August 26, 2011

IBD on GDP Criticizes the Endless Recovery

Filed under: Economy,Taxes & Government — Tom @ 10:25 pm

ComparingRecoveriesAt0811.pngReaganVsObamaThru8QtrsAsOf0811.pngAs expected, Investors Business Daily nails it concerning today’s even worse GDP news as does its graphic reproduced at the far right (the one at the near right updates the running Reagan vs. Obama chart for today’s GDP revision):

If you needed another metric by which to measure the failure of Obamanomics, new numbers released Friday show that two years after the recession ended the economy still hasn’t fully recovered.

According to the revised gross domestic product data released Friday, the nation’s economy grew a paltry 1% in the second quarter, after eking out a barely noticeable 0.4% gain in the first.

As a result, two years after the recession ended, the economy still hasn’t made up the ground it lost, giving Obama the dubious distinction of presiding over the most prolonged economic recovery since the Great Depression.

This isn’t just slightly bad. It’s monumentally bad.

An IBD review of all the post-World War II recessions shows that, on average, it took just over two fiscal quarters for the economy to recover from a downturn and start expanding again.

In contrast, we’re eight quarters into the Obama recovery, and the expansion is somewhere off in the distance, with real GDP still $65.5 billion below the pre-recession peak. And if you take into account all the population growth that’s occurred over the past two years, we’re even further behind.

Obama likes to blame the depth of the downturn for the “painfully slow” recovery. “We didn’t get into this mess overnight, and we won’t get out of it overnight. It’s going to take time,” he said — nearly a year ago.

The claim is bogus. This recession lasted only slightly longer than the 1981-82 contraction — 18 months vs. 16 — and wasn’t as severe when measured by peak unemployment.

This pathetic “recovery” is a monument to the failure of Keynesianism.

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