JPMorgan CEO Jamie Dimon says the US faces 7 major hurdles to economic growth, including high healthcare costs and income inequality

jamie dimon
Jamie Dimon, CEO of JPMorgan Chase

  • Jamie Dimon said the US must address policy problems to ensure economic growth.
  • The JPMorgan CEO said healthcare and education help ensure the US dollar remains strong.
  • Former president Donald Trump fell short on his promise to increase annual GDP growth to 3%.
  • See more stories on Insider’s business page.

JPMorgan Chase chief executive Jamie Dimon called for expanded healthcare and education access in his annual letter to shareholders Wednesday, challenging policymakers to overcome seven major hurdles holding back American prosperity.

Specifically, Dimon said the US government and businesses must work to improve issues ranging from income inequality, economic opportunity and education gaps, healthcare for all, better infrastructure, more affordable housing and increased disaster preparedness to ensure economic growth.

In the letter, Dimon said JPMorgan, the US’ largest bank by assets, had donated funds to improve access to education and healthcare as part of its $200 billion grant for environmental and economic development deals.

“My fervent hope is that America will roll up its sleeves and bring bold leadership to our self-inflicted problems,” Dimon said. “We can be unabashed about the exceptionalism of America while acknowledging that we have problems.”

A lack of affordable and accessible healthcare and education has resulted in 70% of young people being ineligible for military service due to poor reading skills and obesity, Dimon said. The power of the military helps keep the US dollar the strongest in the world, he continued.

Medical expenses will also push the country into further debt over the next two decades, Dimon said, unless the economy grows at a faster pace.

Dimon said the US economy has grown just 18% over the last 10 years, compared to 40% growth in the decade following economic downturns in 1982 and 1990. Had there been more growth, Dimon said, wages would have been higher and the US could have afforded “better social safety nets.”

Read more: Inside JPMorgan’s $30 billion push for racial equity in the economy – and within its own walls

The growth of the country’s gross domestic product – or the country’s economic output – grew at a slower rate under Presidents Barack Obama and Donald Trump compared other recent presidents, though jobs and household income rebounded after the 2008 recession. Trump fell short on his promise to increase annual GDP growth to 3%.

Americans have also experienced stagnant wages for the better part of the the last decade, in part due to the declined power of labor unions and a minimum wage stuck at $7.25 for more than a decade. Income inequality has gotten worse during the pandemic: billionaires made $3.9 trillion as the country as the unemployment rate remains at 6%.

Though Dimon said US income inequality was the “higher than the rest of the world” and one of the country’s largest challenges, he himself took home $31.5 million in 2020.

With regard to other policy challenges, Dimon said he has “little doubt” President Joe Biden’s new infrastructure bill will lead to an economic boom, and has committed part of his $30 billion racial equity pledge to help make housing affordable for Black and Latino people.

“Fixing America’s problems is going to take hard work,” Dimon wrote. “But if we divide them into their component parts, we will find many viable solutions. With thoughtful analysis, commonsense and pragmatism, there is hope.”

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JP Morgan Chase CEO Jamie Dimon defends voting rights following Georgia’s new restrictive voting law

jamie dimon jpmorgan

JP Morgan Chase CEO Jamie Dimon publicly defended voting rights, following Georgia’s new restrictive voting law, the Election Integrity Act of 2021. He was one of the first major business CEOs to speak out after the law was passed last week, according to CNN.

“We regularly encourage our employees to exercise their fundamental right to vote, and we stand against efforts that may prevent them from being able to do so,” the JPMorgan CEO told CNN.

The law requires ID numbers for absentee ballots, limits the use of ballot drop boxes, and bans people from providing food and water to voters in line. The law will likely impact Democratic districts and voters of color.

JP Morgan has more than 250,000 employees globally, and Dimon added, the company’s “employees span the United States and as state capitals debate election laws, we believe voting must be accessible and equitable.”

This story is breaking. Check back for updates.

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Jamie Dimon says ‘gangbuster’ growth is in store for the US but too much fiscal stimulus is a risk

Jamie Dimon 2019
Jamie Dimon, Chairman & CEO of JP Morgan Chase & Co, speaks during the Bloomberg Global Business Forum in New York on September 25, 2019. (Photo by Kena Betancur / AFP) (Photo by KENA BETANCUR/AFP via Getty Images)

  • The US economy is on the verge of a rapid expansion this year and in 2022, said the billionaire head of JPMorgan Chase. 
  • CEO Jamie Dimon said unemployed and small businesses “definitely need help” from US officials to cope with the COVID pandemic. 
  • There is a risk of overheating from too much fiscal stimulus, he said.  
  • Visit the Business section of Insider for more stories.

