U.S. Treasury Secretary Timothy Geithner, Spain's Finance Minister Elena Salgado, Bank of Korea Governor Kim Choong-soo, South Korea's Finance Minister Yoon Jeung-hyun and France's Economy Minister Christine Lagarde at the G20 Finance Ministers and Central Bank Governors meeting. Image Credit: Reuters
Gross Domestic Product growth revised by Obama's Commerce Department down 15.6%
The Obama Administration was wrong in its initial estimate of the growth in our economy during the first quarter (January through March 2010) of this second year of the 44th Presidency.
The first estimates released to the public by the Commerce Department placed the growth in the GDP, which measures consumer spending, at an anemic but sustainable 3.2%. This growth would have shown some positive effect of the nearly one-trillion dollar Stimulus Government Spending legislation that was passed into law over one year ago ... if it were true, but this initial estimate was a fabrication.
Today, the Obama Administration released a second revised figure which set the level of growth downward to only 2.7%. This growth represents a negative growth because it does not keep up with the expansion in our population and shows how little Government spending can do to spur the economy in creating wealth through economic growth.
This excerpted and edited from the Wall Street Journal -
Economists React: ‘Not an Encouraging Mix’ in GDP Report
By Phil Izzo, Wall Street Journal - June 25, 2010, 10:42 AM ET
Economists and others weigh in on the downwardly revised 2.7% advance in first-quarter GDP.
–The revision was a result of a downward adjustment to consumer spending and higher than originally reported imports, which were only partly offset by upward revisions to exports and inventories.
The biggest debate is over the path of the labor market recovery and hence the ability of consumers to help drive real growth.
–Joshua Shapiro, MFR Inc.
–The economy is still vulnerable to a double dip scenario. The downward revision from 3.2% in the advanced report to 3% in first revision and now just 2.7% shows that as the Obama/Bernanke stimulus wears off so does the upward momentum in the economy. With the banking and consumer sector still struggling with weak balance sheets , exogenous events like the European Sovereign Debt crisis are more likely to have lasting negative effects on the recovery.
–Steven Ricchiuto, Mizuho Securities
–The 2.7% first quarter GDP gain is below the Fed’s 2010 central tendency of 3.2% to 3.7%. Growth would have to average between 3.3% and 4.0% the rest of the year to hit the Fed’s forecast. –Jonathan Basile, Credit Suisse
Do not look for any grand leadership that has our country looking to make growth our primary agenda.
This also excerpted and edited from the Wall Street Journal -
Our Agenda for the G-20
Countries should work to stabilize debt levels, enact new financial regulation, and reduce their dependence on fossil fuels.
By TIMOTHY GEITHNER And LAWRENCE SUMMERS - WSJ Opinion Journal - JUNE 23, 2010
While the U.S. was the major source of demand for the world economic growth before the crisis, global demand must rest on many pillars going forward. That is why the G-20 must support Europe's reform program and the financing that Europe and the IMF will provide to countries facing acute fiscal challenges.
To maintain the momentum of the U.S. recovery, we need strong, balanced and sustainable global growth. Global growth will help double U.S. exports over the next five years, supporting several million American jobs, a key goal of the president's export initiative.
In this new era, when emerging markets account for two-thirds of global growth, concerted action by the G-20 is the only effective way to confront the challenges that lie ahead.
Now ... doesn't that make one feel confident about the economic leadership and growth here in this era of Carter's Second Term!
We need a new coach - we can not play the "World's Game" with a leadership that doesn't care that the team has as a goal ... to win the league! ... every other team on the field has that as the goal.