Ask half a dozen people about the latest report on gross domestic product ( GDP ), and you're likely to get half a dozen answers about just what it means. You may also be tempted to ask what it even measures, and why it matters. The short answer is that it measures the nation's economic growth, and the latest report on the GDP suggests that our rate economic growth has slowed to 1.5%, from 2.0% in the last quarterly report.
Depending on whom you ask, that our rate of economic growth is lethargic. Or it's troubling, but not surprising. It isn't great news for President Obama, but it isn't bad news either. The recovery is either stalling, or fading before our eery eyes. All that may be true, but it also represents a failure of leadership at the highest levels of our government.
Over at the Economic Policy Institute, Josh Bivens and Nicholas Finio, look at "actual GDP as a percentage of 'potential GDP '," and as symptom — one that "is not moving the economy much closer to full health, and may even be doing real damage to that long-run health" — of a much bigger problem. They offer a succinct diagnosis at the end of their post.
… There’s a long line of research that finds that extended slumps can actually reduce potential GDP ; think of all the factories and labor market skills that would’ve been built and nurtured over the past four years if the economy was running at full capacity.
This continuing economic slack clearly signals that the economy would benefit from more support from policymakers.
It's the equivalent of your doctor taking a look at your blood pressure and/or cholesterol levels, noting that they aren't great, but could be and would be better if you got off your ass ass did something about it. Maybe she even gives you a handful of pamphlets or articles outlining simple fitness tips like "Get off the couch," and easy-to-do exercise programs like "Go for a walk." Maybe she even hand delivers a pair of walking shoes to your door, and all but laces them up for you.
If you're the 112th Congress, you're likely to go back home, flop back down on the couch, complain about the doctor. You'll do nothing — which is pretty much you've been doing for quite a while now.
That is, you'll do nothing except complain that the doctor didn't tell you how to improve you're health outlook, and gave you nothing to point you in the right direction.
But if you're the 112th Congress — particularly the Republican-dominated House — and the doctor is the president, the truth is you just haven't bothered to get off your ass. That's the blunt assessment. Alan Krueger, Chair of the Council of Economic Advisers, posted the nicer version on the White House blog.
To strengthen economic growth and increase job creation, President Obama has proposed to Congress a plan that would help State and local governments retain and hire teachers and first responders, assist the construction sector and economy of tomorrow by rebuilding and modernizing our Nation’s infrastructure, and would give small businesses tax cuts to encourage them to increase payroll. President Obama also proposed extending tax cuts to protect middle class families and virtually every small business owner from getting a tax increase at the beginning of next year. The Senate passed the President’s plan this week and President Obama has said that as soon as the House will act he will sign it right away in order to give certainty and security to middle class families. Extending these tax cuts would provide more certainty for the economy for 98 percent of American families and 97 percent of small business owners.
As I posted earlier this month, Republicans in Congress have had plenty of opportunities to get off their asses and do something to improve the health of our economy.
First, though, let’s put things in perspective. When John Boehner accuses Democrats of stalling Republicans’ so-called jobs bills, let’s remember that this is the same guy who said "So be it" to reports that the GOP’s job-killing cuts would cost thousands their jobs.
When Mitt Romney says the President has not jobs agenda, let’s remember this: Mitt Romney says a lot of things that aren’t true. For example, Romney claim that he has presented a detailed jobs plan while the president has not just isn’t true.
Remember, that if anybody is betting on failed policies, it’s Mitt Romney. Let’s remember that Romney’s policies are essentially George W. Bush’s policies - the same George W. Bush most Americans still blame for the economic crisis that Obama basically inherited.
Romney’s "jobless plan" is the same old job-killing madness that went on under Bush, which resulted in a lost decade of zero net job creation. It’s likely to create more jobs in China than in the U.S. It won’t lower the unemployment rate, and will add thousands more to the ranks of the unemployed - like teachers, police officers, and fire fighters. Apparently, Republicans think losing those jobs is a good thing. That’s why congressional Republicans sat on their hands while state and local governments laid-off thousands, and refused to save those jobs. Is it any wonder a majority of Americans have a low opinion of Republicans in the House?
In September of last year, the president handed Congress a bill called the American Jobs Act.
That is the jobs bill that the President sent to Congress back in September 2011 - damn near a year ago - and pitched to voters in John Boehner’s own back yard:
- the jobs bill that nearly two thirds of Americans support.
- the jobs bill that Moody’s said would create 1.9 million jobs and grow the economy by 2%.
- the jobs bill that Macroadvisors said would create at least 1.3 million jobs.
- the jobs bill the CBO said would reduce the deficit by $6 billion in the next decade, in the Senate version. (Who says we have to choose between job creation and deficit reduction?)
That’s the jobs bill the President is still fighting for today in nine battleground states today. That’s the jobs bill that on the table, still waiting for Congress to act.
Imagine the shape our economy would be in if Republicans had followed the president's lead? What kind of shape would we be in if hundreds of thousands of laid-off state and local government workers were still on the job, or had gone back to work. Public sector jobs beget private sector jobs, because public sector workers get most of what they need to do their jobs from the private sector. More people working in the public sector means even more work for people in the private sector, as consumer demand increases because more people are earning paychecks they will spend on goods and services.
Instead, Republicans have:
- pushed "jobs" bills that are not about jobs;
- offered jobs bills that won't actually create jobs;
- stalled any effort at job creation, even as layoffs of state and local employees fuels a "vicious cycle" of unemployment and economic crisis;
- demanded an austerity agenda that benefits Wall Street and the one percent, at the expense of middle- and working-class Americans;
- "voted 15 times against Democratic proposals or efforts to consider proposals - several of which are bipartisan - to create or protect American jobs"
In the meantime, Republicans in Congress have found time to:
- introduce legislation to:
- prolong a debt ceiling fight that cost taxpayers $1.3 billion;
- vote 33 times to repeal health care reform (and increase the deficit, in the bargain).
The list could go on, and on. For what I haven't included, see Ezra Klein's list of 14 reasons why this is the worst Congress ever.
The bottom line is this: the latest GDP report is another symptom our declining state of economic health, and a confirmation of the long-standing diagnosis: a Congress that refuses to get off its ass and do something about it.
Not to steal the First Lady's thunder, but this Congress has had plenty of opportunities to "get moving" and get out economy moving in the right direction. Yet, they're still waiting for someone to lace up their walking shoes.
