U.S. Secretary of Commerce Wilbur Ross issued the following statement today on the release of the real gross domestic product (GDP) quarterly growth by the Department of Commerce. In the first quarter of 2017, the GDP increased 0.7 percent, according to the advance estimate released. Since the first quarter of 2016, the year-over-year increase in real GDP was 1.9 percent. The increase in real GDP reflected increases in business investment, exports, housing investment, and consumer spending.
“We need the President’s tax plan, regulatory relief, trade renegotiations and the unleashing of American energy sector to overcome the dismal economy inherited by the Trump Administration,” said Secretary Ross. “Business and consumer sentiment is strong, but both must be released from the regulatory and tax shackles constraining economic growth.”
The increase in business investment reflected growths in both structures and equipment, notably a significant surge in mining exploration, shafts, and wells. The increase in exports reflected an increase in nondurable industrial supplies and materials.
During the first quarter of 2017, overall mining exploration shafts and wells accounted for 0.54 of the .7 increase in GDP. This was driven by a 449 percent increase in private fixed investment since the fourth quarter of 2016. The percent change from quarter to quarter within this sector is the greatest ever recorded, the next closest occurred in the fourth quarter of 1981, when the percent change was 192 percent. The growth rate for total footage drilled from the fourth quarter of 2016 to the first of 2017 was 533 percent. Administration action, including approval of the Keystone and Dakota Access pipelines.
Just today, President Trump signed an executive order which will allow the review of the Continental Shelf for offshore oil and gas exploration as well as review the regulations and permitting process for development and seismic research. Currently 94% of these off-shore areas are closed for exploration and production which deprives our country of potentially thousands of jobs and billions in wealth.
Other Administrative accomplishments have begun to loosen the burdensome regulations which have handicapped American businesses. It is estimated that President Trump’s pro-growth actions, including signing into law 13 Congressional Review Acts removing harmful Obama-era regulations, could generate more than $18 billion in annual regulatory savings for businesses, investors, and consumers. American corporations and workers have reaped the rewards of these policies; since President Trump was inaugurated several companies announced additional domestic investments including Charter Communications’ $25 billion investment which would lead to jobs for 20,000 American workers in the next four years, and Exxon Mobil Corporation $20 billion’s investment that would create more than 45,000 jobs.
The increase in consumer spending reflected an escalation in spending on services that was offset by a decrease in motor vehicle purchases. Private inventory investment, federal government spending, and state and local government spending subtracted from growth.
Prices of goods and services purchased by U.S. residents increased 2.6 percent in the first quarter of 2017. Excluding food and energy, prices increased 2.3 percent in the first quarter of 2017.