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Shocker: 1st Qtr GDP Gets Revised Down

From an unfazed Associated Press:

Economic rebound slowed last quarter

By JEANNINE AVERSA (AP) – May 27, 2010

WASHINGTON — The economic rebound last quarter turned out to be slower than first thought, one of the reasons unemployment is likely to stay high this year.

The economy grew at a 3 percent annual rate from January to March, the Commerce Department said Thursday. That was slightly weaker than an initial estimate of 3.2 percent a month ago. The new reading, based on more complete information, also fell short of economists’ forecast for stronger growth of 3.4 percent.

Imagine, the economic experts were wrong again. Still, why do their predictions for Mr. Obama’s economy always seem to err on the ‘rosy’ side? We don’t recall that being the case during the Bush administration.

The reasons for the small downgrade: consumers spent less than first estimated. Same goes for business spending on equipment and software. And, the nation’s trade deficit was a bigger drag on economic activity

During normal times, growth in the 3 percent range would be considered healthy.

Except under Republican administrations, when growth in the 3 percent rage was called a ‘recession.’

But the country is coming out the longest and deepest recession since the Great Depression. So economic growth needs to be a lot stronger — two or three times the current pace — to make a big dent in the nation’s 9.9 percent unemployment rate.

We realizes it is probably our imagination, but sometimes it almost sounds like the AP is making excuses for the Obama administration’s economy.

Economists say it takes about 3 percent growth to create enough jobs just to keep up with the population increase.

Really? Last we heard the ‘natural’ population rate growth of the US was only 0.6%. Does this 3% figure include illegal aliens undocumented workers?

Growth would have to be about 5 percent for a full year just to drive the unemployment rate down 1 percentage point.

After the last severe recession in the early 1980s, GDP grew at rates of 7 to 9 percent for five straight quarters and the unemployment rate dropped from 10.8 to 7.2 percent in 18 months.

Of course, the AP does not hazard a guess as to what might have caused such a phenomenon. In fact it was caused, lest we forget, by massive tax cuts.

Indeed, tax cuts have worked every time they have been tried.

Economists don’t see that happening this year. In fact, growth in the first quarter was slower than at the end of last year

Gee, then maybe increasing government spending and taxes isn’t the answer.

Christina Romer, head of the White House Council of Economic Advisers, said in Paris Thursday that it would be a mistake for the U.S. to rapidly wind down fiscal stimulus measures to bring down the deficit.

Additional measures such as fiscal relief for state and local governments and extension of emergency benefits for the long-term unemployed are still needed, she said. Those are ways to inject more oxygen into the "nascent economic recovery," she said.

Whoops. Apparently, we were wrong.

More spending and higher taxes must be the solution, after all.

This article was posted by Steve on Thursday, May 27th, 2010. Comments are currently closed.

5 Responses to “Shocker: 1st Qtr GDP Gets Revised Down”

  1. JohnMG says:

    Unexpectedly! They forgot unexpectedly!

    idiot; n. A mentally deficient person; an extremely foolish or stupid person. idiot(s); (pl)

  2. Chinnubie says:

    I want to live in a world where the MSM just goes out and reports the information regardless of who is sitting in the White House. I mean I understand to make it sound good you have to write some opinion but, geez they make it so patently clear whos side their on. I had a professor with a Phd in Media Communications and she swore up & down there was no bias in the main stream press and I’m still looking for a job??

    • proreason says:

      “I had a professor with a Phd in Media Communications ”

      For anybody with a Phd who is a professor, there is a 95% chance of that person being a doctrinaire liberal, and probably an undeclared communist.

      To get the degree and become a professor, they had to suck up to dozens of communists and listen to years of propagana.

      By nature, the vast majority of academics can’t resist it. They are weaklings, egomaniacs and sheep.

      If you were attacked in an alley, the last person in the world you would want by your side would be a professor.

    • Right of the People says:

      Like they say, them that can do, them that can’t teach.

      I can’t imagine a more worthless degree than a Phd in Media Communications. Well maybe one in English Literature or Philosophy, heck any liberal arts degree for that matter.

      As far as I can see the need for liberal arts degrees is nil. We already have more than enough and anybody who spent their hard earned money chasing a worthless degree with just about zero employment prospects is the worst kind of fool. McDonalds and other places like it are full of people with degrees in Women’s Studies or Basketweaving. They should include a mandatory class in the syllabus for these majors so those pursuing them can learn helpful phrases like:

      “Do you want fries with that?”
      “Would you like to super size your order?”
      “Thats $26.50 for the gas.”
      “Welcome to Walmart!”

      All designed to assist the recent liberal arts graduate in finding gainful employment.

    • proreason says:

      Or the best possible phrase to get a job and direct pipeline to limitless gubamint benefits:

      “No hablo inglés”

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