With unemployment very low at 4.7%, substantial fiscal stimulus will simply drive up wages and inflation, forcing the Fed to increase rates prematurely. Thus, Trump and Congress should focus on expanding the economy’s productive capacity, not increasing household consumption. This means boosting labor productivity by encouraging corporate investment in plant and equipment, increasing R&D spending, boosting job training, improving K-12 education, focused infrastructure spending, and more efficient regulation.

Elliot F. Eisenberg,

Ph.D. GraphsandLaughs, LLC