What’s Really Behind America’s Slumping GDP Growth?

On December 6, the Gallup organization together with the U. S. Council on Competitiveness published a jolting study demonstrating that the pervasive sense among Americans that the U. S. is in economic decline isn’t imagined. It’s real and it’s dangerous.
The study was conducted by Gallup’s Senior Economist, Jonathan Rothwell, with other Gallup experts and external scientists serving as reviewers to ‘ensure statistical and theoretical accuracy and objectivity,’ according to Gallup Chairman and CEO Jim Clifton.
The problem, in a nutshell, is this: real Gross Domestic Product (GDP) per capita ran at a rate of 2.4 percent per year from 1929 to 1979. But since 2007, real GDP per capita has been a negligible 1 percent. Since the depths of the Wall Street crash in 2009, it has been a paltry 1.4 percent. (GDP per capita is the value of all goods and services produced in a country, divided by the number of people living in the country at the time.)
Jim Clifton adds this perspective in a letter attached to the report to drive home the point that America ‘is dangerously running on empty’:
‘Think of our country as a company, America Inc., which has more than 100 million full-time employees, with about $18 trillion in sales and $20 trillion of debt. The most serious problem facing it is no growth.’

This post was published at Wall Street On Parade on December 16, 2016.