I want to knowledge the people in houston and those suffering from hurricane harvey. I wish them on behalf of the chamber all the safety and swift as possible recovery from what they are dealing with. The economy is in its 9th year of expansion which is fairly notable. That makes of the third longest in the modern era. By next spring, we we will have tied for second. Curiously, despite the length of the recovery and expansion, we seem to be now possibly heading into aperiod of acceleration. Normally as the expansion goes along, the economy slows but we may have something of an acceleration. The reason for that is somewhat in this chart. If you look to the far left side of november, there is that little dip that corresponds to theperiod before the election and then we have the election and surprising many people, the market has taken off since then, so far a 16 increase, often called the trump bump. Whether President Trump gets the credit for this, historians will determine but that increase in the stock market coincides with the election of President Trump. Why might the economy react that way . The reason i think that you could give is that with the election of donald trump, we had the promise now that Hillary Clintons foot would not be replacing a rock obamas foot on the regulatory break. One thing President Trump was able to do at the beginning of the administration is bring a strong stop to the regulatory outpourings that were underway under president obama. Those regulatory outpourings had a distinct Chilling Effect on Economic Growth. We saw in the Second Quarter that the economy accelerated up to 3 . You dont want to make too much out of a single quarter but thats a promising figure. Its a strong and balanced representation of the economy. There is some hope that that will continue for a while. It will not go on indefinitely, however. Ellen blinder, the former fed vice chair recently wrote an article in which he observed that economies and their expansions dont and it just because they get tired. They dont come to a conclusion just because you have run out of string. They end because something happens. Thats what we will see again. Sometimes, its bad lock, a major war or some economic shock in the world that will trigger a recession. Sometimes there is a bubble developing in the economy and it finally pops. We had the. Com bubble at the end of the bill Clinton Administration and it popped and we had a recession. Prior to that, a recession and George H W Bushs term when the real estate bubble popped. Of course, we have a great global recession when the Financial Markets in the housing popped together. As dr. Blinder observed, we dont have those obvious bubbles in the economy. One thing people might point to is that bond prices are extremely early high because Interest Rates are referring early low and continue to be and have been for some time and appeared likely to be for some time. That is an area of concern. Its been going on for some time. One area where we have to be concerned is in bad policy. The most immediate thing we have to worry about right now is the debt limit. The debt limit is coming due sometime at the end of september early october. We dont know exact we went at which point the treasury will not have the resources necessary to pay all the bills. And we will have a technical default at the very least. Nobody knows how terrible the outcome of such an event will be but it will almost certainly be quite terrible. Thats the example of bad policy thats easy to avoid. We just need to raise the debt limit and that was and thats with the chamber has been calling on the congress and the president to do. It will not be easy but it simply has to be done. If we avoid that and similar examples of bad policy, then the economy should continue to do well. We have the opportunity, even at this late date to do things that would make the economy even stronger. Taking the photos the regulatory break is an obvious example of that. We recently had a big victory on that score 8 in the001 ruling which is a perfect example of taking the foot off the regulatory break. Understand that its not just the regulations themselves and their direct cost but its what it does to the psychology of the Business Community as it things about investing Going Forward. That is the overwhelming effect of the Regulatory Environment, what it does to business psychology and investment. Now that the break is off, if that will have an affect, we will see it first in an acceleration in Business Investment. Other areas where policy can make a huge differences in infrastructure bill. We all know infrastructure needs more funding. Its not in a good state. Additional funding for infrastructure for smart projects would make the economy more efficient and thats a make an economy grow more rapidly. Expanding free trade is another area where we can expand economic efficiency and thats how you make an economy grow more rapidly. Right now, the big deal is comprehensive tax reform. This is the one policy area where congress and the president can buy for make the biggest difference in terms of accelerating Economic Growth in the u. S. Economy, comprehensive tax reform built around lower tax rates, expensing for businesses, a more internationally Competitive International tax system. These are the core ingredients and of congress can get those things done, we will have a much stronger economy for a long period of time. No one should think of the failure to do tax reform means of the economy will go long on the same path weve had recently. If we dont have tax reform sometime this year or early next year, a lot of Business Investment that has been predicated on getting tax reform done will have been poorly made. Business investment will likely contract significantly and we will have a significant period of economic weakness, in my opinion. How week we dont know but is not something you want to run. Its not a risk you want to run. This is not just about if youd do it, things are much better. In the long run, they would be. Its also a matter if you dont attack to form done, youre likely to have a much weaker economy in the latter half of 2018 and the immediate future thereafter. This is why the u. S. Chamber president said failure is not an option on tax reform. Turning to the labor markets, we are in the happy position of finally approaching full employment. It should have happened in 2012 or so. We are a few years late but are finally approaching full employment. The unappointed rate has been at 5 or below since 2015, august of 2015. 