"Conservatives Undermining Our Economic Recovery" By Adam S. Hersh at Marketwatch

[applegrove]

Conservatives Undermining Our Economic Recovery

By Adam S. Hersh at Marketwatch

http://www.marketwatch.com/story/conservatives-undermining-our-economic-recovery-2012-07-27?link=MW_story_investinginsight

"SNIP..............................

But first, the “news.” The $15.6 trillion U.S. economy slowed in the three months through June 2012. U.S. gross domestic product, or GDP, the sum total of all goods and services produced by workers and equipment in the United States, grew at a 1.5% annual rate in the second quarter of 2012. We are growing, but slowing. And this must renew policy makers’ urgency for action to prevent our economy from dipping further.

Economists have known at least since last summer’s debt ceiling standoff in Congress that an economic slowdown was a high probability outcome if policy makers failed to reverse steep retrenchments in public investments that create jobs and strengthen growth. The tremendous uncertainty created by the political spat stalled private investment and hiring at the same time that public investments in education, infrastructure, and energy efficiency, and social safety net programs such as unemployment insurance were running to the end of their terms for many out-of-work Americans.

Back in 2011, the economy slowed to 1.3% growth in the third quarter from 2.5% in the second quarter as that year’s debt-limit fight further unsettled skittish businesses and left consumers questioning whether lawmakers could be trusted to take the right policy actions to ensure a strong American economy. Nonresidential business investment growth slowed a year ago from double-digit growth in early 2011 to less than 10% in December, 8% in the first quarter of the year and just 5.3% in today’s numbers.

This is why Obama proposed the American Jobs Act in September. This would have strengthened the economy through job-creating and growth-enhancing public investments in education and transportation infrastructure, and by providing support for those most vulnerable and hit hardest by economic pressures. The forecasting consultancy Macroeconomic Advisors and economists at Goldman Sachs estimated last September that the American Jobs Act would increase GDP by an additional 1.5% and create an additional 2.1 million jobs. Moody’s economist Mark Zandi warned, “If policy makers do nothing, the odds are very high we’ll go into recession next year.”

..................................SNIP"