The world’s largest economy looks to be set for a “gangbuster” pace of expansion through next year but US officials should be cautious about unleashing too much fiscal stimulus into the system, said JPMorgan CEO Jamie Dimon said Monday.

His observations come as a $1.9 trillion economic stimulus proposal headed toward a vote in the US Senate just days after lawmakers in the House of Representatives passed the bill.

A new round of stimulus would follow the $900 billion bipartisan coronavirus relief package signed off by then-President Donald Trump in late December

“There’s a very good chance you’re going to have a gangbuster economy for the rest of this year and easily into 2022,” said Dimon during an interview with Bloomberg TV. “And the question is, ‘does that overheat everything?’ and we just don’t know yet,” he said.

In terms of that risk, Dimon said, “I wouldn’t worry too much about it, but I would suspect there’s a pretty good chance that you’re going to see rates going up and people starting to worry about that at one point.”

Dimon quickly added: “I’ve been very clear: I would not buy 10-year Treasuries, just so you know.”

Before his prediction of strong economic growth for this year and next, Dimon said there are ‘”legitimate complaints” that the current stimulus bill contains items “that have nothing to do with COVID,” but that many Americans do need financial assistance to cope with the pandemic.

“Unemployed, they definitely need help. Small businesses, they definitely need help,” the JPMorgan chief said. 

“I don’t know if you know this but [in] half the states, revenues went up. They didn’t go down. Do they need help? Are we just throwing money at people at one point?”

He urged officials in his remarks to “try not to overdue it too much.”

 

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JPMorgan reveals the latest part of its $30 billion commitment to support Black and brown communities

Jamie Dimon, CEO of JPMorgan Chase, speaks about investing in Detroit during a panel discussion at the Kennedy School of Government at Harvard University in Cambridge, Massachusetts, U.S., April 11, 2018.
JPMorgan CEO Jamie Dimon previously said he is “committed to fighting racism.”

  • JPMorgan is investing hundreds of millions in Black and brown entrepreneurs and small business owners.
  • Brian Lamb, JPMorgan’s head of diversity and inclusion, spoke with Insider about the firm’s plan.
  • Black and brown small businesses have been hit especially hard by the pandemic.
  • Visit the Business section of Insider for more stories.

On Thursday, JPMorgan announced a new wave of investments as part of its $30 billion commitment to lift up Black, Latinx, and other underserved communities. Latinx is a gender-neutral alternative to Latino or Latina to describe people of Latin American descent. 

The plan, which was announced in October of last year, appears to be the largest US corporate commitment to racial equity in the wake of George Floyd’s murder, according to Insider research.

The latest round will focus on Black and brown entrepreneurs and small business owners, according to the financial giant.

“We look at diversity and inclusion as a business,” Brian Lamb, JPMorgan’s global head of diversity and inclusion, told Insider. “We want to drive sustainable change.” 

The firm said it would commit $300 million to support underserved small businesses and an additional $42.5 million to its “Entrepreneurs of Color Fund,” a program that supports Black and brown founders. 

Brian Lamb JPMorgan
Brian Lamb, JPMorgan’s global head of diversity and inclusion, is helping oversee the firm’s implementation of the $30 billion commitment.

The pandemic has devastated small businesses, especially those owned by people of color. 

Black-owned businesses were more than twice as likely as their white counterparts to have closed during the pandemic, according to an August 2020 national study by the New York Fed. Some 41% of Black-owned businesses closed, and 32% of Latinx-owned businesses closed. Meanwhile, white-owned businesses fell by just 17%. 

In addition, JPMorgan will be opening new branches, called “Chase Lounges,” in underserved areas including Harlem, New York, Chicago, and Atlanta. These branches will have resources for entrepreneurs looking to start or grow their companies. 

The news follows JPMorgan’s announcement from earlier this week that it would invest $40 million in minority depository institutions (MDIs) and community development financial institutions (CDFIs). MDIs and CDFIs provide financial services in communities that are often underserved. 

In October, the firm said it would commit $8 billion to help 40,000 Black and Latinx households access mortgages. The firm said it will help an additional 20,000 achieve lower mortgage payments by providing up to $4 billion in refinancing loans over the next five years. 

The mortgage industry is riddled with racism. Lenders deny mortgages for Black applicants at a rate 80% higher than that of white applicants, per 2020 data from the Home Mortgage Disclosure Act.

The firm is also tackling affordable housing. 

Over the next five years, JPMorgan said it will finance 100,000 affordable rental units by providing $14 billion in new loans and equity investments, among other efforts. 

According to the National Low Income Housing Coalition, Black, Hispanic, and Native American households are more likely than white households to be low-income renters, meaning there is a severe lack of affordable homes available to them. 

“We’re going to track and report on our progress towards these commitments and ultimately hold our most senior level leaders accountable to the progress,” Lamb said. 

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