Rep. Kevin Brady (R-TX), Vice Chairman of the Joint Economic Committee, responding to today’s announcement that real gross domestic product grew at an annualized rate of 2.0% during the 3rd-quarter of 2012, cited President Obama’s devotion to big government as the “primary reason” for the delay in America’s return to prosperity. “The lack of economic growth is one of the major factors driving up the national debt,” Brady said.
“The Obama recovery remains the worst recovery this nation has witnessed since World War II. Total real GDP has increased a meager 7.2% since the recession ended more than three years ago. The other nine recoveries averaged a total growth in GDP of 16.8%. And Reagan’s recovery added 19.6% to real GDP.”
“If this recovery had simply been average, real GDP would be $1.2 trillion higher and a Reagan-like recovery would have meant an economy $1.6 trillion bigger than it is today. And a bigger economy would mean more jobs and better pay.”
Brady cited anemic economic growth as a major contributor to the nation’s budget deficit and burgeoning national debt. “The President could have met his pledge to cut the deficit in half if he had put pro-growth policies in place. Under an average recovery, where revenues returned to their 2007 level of 18.2% of 3rd-quarter GDP, federal revenues would be $653 billion higher. That alone would slash the deficit by more than half. A Reagan-style recovery would have produced $722 billion in additional revenues and cut the deficit by two thirds. ”
“Instead, the President’s anti-growth, big government agenda has burdened us with four consecutive years of trillion dollar deficits and a $16.2 trillion national debt. We must focus on growing family incomes instead of redistributing them. America needs a growth dividend to create jobs and increase middle class incomes. Americans don’t need sloganeering about ‘fairness.’ ”
Brady’s comments on the effect of higher economic growth on the budget deficit are based upon an analysis by the Republican Staff of the Joint Economic Committee.