Mark Zandi: Why Trump Is Wrong And We Need Immigrants by Robert Huebscher
Immigration policy divides Hillary Clinton and Donald Trump. U.S. growth will falter unless the measures proposed by Clinton are adopted to spur increased immigration, according to Mark Zandi. Trump’s policies, Zandi contends, will put the U.S. on a trajectory similar to Japan’s “lost decade.”
Zandi is chief economist of Moody’s Analytics, where he directs economic research. He is co-founder of Economy.com, which was acquired by Moody’s Analytics in 2005. Zandi often testifies before Congress on the costs and benefits of proposed policy measures. He has been at the center of a controversy in the current election cycle, with both presidential candidates claiming his analysis supports their views.
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He spoke on-the-record at a private event in Boston on October 6.
“No single policy matters more to lift U.S. growth on a sustained basis than immigration reform,” Zandi said. “It is vitally important to our economic future. If we don’t get this right, we won’t get 4% growth; we will get 1%.”
“We will get Japan,” he said.
Zandi also predicted that Clinton will win the presidential election, but he did not endorse either candidate.
I’ll discuss Zandi’s positive outlook for the U.S. economy and the risks it faces and provide some final thoughts on what Zandi said about immigration.
A positive outlook for U.S. growth
“The economic prospects are good for the next two to three years,” Zandi said. There is a high probability the current economic expansion, which is already seven years old, will be the longest on record, according to Zandi. It is now the third longest expansion.
Zandi’s positive outlook is driven largely by the labor market. He said that data for the labor market is more accurate than GDP, which is tough to measure. The data for the labor market is very good, he said, and job growth is double the pace needed to keep up with the growth of population.
“We are months away from full employment,” he said, although that is not true in the energy and trade-sensitive manufacturing sectors.
Indeed, he said, “cheap money has worked.” Zandi said monetary policy is at least partially responsible for the fact that GDP growth excluding government spending has been almost 3% annually for the last seven years. Growth in the government sector has been slower due to fiscal austerity measures, he said.