Source: Congressional Budget Office
Posted on 11/18/2012 2:18:34 PM PST by lbryce
A new study from the Congressional Budget Office starts with the scariest graph you’ll see today.
Source: Congressional Budget Office
In other words, you’re not imagining it: This economic recovery has been a big disappointment relative to what the United States has usually experienced after a recession. Growth has been 9 percent below what was seen in past recoveries on average in its first three years. The CBO report tries to disentangle where that underperformance is coming from and its answer is deeply unsettling: The U.S. economy just isn’t as good at growing as it used to be.
The new CBO report claims that two-thirds of the underperformance of the economy over the past three years compared to a typical recovery is due to a slower rate of growth in potential GDP. Only one-third, in this analysis, is due to factors related to this recession.
Potential GDP is the measure of what the economy is capable of producing if almost all of the people who want jobs are able to get one and almost all its machines and buildings were humming at their potential. While it has grown consistently through modern U.S. history (we can thank a growing population and steadily improving technology for that), it doesn’t always grow at the same rate. In periods when baby boomers were reaching their working years and women were entering the workforce in large numbers, the rate at which potential GDP rose was very high, over 4 percent at times, by the CBO’s reckoning.
In recent years, though, those trends have reversed. Baby boomers are starting to retire and the proportion of women who work has leveled off.
(Excerpt) Read more at washingtonpost.com ...
Egggsactly! His mentors..Cloward and Piven are justifiably PROUD of their Marxist protege’.
>>This economic recovery has been a big disappointment
What economic recovery? I have more unemployed friends now that ever. I know more underemployed people than I’ve ever known. Prices are up. Wages are stagnant at best, but lower for many. Even my 401k has not even made up the losses of the last 4 years.
Where is the recovery that I keep hearing about, or is all just statistical smoke and mirrors?
There won’t be enough left of the USA, economically, in 2016 for conservatives to salvage.
There are fiscal realities and they don’t paint a pretty picture.
And yeah, it’s scary in various ways.
The ice cream vendor - Zero - is preparing to give out more ice cream with “taxes on the rich” and the free ice cream will attract more voters. What scares me is the current underground move to abolish the 22 Amendment. The Petraeus sex scandal is what the right hand is doing. What’s the left hand up to?
It's all because Republicans stayed home from the stores
(VERY pissed off at other threads (and FreepeRs) that say the election is all because Republicans stayed home)
Must be because of racism!/s
The difference is that previously they guy in the oval office supported recovery. This time, 0bama is working to prevent recovery.
Taxation and regulation......the primary industry in DC....has prevailed.
you didn’t stay home did you?
Washington Post: It appears that the Emperor may not be wearing much in the way of clothing.
Well, what took y’all so long to deduce this?
We see the disincentives all around us these days for hard work, playing by the rules, being innovative, etc. Do these things and you’ll be punished for your efforts by the state, and demonized if you actually overcome the ever rising levels of taxation and regulation and somehow succeed. Being a parasite is where it’s at these days - not a host. There’s no fun in that, especially with Obamaclaus and the demo-elves in power.
And we all know that the government inflation numbers are completely bogus and wildly under report the true inflation numbers so drop the slope of that line by about 50% if you want a more realistic representation of the “recovery rate”.
I’ve read the CBO report and I highly recommend that Freepers go read it.
The CBO makes a bunch of observations, but falls short of making a diagnosis because to do so is socially inconvenient and embarrassing in DC, where the received “conventional wisdom” chants ideas that we need more “free trade” to export more of our actual wealth creation while importing more unemployment through immigration of low/no skill immigrants, 56% of whom are on public assistance within a year.
But, as they say about booze-hounds and dopers, the first step in recovery is recognizing that you have a problem, and this CBO report is a first step on the first step of 12, right?
Dapper, so glad to have an alternative analogy to Santa. Can we forward to Rush, just as a suggestion. Am begging him to drop Santa, a caricature of a true person in history, St. Nicholas, who did tons for children without taking anything and who has a list of the undeserving (and uses it- from my experience).
Ugh, Comparing Hussein to him.
Apparently he has.
That’s pretty much where I’m coming down, and too many Republicans don’t want to admit it. Especially the clowns in DC.
But, numbers don’t lie, and unlike economists, engineers don’t let numbers lie and we don’t make simplifying assumptions... if engineers did their math the way economists did, you’d see engineering papers start out like this:
“Assume there’s no friction or gravity...”
The most interesting thing about that graph (which I’ve seen many times before) is to take notice of how the shape of the recovery curves has changed since a) we’ve gone to a completely fiat currency, which b) has allowed the Fed to have complete control over monetary policy. As we can see, the post ‘73 recessions have much more “rounded” recovery curves, and every recession has required longer and longer periods of time to recover from, albeit with less sharp declines in unemployment.
This has resulted in the bottom, 2007, curve, which shows that the ability of the economy to purge itself of mis-allocation of capital has now been so impeded that it cannot recover and employment is taking forever to recover.
There has been no “recovery”. Even back when the economy was supposedly “good”, it wasn’t as we were busily off-shoring jobs and building up debt on top of debt, while expanding government handouts. It was all a sham.
Now we simply have a house of cards that they are trying to keep from falling.
I dislike that analogy too. I prefer to think of Øbongo as the stereotypical drug dealer - handing out “free” samples to get you hooked and then robbing you of your very soul.
The only thing about the CBO article with which I take issue is the assertion that weak consumer spending — less GDP wealth going to labor — is predominantly responsible.
