As the U.S. economy shows sudden weakness, American consumers understandably express increasing anxiety…
CFIF on Twitter CFIF on YouTube
Elizabeth Warren Prepares to Punish the U.S. Economy and Investors with Her Misnamed "Stop Wall Street Looting Act"

As the U.S. economy shows sudden weakness, American consumers understandably express increasing anxiety.  A troubling new Gallup survey reports that economic confidence has now declined to lows unsurpassed since the early days of the Covid pandemic in 2020.

Undeterred by that accumulating weakness and alarm, however, Senator Elizabeth Warren (D - Massachusetts) appears restless to strike yet another dangerous hammer blow by re-introducing her misnamed "Stop Wall Street Looting Act."

She may think that title can conceal the bill's danger, but Americans and elected officials mustn't be fooled or invite the potentially catastrophic economic peril.

Senator Warren’s bill includes significant tax increases, as well as new legal liabilities and bureaucratic regulations on U.S. investment…[more]

October 18, 2021 • 01:48 PM

Liberty Update

CFIFs latest news, commentary and alerts delivered to your inbox.
“Recovery Summer,” Episode V – New Government Report Shows U.S. Economy Stalling Five Years into Recovery Print
By Timothy H. Lee
Thursday, August 01 2013
Simply put, the Obama recovery hasn’t been a recovery at all.

Three long years ago this week, on August 2, 2010, former Treasury Secretary Timothy Geithner announced unambiguously in The New York Times, “Welcome to the Recovery.” 

That was during the second of the Obama Administration’s so-called “Recovery Summers.”  Now into our fifth such summer, Americans still await an actual recovery. 

That unfortunate reality was reinforced this week, when the U.S. Commerce Department announced second-quarter gross domestic product (GDP) growth of just 1.7%.  That follows first-quarter 2013 growth of just 1.1%, and fourth-quarter 2012 growth of just 0.1%.  Together, that means our economy has grown less than 1% over the past nine months. 

That obviously provides additional confirmation that Obama’s economic agenda has failed, even as he barnstorms the country demanding more of the same.  But it is also ominous for what it suggests lies ahead.  As noted by Spencer Jakab of The Wall Street Journal this week: 

“Growth below 2% for multiple quarters is thought to heighten the risk of recession.  A Fed study in spring 2011 quantified the perils of stalling.  It found a dip below 2% GDP growth – on a year-over-year basis rather than an annualized measure – was followed by a recession 70% of the time.” 

Notably, the Commerce Department report also refuted the Obama Administration’s predictions of disaster during the federal budget sequester debates, and more on that in a moment. 

But first, some perspective on the latest economic numbers. 

Since 1929, the average U.S. economic growth rate has been 3.3%.  Obviously, that number is statistically weighed down by the fact that the Great Depression began in 1929, and the average also includes the 2008-09 downturn.  But even at that, the second-quarter’s 1.7% growth is just half of the U.S. long-term average, and the last three quarters less than one-third that average. 

For further reference, growth averaged a robust 4.4% between 1983 to 1989 following the Reagan tax cuts, strong dollar policy and deregulation.  For what it’s worth, even George W. Bush saw an average of 2.52% GDP growth during the first 18 quarters of his tenure, compared with 1.62% during Obama’s first 18 quarters.  While Obama’s defenders will assert that his numbers are reduced by the recession he inherited from Bush, Bush can similarly assert that his numbers were reduced by the recession he inherited from Clinton in 2001. 

Moreover, even excluding the 2009 recessionary quarters and counting only those since the recovery began in mid-2009, Obama has averaged just 2.2% growth.  Post-recession recovery periods typically show stronger-than-average growth due to the rebound effect, but even Obama’s “recovery” comes in below Bush’s average for the same period in his presidency, which includes the 2001 recessionary period. 

Simply put, the Obama recovery hasn’t been a recovery at all. 

Even more ominously for his administration and its supporters, public opinion increasingly reflects the failure of his agenda. 

According to Rasmussen, nearly twice as many Americans report that their finances are getting worse rather than better, by a 40% to 24% margin.  And according to the left-leaning Pew Research Center, some 70% of Americans say that the economic recovery has not yet begun, dwarfing the 28% who say that it is underway.  That same Pew survey shows that an overwhelming 82% majority rate economic conditions as “Poor” or “Only Fair,” while just 17% say they’re “Excellent” or “Good.”  In the fifth year of a recovery, that speaks volumes. 

Perhaps most alarmingly for the Obama Administration and his cheerleaders at MSNBC, the public now says it trusts Republicans more than Obama on the economy, which remains the most important issue facing the country. 

Returning to the sequester debate and Obama’s assurances that it would bring catastrophe, the Commerce Department report pours cold water on that claim.  According to the data, government spending only affected second-quarter GDP by 0.1%.  That compares with a 1.3% impact in the fourth quarter of 2012 and 0.8% impact in the first quarter of 2013. 

Meanwhile, 2 million fewer Americans are employed today than in 2008, even though our population has increased by 13 million during that span.  And median household income is now $51,500, down $171 from 2012’s $51,671.  It’s also $2,718 lower – some 5% – than the $54,218 median income in July 2009 when the current “recovery” began. 

Recessions and recoveries come and go in our market economy.  What distinguishes this cycle, however, is the unprecedented onslaught of wasteful spending, record deficits, higher taxes and more regulation under Obama.  The accumulating data shows the disastrous result – the worst recovery in recorded history. 

Americans must bear that in mind as Obama and the political left demand more of what got us here as another debt limit and budget debate approach. 

Quiz Question   
In which century were the first mandatory vaccination laws enacted in the United States?
More Questions
Notable Quote   
 
"At the end of last week, there were 584 container ships idling off the world's ports, waiting to be loaded or unloaded. Disruptions in the bulk cargo sector look to be even worse.Experts suggest the problems are temporary. For instance, Bloomberg columnist Brooke Sutherland maintains that three weeks of declines in ocean freight rates tells us 'the worst may be over for the supply-chain snarls that…[more]
 
 
—Gordon G. Chang, Author of "The Coming Collapse of China"
— Gordon G. Chang, Author of "The Coming Collapse of China"
 
Liberty Poll   

Which is the current greatest day-to-day concern to your family?