White House says U.S. could reach 3 percent growth rate

WASHINGTON -- The White House's top economist said Wednesday the U.S. could achieve annual growth rates of 3 percent through the next decade if President Trump's policies on regulations and infrastructure are enacted.

The Council of Economic Advisers (CEA) released its annual economic report, which praises the effects of the tax cuts and tax overhaul signed into law by Trump last December. The report forecasts an overall average annual growth rate of 2.2 percent through 2028.

But with the "full implementation of the Administration's agenda," including the implementation of the tax law, additional cuts to regulation and a sweeping infrastructure plan, the projected growth rate reaches 3 percent through the next decade, said the report.

"We have high confidence that our policies will return growth levels to normal and really the headline of our growth chapter is really there's not a new normal to look ahead to, there's just normal," Kevin Hassett, chairman of the CEA, said on a call with reporters Wednesday. "And that normal is happening because we've restored economic policies to where a sensible, rational policy would put them"

The economic projections are more subdued than the bold predictions made by the president in recent months. Trump suggested in December he saw "no reason why we don't go to 4 percent, 5 percent, and even 6 percent."

The report says Trump's "pro-growth policy agenda," including the tax cuts and efforts to cut regulations, "have inspired enormous confidence in the economy and optimism that it will continue thriving."

It argues that the economy was stagnant under Trump's predecessor, former President Barack Obama, but the president's first-year policies have rejuvenated the economy's long-term outlook. Many economists, however, have said Trump inherited a sturdy U.S. economy at the end of Obama's presidency, which started during the economic upheaval of the nation's recession.

The report repeats the administration's estimate that the tax bill is expected to raise the average American's household income by more than $4,000. Most mainstream economists and Democrats have expressed skepticism about those projections. An estimate by the nonpartisan Tax Policy Center estimated the average household income would rise more than $1,600 in 2018 because of the tax cuts.