Art Laffer: Millennials forming families will boost economy in 2020

Former Reagan economist Art Laffer discusses the U.S. economy and why household formation is predicted to give an economic boost in 2020 due to millennials forming families.

While it might not seem significant whether you have children, former Reagan economist Art Laffer sees it as a significant indicator of the economy.

Laffer said having a child shows the family is optimistic about the future.

"If we're going into a depression, where there's going to be hardship, people will wait until they have enough, and then they'll have babies," Laffer told FOX Business' Charles Payne on Wednesday. "Once you start getting the boom, and once you start getting the prosperity back the way it should be, you're going to feel fine."

The U.S. birth rate fell 2 percent from 2017 to 2018, according to new data from the Centers for Disease Control and Prevention,

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"It's lovely seeing the U.S. come back."
- Art Laffer, former Reagan economist

When people stop having children, it can mean economic difficulties. Laffer pointed to Japan and parts of Europes, saying when the birth rate declined significantly, the economy followed. Laffer argued Japanese Prime Minister Shinzo Abe isn't doing enough to counteract it.

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"What is Abe doing? Nothing. Tax increases," Laffer said on "Making Money with Charles Payne." "They're going to raise the consumption tax so they can get rid of the last seven babies in the country. It's tragic what they're doing."

Laffer applauded efforts by presidents Trump, Reagan and Clinton, saying they did a great job.

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"If we're going into a depression, where there's going to be hardship, people will wait until they have enough, and then they'll have babies."
- Art Laffer, former Reagan economist

"We're a growth country, and we're going to be really on top of the pack," Laffer said. "It's lovely seeing the U.S. come back."

Laffer said he believes the American economy is thriving and he doesn't "see any end in sight."

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