The economy withers

I learned today something that is truly disquieting. Martin Feldstein, former chairman of the president's council of economic advisers under Reagan, pointed out in a piece in the Wall Street Journal that of the 1.8% rate of growth in the first quarter, two thirds consisted of inventory build up and one third of actual growth. In other words, aside from businesses adding to inventory, the growth rate for the first quarter was 0.6%, or put another way, the rate for the quarter alone was 0.15%. This is just a rounding error away from being a decline. Particularly given the increases in unemployment in April and May, the energy price rises during that same time, and the decline in the leading indicators that also hit for the first time since the recession ended, we may well be seeing a contraction of the GDP during the second quarter. That's right, the "bump in the road" that does not concern president Obama may actually be the start of another recession.

All of this makes it more important than ever that the USA get some competent leadership on economic matters. We need someone with an understanding of how the economy works, a knowledge base that Obama seems to lack. We need someone who understands the impact of policy changes on the economy. We need someone who has the imagination to move beyond things that have been tried and which failed. We need someone who recognizes the dire situation in which the country finds itself. We need someone who actually cares about those who are unemployed as people and not just as statistics to mention to show how well (or how poorly) the economy is performing. Simply put, we need someone other than Obama.