GDP Report Is Bad News For Republican Recession Claims


GDP Report Is Bad News For Republican Recession Claims

Share this article
GDP Report Is Bad News For Republican Recession Claims

All summer long, Republicans expected the US economy to be in recession because the country's overall economic growth in the first half of the year was negative.

"Everything about Biden 's failure was predictable and avoidable," House Minority Leader Kevin McCarthy said in July . "They just didn't want to see Democrats in Washington."

McCarthy and others have argued that two-quarters of negative growth equals recession, although recessions are often associated with massive job losses, not just negative growth. This year has been nothing but rapid job growth.

The Commerce Department said Thursday that the economy grew in the third quarter.

Positive growth doesn't mean a recession isn't imminent, but it does mean that when you start the year, it's been much milder, hasn't involved widespread strikes, and the unemployment rate is close. Record lows continued throughout the period.

President Joe Biden paid tribute to his enemies in his 2.6 percent GDP growth announcement.

"They've been saying for months that the U.S. economy is in recession and that Republicans in Congress want a slowdown," Biden said. But today we have more evidence that our economic recovery is progressing.

Of course, economists see two consecutive quarters of negative GDP growth as a sign of recession. And it's true that a shrinking economy is bad.

But explaining a recession always involves more than data. The National Economic Research Business Cycle Dating Committee, a private nonprofit organization, keeps an official record of the beginning and end of recessions.

The NBER calls recessions after the fact, so if the recession had happened earlier in the year, it wouldn't have been called then. But, as they explained on their website, not only GDP, but also: b. Measures of personal income, employment, consumer spending and industrial production. And they even note that "real GDP may decline by relatively small amounts for two consecutive quarters," without mentioning a recession.

See also  Chandigarh's Open Hand Monument: Symbol of the City's Spirit

Economists' third-quarter GDP report showed a generally healthy economy, strong consumer spending and business investment, and a slowdown in inflation. Republicans still use it.

Rep. Kevin Brady (R-Texas), the top Republican on the House Ways and Means Committee, said Thursday that "economists have pushed back economic forecasts to reflect [Biden's] tougher policies."

And Brady said the GDP report is not very positive.

"A sharp increase in exports and government spending led to a temporary positive number, a 'phantom growth,' as key drivers of the economy, such as investment and consumer spending, contracted again," Brady said.

Joint Economic Committee Chairman Don Beyer (D-Va.) said the Commerce Department's Bureau of Economic Analysis compiled the GDP numbers by bona fide professional economists, not a group of Democrats. He said it was unfortunate that Republicans were constantly undermining institutions.

It goes with it. The FBI cannot be trusted. You can't trust [the Justice Department, the IRS is going to screw you over.'' The whole idea of ​​not trusting the institutions that make our country the best in the world,” Burr told HuffPost.

Rep. Jason Smith (R-Mo.), the top Republican on the Appropriations Committee, said we are still headed for a recession.

"During the 2007-2009 recession, the United States had a negative quarter of GDP, followed by a brief surge of negative growth quarters," Smith said Thursday.

If the Federal Reserve raises interest rates and slows the economy as a whole to fight inflation, the economy could enter a recession next year. The Fed predicts that unemployment will rise significantly in 2023.

See also  New Skoda Kodiaq SUV gets official

The strange thing about Republicans pushing for a recession right now is that the American public is so angry at the economy because of high inflation that it shows no signs of slowing down, and that gives the Republicans a chance to win the next election. to fight the term . Despite the absence of a recession, the economy continues to hamper Democrats.

This article originally appeared on HuffPost and has been updated.


Sunak is in | Bloomberg Tracking 10/24/2022

Leave a Reply

Your email address will not be published. Required fields are marked *