolved into one of the most degenerative one among the advanced countries.... you, unabashedly , try to shove your system/ construct down everyone's throat.....you are a slave of a tiny minority , less than 2% of your population , the way your politicians and elites fawn before this minority is is absolutely disgusting.....why a tiny country, Israel , can have nukes but other countries in the middle east can't? ......you believe your shit doesn't stink and your life is more important than the live of other people?
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