The CEO of JP Morgan Chase, Jamie Dimon, is out with his 2018 annual letter covering the company's performance in 2017. I find this letter to be an interesting read pretty much every year. Some passages follow that I thought were particularly worth highlighting.
Mr. Dimon is fairly positive about some developments from the Trump administration and the Republican Congress, and the effects they will have on the American economy:
The United States in particular may be strengthening as we speak. The competitive tax system, a more constructive regulatory environment, and very high consumer and business confidence are increasing indications that the economy will likely expand.
He says that the American economy has fallen short of its growth potential.
our economic growth has been anemic. Our economy has grown approximately 20% in the last eight years, but this stands in contrast with prior average recoveries where growth would have been more than 40% over an eight-year period.
Part of the problem is excessive regulation: "It took eight years to get a man to the moon (from idea inception to completion), yet it now can sometimes take a decade to simply get the permits to build a bridge or a new solar field."
Another problem is health care and costly entitlement programs:
The creation of Obamacare, while a step in the right moral direction, was not well done. America has 290 million people who have insurance – 180 million through private enterprise and 110 million through Medicare and Medicaid. Obamacare slightly expanded both and created exchanges that insure 10 million people. But it did very little to fix our broken healthcare system and has, in fact, torn up the body politic over 10 years – and this tumult may go on for another 10 years....
The extraordinary growth of Medicare, Medicaid and Social Security is jeopardizing our fiscal situation. ...The core issue underpinning the entitlements problem is healthcare in the United States.
Where Mr. Dimon is coming from can be sensed from this sentence, which made me chuckle: "I tell my liberal friends to read columnists like Arthur Brooks and George Will. And I tell my conservative friends to read writers like Tom Friedman." I agree that Tom Friedman is on the liberal side of things, but most liberals would probably see him as a centrist mouthpiece for big business. What's apparently meant as a demonstration of openness to a wide variety of points of view winds up actually encompassing a pretty narrow band. That's not a complaint from me, just a comment. I think Mr. Dimon's been, overall, a pretty constructive policy voice, and I'm glad that he speaks out on these broader issues rather than focusing narrowly or exclusively on the bank's business results.
