Three percent GDP growth. Three percent GDP growth. Three percent GDP growth.

Get it stamped on your brain. Get it tattooed somewhere. Have some T-shirts made, because this is team Trump’s goal for the economy. In a time of extreme policy confusion, 3% GDP growth is one of the only firm targets we have to hang onto.

The problem is that in interview after interview, Donald Trump and his surrogates have demonstrated that they have no idea how to get there.

Take, for example, Commerce Secretary Wilbur Ross’ confirmation hearing. He told senators that a combination of tax reform, a more self-sufficient energy policy, and increasing exports would do the trick.

“Combine those and get a fraction of a percent of growth from each, and we’ll see the numbers we’re talking about,” he said.

Chief White House Economic Adviser Gary Cohn has also talked about the magic path to 3% GDP growth, mostly saying that tax reform and deregulation would get us there. Treasury Secretary Steven Mnuchin said the target was “very achievable” and spouted the same lines.

Lees ook op Business Insider RIVM-baas Van Dissel: coronagolf komt door ons eigen gedrag – werkgevers doen oproep om tweede lockdown te voorkomen

Unfortunately, that’s not how GDP growth works.

The way things are

GDP growth is a function of how many workers enter the workforce and how productive those workers are. It has nothing to do with energy consumption or how much we export – unless that manages to bring in more workers.

“The problem for the Trumpians is that we’ve had eight years of recovery,” Lee Branstetter, a professor of economics at Carnegie Mellon University, told Business Insider. “Now unemployment is well below 5%, and there’s just not a lot of slack in the US labor market. … It’s essentially mathematically impossible to get the growth they’re talking about.”

Branstetter is talking about challenges completely beyond the government’s control, like demographics. Baby boomers are getting older and leaving the workforce, and the generation set to take their place, Generation X, is not as big. And immigration has slowed, which is another impediment to adding workers.

You see, workers don’t just take jobs; they buy things. They pick up breakfast on the way to work. They buy sneakers for their kids. They fill their gas tanks. That’s what the US’s consumption-based economy runs on.

As for productivity growth, a lot of that is a function of technological advancement. The last time American workers actually got a raise – as in, normal people saw some wage growth – was from 1998 to 2000, during the height of the internet boom changing the economy. Other than that, American workers haven’t seen their wages increase in about 40 years.

Guys, it’s not the ’80s. Sorry.

You may be wondering where Trump and company got the idea that deregulation, tax cuts, energy policy, and the like can juice GDP growth.

Blame former President Ronald Reagan.

A lot of Trump’s ideas – like increasing the defense budget, cutting taxes, and slashing budgets for tiny programs – come from the Reagan playbook.

GDP growth was stronger during his presidency, but it wasn’t because of those policies. Again, it was a function of demographics. Reagan, more like Obama, took office during a deep recession, when there was plenty of slack in the labor market.

“Back in the ’80s, baby boomers were coming into the labor force, and many women were entering the workforce for the first time, too,” Branstetter said. “That resulted in the workforce increasing by 1.7%, and because of technological advancement, productivity growth was running at about 1.7% as well.”

That’s where you get your 3% GDP growth number.

Tax cuts and deregulation would help only if they spurred people to hire more workers, but they also could hurt. Deregulation was a big factor in our last financial crisis, for example.

And as for tax cuts, according to the Center on Budget and Policy Priorities, states that enacted big tax cuts haven’t seen strong job growth. The evidence that they help with jobs just hasn’t materialized.

Foto: source CBPP

What we do know, though, is that Trump’s policies would likely slow immigration, meaning fewer workers. We also know that his tax plan may include a controversial border-adjustment tax on imports that could violate World Trade Organization rules. That means angry trading partners, which means fewer exports sold and possibly retaliation.

The point is that this reform-and-deregulation package has its upsides, but it has major downsides, too. That’s probably why the White House’s messaging about what would and wouldn’t be included has been so mixed and confusing.

Lost in this debate is the idea that we could make our workforce more productive through investment in education and retraining. That’s a longer process, and it costs money the GOP doesn’t want to spend, but it would ultimately create more lasting gains.

What’s more: The American people actually want it. Go figure.

For more on the unintended consequences of Trump’s policies, listen to Business Insider’s Linette Lopez and Josh Barro on their podcast, “Hard Pass.”