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The Coming Productivity Boom- Transforming the Physical Economy with Information

  • March 28, 2017
  • Michael Mandel
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It is amazing how many of our nation’s biggest challenges can be addressed by a simple formula: faster growth more broadly shared. From infrastructure to healthcare, education to national security, crime to creativity, a bigger pie and a wider winner’s circle go far towards solving them.

A simple comparison of potential growth rates tells the story. At the current expected growth rate of 2% annually, the country will struggle to meet its obligations and invest in the future. But if growth accelerates to 2.7% annually, as this paper’s analysts project, it will add a cumulative $8.6 trillion in wages and salaries over the next 15 years (measured in 2016 dollars).

And while Americans will have more to spend on meeting their needs, the government will have more funding to help out. Federal revenues will go up by an added $3.9 trillion without any increase in federal taxes as a share of GDP. Some of that will go to cutting the debt, while still leaving additional revenue for other needs, such as infrastructure and security. (These figures are based on projections and analysis developed in this paper.)



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