The BEA released its first estimate of the Gross Domestic Product for the first quarter of 2013 today. Growth was pegged at 2.5%, a poor number. Nearly half the increase was due to restocking of inventory, so without the impact of the inventory, the growth rate was below 1.5%. During the last quarter of 2012, the growth rate for the GDP without the impact of inventory was higher at approximately 2%. This means that aside from fluctuations due to inventory, the growth rate of the economy actually slowed in 2013 from that in the end of 2012.
There are many details that could be discussed about the GDP report. For now, I will leave that to others. Instead, I want to emphasize just how poor these results truly are. If America has to deal over the long term with a growth rate of 1.5% or less, we can expect rising unemployment, more folks dropping from the labor force, stagnating incomes, increasing poverty, and an ever rising government debt. Since World War II, there has never been a "recovery" like this one. The rapid growth that follows recession and which comes from the demand that built up during the downturn is just not there. The problem is not a lack of demand. There are plenty of young folks who need homes, cars and other goods. The problem is a government policy which inhibits growth in the name of some other goal. Call it what you want, but the result will not vary. Those who support it will say that America is promoting diversity, fairness, equality, or some other ideal. The result, however, is that everyone suffers. Let me rephrase that: everyone but the rich suffers. It is the middle income people who get squeezed when Obamacare drives up medical insurance costs by half. It is the small businesses who lose out when Dodd Frank restrictions result in it becoming impossible for these small companies to get bank credit. It is people who commute to work each day by car who suffer when environmental restrictions prevent production of American energy and drive consumption to high priced foreign oil. It is workers without jobs who suffer when new investments in American businesses are discouraged by the highest corporate tax level in the world.
Eventually, the American people will wake up and realize what has been done to them. It had better happen soon, before it is too late.
There are many details that could be discussed about the GDP report. For now, I will leave that to others. Instead, I want to emphasize just how poor these results truly are. If America has to deal over the long term with a growth rate of 1.5% or less, we can expect rising unemployment, more folks dropping from the labor force, stagnating incomes, increasing poverty, and an ever rising government debt. Since World War II, there has never been a "recovery" like this one. The rapid growth that follows recession and which comes from the demand that built up during the downturn is just not there. The problem is not a lack of demand. There are plenty of young folks who need homes, cars and other goods. The problem is a government policy which inhibits growth in the name of some other goal. Call it what you want, but the result will not vary. Those who support it will say that America is promoting diversity, fairness, equality, or some other ideal. The result, however, is that everyone suffers. Let me rephrase that: everyone but the rich suffers. It is the middle income people who get squeezed when Obamacare drives up medical insurance costs by half. It is the small businesses who lose out when Dodd Frank restrictions result in it becoming impossible for these small companies to get bank credit. It is people who commute to work each day by car who suffer when environmental restrictions prevent production of American energy and drive consumption to high priced foreign oil. It is workers without jobs who suffer when new investments in American businesses are discouraged by the highest corporate tax level in the world.
Eventually, the American people will wake up and realize what has been done to them. It had better happen soon, before it is too late.
1 comment:
Blindness by propaganda, that is the results of how our media groups perpetrate their will on our society/culture.
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