The Trump Boom Comes Into Sharper Relief

The outlines of a Trump Boom are emerging in sharper relief with the Atlanta Fed’s estimate of 5.1 percent growth in America’s gross domestic product in the fourth quarter of 2025. Such growth hasn’t been seen since the post-pandemic recovery — and before that, toward the end of the Clinton years. Expansion exceeding 5 percent would echo, too, the Reagan Boom that started in 1983, not to mention the high-growth years of the 1950s and 1960s.The Atlanta Fed’s GDPNow projection represents a near-doubling in the anticipated pace of growth from the model’s own earlier estimate of 2.7 percent in the fourth quarter. The numbers from the Peach State prognosticators are noteworthy in part because for the third quarter of 2025, GDPNow accurately anticipated accelerating growth. While consensus estimates foresaw but a 1.3 percent expansion, the Atlanta Fed estimated 3.5 percent growth.In the event, the 4.3 percent growth in the third-quarter reported in late December by the Commerce Department in its initial release surpassed even the GDPNow projection. Could the GDPNow estimate for the fourth quarter be outpaced again by the data? The Atlanta Fed says that its model’s projections are derived from the “available economic data for the current measured quarter,” with “no subjective adjustments.”Our columnist Larry Kudlow, reading the same economic tea leaves, is touting the possibility of “a Trump economic boom” that “could deliver 5 percent, 6 percent, or even 7 percent growth.” Great expectations like Mr. Kudlow’s are increasingly plausible after the unexpectedly high rate of growth in the fourth quarter. The data seemed, in these columns’ appraisal, “to offer a vindication of President Trump’s economic policies — with some caveats.” That assessment holds as eyes pivot to the economic prospects for 2026 and the runup to the midterms. Feature, say, the employment data released today by the Bureau of Labor Statistics. Some 50,000 jobs were added in December, slightly below the level anticipated by economists. The unemployment rate fell to 4.4 percent. For 2025 as a whole, 584,000 jobs were created, “the slowest annual growth in a non-recession year since 2003,” Politico cautions. By contrast, some 2 million jobs were added in the last full year of the Biden presidency. It’s disappointing, too, that December saw manufacturing employment fall by some 8,000 jobs. That was the eighth month of falling job numbers in the sector, despite Mr. Trump’s pledge to launch what Reuters calls a “blue-collar jobs boom” and a wave of tariffs purportedly designed to bolster America’s manufacturing sector. Employment has fallen, too, in mining and logging since Mr. Trump’s “Liberation Day” tariffs, per Reuters. Yet in an economy as large as America’s, it’s early yet to determine whether Mr. Trump’s attempt to reset the terms of global trade will yield the outcomes envisioned by the president. The Supreme Court’s anticipated ruling on the legality of the tariffs could yet upend Mr. Trump’s agenda — or confirm the use of tariffs as an instrument of policy.The prospect of 5 percent growth could, one imagines, give the justices pause as they weigh the president’s power to set the levies. Quarterly growth in excess of 5 percent used to be par for the course for America’s economy, at least until America jettisoned honest money by abrogating the Bretton Woods system. Economists in recent years have become resigned to “secular stagnation” and slow growth. Mr. Trump’s economic boom is changing that calculus.

The Trump Boom Comes Into Sharper Relief

The Trump Boom Comes Into Sharper Relief

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