President Trump is sad nobody else knows what "priming the pump" means.
For the record, Donald Trump did not invent the phrase "priming the pump" in an economic context, or really any context.
In an interview with the The Economist published Thursday, the President was asked about his tax plan's potential to increase the deficit. "We want a provision at the right time, we want people that are coming in and will commit to not getting not receiving any form of subsidy to live in our country for at least a five-year period", Trump said in an apparent hint at the forthcoming policy. In other words: Spend money to make a lot more money in the future. The government would run higher deficits to fund the tax cuts, but they would generate faster growth that would at some point reduce the size of the deficits. Ryan and his GOP colleagues have proposed ending that break. You could do anything. even become the President of the United States.
Trump asked the magazine's editors if they understood what he meant by "we have to prime the pump".
"We're also going to prime the pump", he said.
Economists are skeptical of this reasoning. Today, though, the unemployment rate is just 4.4 percent, and additional federal borrowing risks burdening the economy by increasing the national debt.
Hate to break it to you, Trump, but "prime the pump" has actually been around for decades. Morgan Stanley has estimated that big firms have stockpiled about $2.5 trillion overseas to avoid paying US taxes, about $1 trillion of it in cash and the rest in other assets and securities, Bloomberg reported.
"A burst of government spending or a burst of tax cutting can start there being more spending, which leads to more income, and the economy starts revving up", said Larry Summers, who teaches economics at Harvard.
The White House press office did not respond to an email seeking clarification on Mr Trump's comments. At the time, officials declined to clarify. "Nobody cares about my tax return except for the reporters", he said. "I like a Value-Added Tax".
Still, Trump believes the goal is realistic, saying during that interview that "I happen to think that 3 percent is low". But I would never consider it as part of a deal.
- Artyom (@ArtyomTonoyan) May 11, 2017So I told these guys "say cheese" for this photo. In the long run, we are all dead.