Economies don’t grow because of increased consumer spending by labor; on the contrary, an increase in consumer spending by labor is a *result* of a growing economy. What grows an economy is an increase in private-sector investment leading to 1) an increase in private-sector jobs, and 2) an increase in private-sector productivity.
The increase in productivity leads to lower prices for goods and services, which, in turn, leads to the increase in consumer spending.
The CBO article at least was honest enough to mention that “uncertainty” appears to be playing a part in the current economic stagnation. It didn’t mention, however, that the main source of this uncertainty is the upcoming crop of new taxes and regulations implemented by the Hussein Obama administration.
Actually it is much worse than that..
The CBO has always been delusional.. totally political..
unless they were outright lieing right to your face..
There has been no “recovery”. Even back when the economy was supposedly “good”, it wasn’t as we were busily off-shoring jobs and building up debt on top of debt, while expanding government handouts. It was all a sham.
Now we simply have a house of cards that they are trying to keep from falling.
“(VERY pissed off at other threads (and FreepeRs) that say the election is all because Republicans stayed home) “
You cannot say that voters staying home wasn’t part of the issue. Sorry but the number’s don’t lie.
wait... the left has been trying to tell us that this has been an awesome and fantastic recovery
Nothing against Rush, at all. He is on to something. I like your analogy.
Yep, I engineered software systems. The difference between fantasy and reality was something I had to hammer home over and over to customers and management.
Including a gov’t agency (not secret, but unnamed) where the managers insisted I deploy a software system before it was completely written, integrated, tested, etc. I refused. And I stood alone.
If you look at the last four, seems to be a downward trend, greatly exacerbated in the current one.
Great Society, anyone?
Ok, there are structural reasons why the economy isn’t recovering as fast as in the past. I will accept that. Major demographic changes are apparent. However, I see this article as more cover for Obama. It really isn’t his fault. There are structural reasons for the anemic recovery. The same could have been said for Bush but they (the left, MSM) still blame him for most of the problems we have today. The truth is, for a variety of reasons, we have more people taking out of the system than are putting into it. Nothing will change until this change is forced onto us. That change will happen pretty soon and the pain will be severe. The majority of voters who showed up this time don’t care about any of this. They just wanted a cool man of color to beat the evil rich white guy. I am sick of all the rationalizations on both sides. That is the unvarnished truth. Mitt Romney was the most milk toast moderate squishy sort of Republican and the left still demonized him and voted their tribal leanings. Pain is coming to all of us. Obama, being culturally attuned and cool, will do nothing to prevent that result.
Thank WTO, Free Trade and Illegal Immigration (lack of enforcement under Bush 41 thru GWB). Corporate America made their short term record profits, problem is how do you rapidly recover after hurting youself with overleveraging, investing in AAA investments that were actually junk, etc etc etc. In the past we had a cushion, but now thanks to corporate America China has closed the tech gap (courtesy of American corporate tech transfers) with cheap labor. As the economy slowsdown, corporate America will try to extend prosperity by off shoring jobs till it no longer prevents the downturn. Add Obama taxes and regs the economical structured hole is even deeper.
.. (snort!) Bush’s fault! . . . Not Obama’s, nor is it Nazi Pelosi’s, nor is it Harry Reid’s . . . they’ve had six years to “fix” it . . and “fix” it they have! Just wait ‘til they “fix” it four more years . . . still blaming “Bush” and the “uncooperative” Repubicans.
Government confiscation of IRA’s/401k’s coming soon..
After ts al sadi and done we will have wasted 8 years og the avg lifespan 78.
Can we sue the DNC for 10% of our lives value?
After it’s all said and done we will have wasted 8 years of the avg life span 78.
Can we sue the DNC for 10% of our lives value?
“(VERY pissed off at other threads (and FreepeRs) that say the election is all because Republicans stayed home)”
Simple arithmetic. The guy who gets the most votes wins.... and the other guy loses. So yes, those that didn’t bother to vote for “love of country” gave it to Obama.
Now, each have their own reason for not bothering to vote in this most critical of elections, fair enough.
If you are one of the ones that stayed home, don’t be “pissed”, be proud.... because you got exactly want you wanted and you’re going to get what you deserve.
Now, if you ran out of gas on your way to the polls, that’s something else, but I think folks should do their best to work off of the top of the gas tank, not the bottom.
Since this information is MONTHs late WHO cares what the Compost reports.
Milk Toast> Milquetoast
FDR’s Treasury secretary Henry Morganthau in May 1939:
“We have tried spending money. We are spending more than we have ever spent before and it does not work. And I have just one interest, and if I am wrong ... somebody else can have my job. I want to see this country prosperous. I want to see people get a job. I want to see people get enough to eat. We have never made good on our promises ... I say after eight years of this Administration we have just as much unemployment as when we started ... And an enormous debt to boot!”
That's why I call mine a 201K.
LOL. That just about sums it up!
The best that can be done is settle out of court; the DNC will agree to taking 10% of the end out of life instead.
I was referring to the breakfast food :-D
Not my first or any choice ... but he was what I had and I'll be damned (and I guess I and we will be) if I'll vote for a mulatto, bastard usurper.
Interesting that my reply seems to indicate I was a stay at home voter
/8^)
I heard lots of folks like Hannity and Rove saying we won’t survive four more years. I’m afraid they were right.
He was right.
The government should have let the losers who got us into this mess, fail and/or go to jail.
The economic system would have cleared itself of counter-productive businesses, and we would have long since recovered by now.
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