Remember when they told us that Trump’s immigration policies and tariffs would hurt U.S. growth? Well, that’s not quite how things are working out. The International Monetary Fund, which everyone refuses to call EH-MM-FF no matter how much we try to make that happen, released its updated projections for economic growth around the world. Our friends over in Europe are expected to grow by just 0.9 percent this year and 1.2 percent next year. France is seen as clocking in just 0.6 percent growth this year and 0.9 percent next year. Germany’s growth gets a 0.7 percent 2026 forecast and a 1.0 percent 2027 forecast.
The United States? The IMF says we’ll likely grow 2.3 percent this year and 2.2 percent next year. In other words, we’re lapping the Europeans. All their talk about international rules-based blah blah blah and openness to yadda-yadda-yadda puts them behind Trumpian Make America Great Again economics. Why? One reason is our energy production. While higher energy prices are basically a net drain on Europe’s economy, they tend to boost the U.S. economy over time because we are major energy exporters. Another reason is our leadership in technology investment, especially artificial intelligence.
Sluggish growth is a policy choice. Or, rather, the result of weird policy choices. Europe could produce vastly more energy than it does, but it prefers climate change pieties and imported energy (although natural gas extracted from the middle of America emits just as much carbon as gas extracted from Europe would). The AI thing is even weirder. The U.S. economy is expected to outperform because it is “closely integrated into the global technology value chain.” Europe lags because its dominant regulatory and cultural regimes resist innovation. And, also, because domestic energy production makes it easier to excel at technology and more resilient to supply shocks.
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