Which old recession?
Bush’s recession (“which I inherited”)!
The U.S. economy grew at a 3.5% annual rate in the third quarter, ending a string of declines over four quarters that resulted in the most severe slide since the Great Depression. But some economists raised doubts about how long such strong growth can last.
The increase in GDP, reported by the government Thursday morning, was slightly better than expectations. Economists surveyed by Briefing.com had forecast 3.2% growth in gross domestic product, the broadest measure of the nation’s economic activity. The economy shrank at a 0.7% rate in the second quarter.
The positive GDP report is one more sign that the economy has likely pulled out of the deep recession that started in December 2007.
The reading by itself doesn’t mark an end to the recession; the economy actually grew in the second quarter of 2008. (The National Bureau of Economic Research, which officially dates the beginning and end of recessions, is not expected to declare that the current recession has ended until sometime in 2010.)
That’s rather uncharitable toward President Obama. I thought a recession was a definable term—it was declared after two consecutive terms of “negative” economic growth (aka shrinkage, though the term has other connotations). Wouldn’t a quarter of growth—better than expected growth—automatically define the end of the recession?
I think so.
Because I want the next recession to belong to Obama all by hisself.
This, ahem, “recovery” reminds me of what I heard an engineer say about a particular airline design (747?): if you throw it hard enough, anything will fly.
Cash for Clunkers, credit for first-time home buyers (as young as four!)—these programs did indeed inject much needed fuel into the economic engine.
But they forgot to fill the tank. They did nothing to restore the free market, they merely replaced it.
And left it worse off then before:
The Obama administration on Thursday lashed out at a prominent critic of its Cash for Clunkers program, arguing that the popular trade-in initiative helped give the auto industry and the economy a much needed boost in the past few months.
On Wednesday, Edmunds.com released a study that argued Cash for Clunkers did not have a great impact on the auto industry. The report said that 690,000 new vehicles were sold under the program last summer, but that only 125,000 of them would not have been sold without the Clunkers rebates.
As a result, the report said, the administration’s economic claims for the program “have been rendered quite weak.”
The Edmunds report also said that taxpayers shelled out an average of $24,000 per car sold as a result of the program.
But the White House fired back, saying Thursday’s Commerce Department report that showed auto sales contributed 1.7 percentage points to the economy’s 3.5% growth rate in the third quarter is proof that Cash for Clunkers had a meaningful impact on both auto sales and the broad economy.
My point exactly. Which is why they’re so pissed someone’s questioning the value of the program.
And why this news—which never changes, so it’s hardly news—is more telling:
The number of Americans filing for initial unemployment insurance were little changed last week, the government said Thursday, with a total figure that missed analysts’ expectations.
There were 530,000 initial job claims filed in the week ended Oct. 24, down 1,000 from an unrevised 531,000 the previous week, the Labor Department said in a weekly report.
The government said 5,797,000 people filed continuing claims in the week ended Oct. 17, the most recent data available. The number was down 148,000 from the preceding week’s revised 5,945,000 claims, and marked the second time since late March that continuing claims fell below 6 million.
But the slide may signal that more filers are dropping off those rolls into extended benefits.
Continuing claims reflect people filing each week after their initial claim until the end of their standard benefits, which usually last 26 weeks. The figures do not include those who have moved to state or federal extensions, or people whose benefits have expired.
One could go on and on. I just hope Obama enjoys economic news while it lasts. The rest of us are still waiting for some.
And as for that other claim:
The Obama administration’s $787 billion stimulus bill directly saved or created about 650,000 jobs as of the end of last month, administration officials announced this morning.
Factoring jobs indirectly created from the stimulus — not reflected in these numbers — an administration official says in a statement that “because these reports show that less than half of the spending through that date created or saved about 650,000 jobs, they confirm government and private forecaster’s estimates that overall Recovery Act spending has created and saved at least 1 million jobs.”
The “majority of funds” came from state governments because Porkulus distributed the money in block grants to the states. What did the states do with that money? They did save jobs, but primarily bureaucratic jobs. States used the money to temporarily paper over budget gaps which would have forced the layoffs of state employees, which should have been a necessary step in slimming down state-level spending.
The administration will claim that it saved the jobs of teachers, police officers, and firefighters with the data submitted by the states. Indeed, we have already seen this in New Hampshire, which listed almost all of its “saved or created” jobs from their education system.
No one was going to have a mass layoff of police officers and teachers in New Hampshire or anywhere else. The jobs really at risk were administrative jobs within state government, primarily union jobs (in large part represented by Obama’s ally, the SEIU), as states had to confront an economic reality of lower revenue and rising spending.
They’ve created nothing. And the bacon they saved won’t stay good for long.