Commentary Magazine


Contentions

The GDP Report

The Commerce Department this morning gave a reading on the third-quarter 2012 Gross Domestic Product—the sum of goods and services produced in the United States. GDP climbed 2 percent (on an annualized basis) in July, August, and September, slightly above the predictions of economists. This was an improvement on the dismal 1.3 percent growth the economy saw in the second quarter, but still a long way from the sort of robust recovery that is needed to significantly bring down the unemployment rate and restore a sense of prosperity to the country.

Much of the growth was in consumer spending, especially for durable goods (such as automobiles, refrigerators, etc.), which saw growth at 8.5 percent. But business investment remained weak, with fixed investments (buildings and equipment, for instance) actually declining 1.3 percent after climbing 3.6 percent in the second quarter.  This might reflect caution ahead of the election and fear that the “fiscal cliff” of tax hikes and government spending cuts due January 1 might actually come to pass. Most economists think that that would send the economy right back into full-blown recession.

Exports shrank, reflecting the deepening economic problems in Europe. Imports also fell, but at a lower rate. Federal government spending also accelerated in the quarter.

This isn’t a game-changer in the election by any manner of means. Everyone knows the economic recovery, which began in June 2009, four months into Obama’s term, has been anemic at best, so this report is just a continuation of the status quo. The jobs report due out next Friday might be more significant as it could show a rise in unemployment, correcting the anomalous October jobs report that showed an unexpected .3 percent drop in unemployment. If unemployment were to rise above 8 percent again, just four days before the election, that would be very bad news for President Obama.


Join the discussion…

Are you a subscriber? Log in to comment »

Not a subscriber? Join the discussion today, subscribe to Commentary »





Welcome to Commentary Magazine.
We hope you enjoy your visit.
As a visitor to our site, you are allowed 8 free articles this month.
This is your first of 8 free articles.

If you are already a digital subscriber, log in here »

Print subscriber? For free access to the website and iPad, register here »

To subscribe, click here to see our subscription offers »

Please note this is an advertisement skip this ad
Clearly, you have a passion for ideas.
Subscribe today for unlimited digital access to the publication that shapes the minds of the people who shape our world.
Get for just
YOU HAVE READ OF 8 FREE ARTICLES THIS MONTH.
FOR JUST
YOU HAVE READ OF 8 FREE ARTICLES THIS MONTH.
FOR JUST
Welcome to Commentary Magazine.
We hope you enjoy your visit.
As a visitor, you are allowed 8 free articles.
This is your first article.
You have read of 8 free articles this month.
YOU HAVE READ 8 OF 8
FREE ARTICLES THIS MONTH.
for full access to
CommentaryMagazine.com
INCLUDES FULL ACCESS TO:
Digital subscriber?
Print subscriber? Get free access »
Call to subscribe: 1-800-829-6270
You can also subscribe
on your computer at
CommentaryMagazine.com.
LOG IN WITH YOUR
COMMENTARY MAGAZINE ID
Don't have a CommentaryMagazine.com log in?
CREATE A COMMENTARY
LOG IN ID
Enter you email address and password below. A confirmation email will be sent to the email address that you provide.