America is now Growing Faster than China
The Atlanta Fed just announced GDP growth is a blistering 5.5%.
Meaning America is currently growing faster than China.
Will Chinese have to teach their kids English?
The Fed took time out from its war on Trump to admit we are in a Reagan level boom even as legacy media keeps pimping the Trump Depression.
It’s not just growth: Unemployment’s down to 4.4%. Wages are up nearly 4% on the year. Even inflation’s down below 2% as the economy grows even faster than Congress can spend it.
Challenger Gray says layoffs are the lowest since 2022.
Services -- which make up 80% of American jobs -- are actually accelerating.
And then the big one: Productivity growth. This is the most important number for economists because it’s literally how we get rich.
And it’s currently running higher than 90% of the time since Reagan took office.
Productivity is the Mother of Prosperity
Productivity measures how much you produce for what you put in -- how much capital, how much workers it takes to make how much stuff. It’s the gold standard for prosperity since the more famous GDP includes a lot of weird stuff.
For example, GDP counts welfare for illegals -- or Somali daycares -- as wealth-generating. It counts riots as wealth since you gotta rebuild. It counts wars, which is why people think blowing stuff up makes you rich.
As Elon famously pointed out, if you fire every autoworker in American and replace them with DMV workers at twice the pay, you raise GDP.
Productivity, in contrast, is actual wealth. And it’s the tightest link to wages since a productive economy has to pay people more or they quit.
Productivity captures technology, skills, and know-how. It also measures how much regulation is hurting growth, which is partly why governments like GDP better -- I mean aside from counting welfare and DMV salaries.
Most important, it’s productivity that predicts future living standards -- will our kids live better than we do.
This is a big reason why the Biden economy looked so good on paper but was so bad in reality.
Over his 4 years Biden’s GDP growth was a solid 3%. But productivity growth was crawling just half that as GDP ballooned with trillions of deficit spending that in some states meant nearly all job growth over 4 years was government-funded.
Trump’s now almost tripled Biden’s productivity.
Concretely, at 4.9% productivity growth it takes just 14 year to double wages. As in your kids would make 4 times what you make.
What’s Next
Last year I predicted strong growth for 2026. So far it’s even better than I expected.
And that’s before we get the millions of jobs coming in from an inflationary Fed and a flood of incoming foreign investment to get inside Trump’s Big Beautiful tariffs.
The last big item on the economic to-do list is affordability. Trump’s throwing the Executive Order kitchen sink at housing, mortgages, healthcare, and food.
But there’s only so much he can do when Congress controls inflationary deficit spending as well as inflationary regulations like energy permitting.
If Congress finally grows a pair Americans will start feeling pretty good about the economy. Maybe even good enough that Republicans keep their jobs in November’s midterm elections.
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