Tag: GDP

Jobs Deficit: Austerity Politics Threatens Economy

Jobs Deficit: Austerity Politics Threatens Economy

Posted: 01/30/2013 1:25 pm EST  |  Updated: 01/30/2013 1:46 pm EST

Obama AusterityWASHINGTON — Lawmakers were stunned Wednesday to learn that the U.S. economy officially dove toward a double-dip recession at the end of 2012, contracting for the first time in three and a half years amid steep declines in government spending and sluggish exports.

Policymakers were similarly stunned in Europe when reductions in government spending led to continued economic malaise, leading top economists there to question the logic behind austerity recommendations. European austerity programs are a major driver of the slowdown in U.S. exports, and several economists have argued that reductions in government spending, here and abroad, are almost solely responsible for the suddenly tanking economy. Continue reading “Jobs Deficit: Austerity Politics Threatens Economy”

The U.S. Economy Is Shrinking: Now Is the Time to Worry

AFL-CIO Now

01/31/2013 William Spriggs

Photo courtesy of Wikimedia commons.

MAD magazine’s Alfred E. Neuman was always shown with a grin on his face, captioned, “What, me worry?” Well, now it is time to worry.

The release of the advanced GDP numbers—measuring all goods and services produced in the United States—for the past three-month period of 2012, shows the economy shrinking. Why? Well, personal consumption—all those Christmas gifts—grew by 2.2%, a growth rate faster than in the preceding quarter. Non-residential fixed investment, what businesses are buying to increase their economic activity going forward, jumped by 8.8%, almost six times faster than in the preceding quarter, and imports dropped significantly (a drain on the system, since that is money going abroad), so that the net effect of exports and imports was a boost of 5.7% to the economy. So, if people are buying more, business is investing more and imports aren’t sucking the wind out of the economy’s sails, where did we go wrong? Federal expenditures plummeted by 15%. The big chunk of the drop from federal expenditures came in defense expenditures. Continue reading “The U.S. Economy Is Shrinking: Now Is the Time to Worry”

An Update to the Budget and Economic Outlook: Fiscal Years 2012 to 2022

An Update to the Budget and Economic Outlook: Fiscal Years 2012 to 2022

For fiscal year 2012 (which ends on September 30), the federal budget deficit will total $1.1 trillion, CBO estimates, marking the fourth year in a row with a deficit of more than $1 trillion. That projection is down slightly from the $1.2 trillion deficit that CBO projected in March. At 7.3 percent of gross domestic product (GDP), this year’s deficit will be three-quarters as large as the deficit in 2009 when measured relative to the size of the economy. Federal debt held by the public will reach 73 percent of GDP by the end of this fiscal year—the highest level since 1950 and about twice the share that it measured at the end of 2007, before the financial crisis and recent recession. Continue reading “An Update to the Budget and Economic Outlook: Fiscal Years 2012 to 2022”

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