The MAGA Movement We Need: Make America Grow Again

America desperately needs a bipartisan MAGA movement. No, I’m not referring to Former President Trump’s Make America Great Again; I mean “Make America Grow Again.”

How can I say that? Don’t we already have growth, and don’t most policymakers in Washington, DC, want more? Sadly, the answers are no and no. And until the latter changes, and Washington embraces growth MAGA, the policies we need to accelerate growth will be stillborn, and we’ll continue to suffer from anemic income growth.

First, let’s be clear. To paraphrase Richard Nixon, we are all still Keynesians now, in the sense that when experts, pundits, and elected officials speak of growth, they are almost always referring to more jobs—either more job creation (“small business creates jobs,” “green energy creates jobs,” “tax cuts create jobs,” etc.), or more workers (immigration adds to the workforce).

But the economy today is at full employment. Efforts to create more jobs just spur inflation. If we were to need jobs because of a recession, that would be the time to focus on job creation. What about more immigration? Of course, more workers would boost GDP, but it would no nothing to boost per-capita GDP—in fact, there is evidence that low-skill immigrants lower per-capita GDP.

So, it’s time to agree that when we talk about growth, we are talking about boosting Americans’ living standards: higher GDP per capita. And that is desperately needed. In 2024, median household income was just $78,000, with average income per consumer unit estimated to be $97,000. Given the current prices of housing, medical care, food, gas, electricity, higher education, and taxes, $78,000 for a family of three is pretty damn meager. And unfortunately, median household income has increased just 1.27 percent a year in the last 10 years.

As such, it’s time to set a bipartisan goal to raise median household income above $100,000 in 10 years, which requires boosting growth from 1.27 percent to 2.20 percent per year.

That will require a sea change in thinking, because growth—real growth, not job growth or population growth—is not really on the table in Washington. Few economists actually care about it. In conventional economic theory, the rate of growth is fixed, dependent on the supply of capital, and there is nothing policy can do to exceed that natural rate. Noted economist Alan Blinder summed up the conventional view when he wrote:

Although economics can tell the government much about how to influence aggregate demand, they can tell it precious little about how to influence aggregate supply. . . . Nothing—repeat, nothing—that economists know about growth gives us a recipe for adding a percentage point or more to the nation’s growth rate on a sustained basis. Much as we might wish otherwise, it just isn’t so.”

But what about free-market conservatives; surely, they must want growth. They do. The problem is that their version of growth policy is to do nothing but reduce the role of government in the economy, then let markets and entrepreneurs work their magic, and voilà, growth will flourish. If only it were that simple. The reality is that there are massive market failures that limit growth. To mention just one, there are big externalities from investing in research and development, machinery and equipment, and skill development. So, businesses will underinvest in them absent government intervention. So, as long as free market conservatives stand in the way by rejecting the role of government in supporting growth, growth will be enfeebled.

What about liberals and progressives? Unfortunately, progressives have never supported growth, favoring redistribution instead, and most liberals have now turned away from growth, either rejecting it outright as harmful to the environment, or arguing that it no longer helps the working class. Case in point: liberal groups like the Center for Equitable Growth. It won’t complain about slow growth; but it fights for equity. The reality is that most liberals and even moderates are now in the equity camp alongside progressives, focusing only on policies that redistribute wealth (e.g., college tuition waivers, free daycare, drug price controls, breaking up big companies, etc.). Then there are the more extreme de-growthers, who see growth as a plague on the planet that must be reversed.

Troublingly, the new “national conservatives” also have abandoned growth, seeking to make the Republican Party the working-class party. National conservative groups like American Compass advance erroneous views that the middle class has eroded and that productivity no longer benefits working people, and so it too puts redistribution first.

Yes, it’s heretical to not sing the praises of blue-collar workers. But the reality is that Making America Great Again means Making America Grow Again, and that means prioritizing a vastly larger GDP relative to the population, because it will help Americans of all collars.

America didn’t used to be this way. Until the late 1960s, support for growth—the “rising tide that lifts all boats,” as John F. Kennedy called it—was a national religion. Today, that view is mocked. Until most of the political class can once again agree to put growth first, we will not get the economic policies American families so desparately need.