The US economy has been growing at 2.1 percent per year between mid-2009 and mid-2014.
Robert Gordon of Northwester University has developed a new and surprisingly simple method of calculating the growth rate of potential GDP over the next decade and concludes that projections of potential output growth for the same decade in the most recent reports of the Congressional Budget Office (CBO) are much too optimistic. If the projections in this paper are close to the mark, the level of potential GDP in 2024 will be almost 10 percent below the CBO’s current forecast. Further, the new potential GDP series implies that the debt/GDP ratio in 2024 will be closer to 87 percent than the CBO’s current forecast of 78 percent.
Seeking Alpha has the CBO and Robert Gordon Projections in a chart.
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