5 or so is generally regarded as a proximate and full employment. Were not quite at full employment yet. The way you can tell that is in the last year, we had job growth of 2. 2 million jobs or 180,000 per month. When we are at full employment and the labor force is growing with population, we will have closer to 75,0001 is a thousand jobs. That will be assigned a we are at full employment if the economy is otherwise growing is expected and job growth slows to about 100,000 or so honoring the bases, now you will be at full employment so we are not quite there yet. Another sign of the growth of employment the shows significant steady growth, another sign of how tight labor markets are in one respect is that initial unemployment claims are amazingly low right now. They are running about 250,000 25,000 240,000, excuse me, per week. Thats an externally low number and anything below 350400 suggests expansion. Curious things are going on in the American Labor market. Well never spectacular, we have had solid job growth throughout this expansion. Job growth that exceeded what you would otherwise expect given the other elements of expansion in the economy. On the other hand, we have not had much real wage growth. Wages popped up as you can see here look at that gray bark around 2009 when the recession was. Curiously, real wages popped up in the middle of the recession. What was that all about . We had six months of deflation. If you think about real wages, youve got the nominal wages as the numerator and the price level as the denominator and when you have deflation, even if nominal wages are flat, you get a big jump in real wages. After that, they were stagnant. It fell for a bit and was not until about 2013 that they finally started to rise and did not rise rapidly but consistently year after year. What we expect now that we are getting close to full employment is that we will open the last chapter of the labor market story coming out of the great global recession. We are still dealing in effect with the consequences of that recession. First it was the expansion of employment where you are at full employment and it translates from that into faster real wage growth. That is what we should see Going Forward. Faster real wage growth as employers have to bid more for workers, its an interesting thing. We have heard for months, for years in fact, the story from employers that they cannot find the workers they need. We have had workers without jobs and jobs without workers. Heart that was the skills mitch mast mismatch. Employers and workers have to adjust to what employers are working for an employers have to adjust what they can hire to the workforce is available. That has been a factor but another factor has been that employers were not able to find the employees they were looking for at the wages they expected to pay. As labor markets continue to tighten and employers get increasingly desperate for workers, what you will see as employers will have to revise their expectations of what they were going to pay. The workers they are going to be hiring, their wage increases will percolate through the rest of the labor force. That is a reason why think you will see acceleration in real wage growth Going Forward. Thats great for families and great for Household Incomes. It does have consequences for the rest of the economy, however. For one thing, is real wages start to rise significantly, employers will be looking for opportunities to use more capital unless labor, basic economics. One factor production gets more expensive and you look at the other. The other thing the consequence of this is that Household Incomes will maintain strong growth in the aggregate. Even as labor employment growth slows, you will have an acceleration in wages. But those two factors together and you can sustain the growth in Household Income which is great for maintaining personal consumption. You really want those things to Work Together to maintain personal consumption in the economy and keep Economic Growth going. The consequence however is going to be more pressure on business profits. A lot of businesses have been doing very well in this expansion. Some of them have just been eating out profits along the way as they face higher labor they have been ekeing out higher labor costs. One of the odd things that happens when you get to this part of the business cycle, this part of an expansion is you start seeing an increase in business failures because rising wages become more expensive than the employers can bear and you start seeing an increase in business failures. This is actually a sign of health. The workers will have to find new jobs and the labor market will be tight and they should be an to find new jobs but this is another part of the chapter of the story of the expansion coming out of the great global recession. Its the fact that you will get a slowdown in job growth, and acceleration of real wages and of both of those things occur, youll probably see an increase in business failure rate which will surprisingly and perhaps counterintuitively be a sign of economic strength, not weakness. It does not mean we are sliding toward a recession. It means we are starting to move resources to where they can be used most productively which again is another source of Economic Growth. The bottom line is we are very close to full employment finally. The economy is doing quite well. We are benefiting from a synchronized Global Expansion for the first time in many years. Almost all the Major Economic centers in the Global Economy are doing reasonably well. That means they are all supporting one another. We are all stronger if were all stronger. It means or wages should be rising. And what we have to do right now is make sure this continues. If we want to see this increase in real wages that im talking about, we have to keep the rest of the economy going which means avoiding unforced errors and policy like the debt limit and doing what we can do such things like infrastructure, texas reform, and trade and make sure we get the opponent the economy the policy supported me. If we do those things, especially the tax reform, Congress Passes tax reform and gets a bill to the president s desk in my timely basis, sometimes preferably this year, the economy should continue to do very well for a long time. As ellen blinder pointed out, expansions dont and because they get tired. Dont end because they get tired. We have to maker there is good strength and good policy so they the expansion continues for long time. Im looking forward to setting a record for the longest expansion in history, thank you. Its time to take my millions out of my passport savings account. This is a time of year when thats me, randall johnson, the time of year when the management gets to labor day and typically the unions kick it off with comments about employers along the lines of employers are not doing enough for their employees, they are bashing their employees and therefore they need to join the unions and the reason the membership rate is continuing to climb and not go up despite the fact that unions are overly aggressive in union campaigns. As part of my job to take five minutes and set the record straight. Lets take a look at how our employers treated employees and take some of the views of employees. These are numbers are all good news so they rarely get reported. They are all hard data we have picked from straightforward governmental agencies. It tells quite a story so 9. 9 trillion in total compensation, wages and salaries accounted for a chilean dollars. Employers spent approximate 1. 9 trillion in Employee Benefits or 19 of total compensation. I think its worth noting. And health benefits, health care is a huge it gets a lot of attention on capitol hill and the private markets but we lose track of that in the employerbased system. 177. 5 million americans received their Health Insurance employmentbased coverage. That includes state and local governments as some people might say state and local governments in the private sector, we have 150 million americans receiving their employerbased coverage through employers. Retirement benefits we have a retiree crisis in this country. Social Security Problems are coming up and people need to say more but employers are doing their bit on this. Private employers spent 242 point billion debt to under 42 point billion dollars. Eb retirement plans, 42 million participants. 2014, defined conservation plans covered 94. 6 million participants. That includes active participants and retirees. 89 of employees are eligible to participate in what is defined conservation plans but it does not meet its universal coverage but every employee has access to the 401 k plans but thats an impressive figure. Everyone knows about health care and pension benefits but also in the area of Life Insurance benefits. Paid leave or the absence of that gets attention on capitol hill. I think people need to look at the data straight out of the bls. Paid leave is one of the most Common Benefits offered to employees, over three fourths of employees in the private sector including parttime workers, receive paid time off. 91 of all fulltime workers have access to paid vacation days. Is a less generous in Smaller Companies . These people know their employees and try to work on an ad hoc basis to make accommodations for their employees even if they dont have access to paid vacation days. Is a less generous in Smaller Companies . Happen to have a formal policy. Life insurance is offered to over half of employees in private industry. You might say that ok, thats a lot of data that what will employees think . Here is a recent survey. Approximately 49 of American Workers are very satisfied with their current job and another 30 are somewhat satisfied meaning 79 are either very satisfied or somewhat satisfied with their job. Most people feel secure in their job. 80 are either not likely are not too likely to think they will lose their jobs. Thats from october 6, 2016. Even better, august, 2017, a gallup poll shows 95 percent of adults employed full or parttime are totally satisfied with the physical safety conditions of the workforce. 95 of coworkers and 95 with the flex ability of the hours. These statistics only tell part of the story but i think the surveys are very important for you to be aware of when you hear contrary stories from those who paint a dire picture of the workforce. Why are Union Memberships always in decline . Eight years of the Obama Administration running the nlrb. One of the reasons is Union Benefits and a provided by federal or state statutes. Thats true. Another reason is there still remains a problem of union corruption. Sometimes you are on the road and you cannot swing a cat without running into so