• This is a political forum that is non-biased/non-partisan and treats every person's position on topics equally. This debate forum is not aligned to any political party. In today's politics, many ideas are split between and even within all the political parties. Often we find ourselves agreeing on one platform but some topics break our mold. We are here to discuss them in a civil political debate. If this is your first visit to our political forums, be sure to check out the RULES. Registering for debate politics is necessary before posting. Register today to participate - it's free!

U.S. GDP Grows Just 1.3%

You don't see a problem with accepting such low expectations especially 2 years after the end of the recession? Accepting such low economic numbers ought to concern everyone especially with 24 million unemployed and underemployed Americans. I would have expected a lot better numbers from someone that the liberal media claims is the smartest person ever to hold the office.

I'm not arguing that such an outcome is acceptable to say the least. It isn't.

My point is that it is consistent with experience following recessions driven by housing busts. The extent of debt involved in the housing sector is enormous--indeed, at the height of the housing bubble, mortgage debt had briefly exceeded GDP. That debt will need to fall back toward more sustainable levels. Hence, household deleveraging remains underway. In turn, that deleveraging suppresses growth in personal consumption expenditures, which account for about 70% of U.S. GDP.

Following the end of the housing bubble, jobs that had existed in housing-related industries (mortgage finance, construction, etc.) will not return to previous levels anytime soon. That is a structural unemployment issue, as many from those industries cannot necessarily transition into new industries for which very different skillsets are required. In addition, given the intensity of global competition, many companies are not hiring the long-term unemployed out of concern that their skills are not up to date. That is also a structural issue. In short, both slow macroeconomic growth and structural unemployment issues will are leading to an anemic jobs recovery.

Longer-term, the nation faces very real challenges. IMO, it does not deserve a AAA rating.

1. Political dysfunctionality is a barrier. By political dysfunctionality, I mean that the nation's political leaders are unable to effectively reach agreements on tough issues related to fiscal consolidation. That raises medium- and long-term issues as to whether the U.S. can adopt a robust fiscal consolidation program to tackle its long-term imbalances, much less sustain such a program. Such a program won't be painless. It will, in the near-term, present an additional contractionary headwind.

2. Long-term macroeconomic outlook: The combination of current structural unemployment issues, relative decline in educational attainment, increased risk of a secular rise in the cost of capital, competitiveness gaps in key sectors, and lack of public-private investment in potential growth opportunities (energy to aerospace, etc.) suggest that the nation's long-term growth rate potential is less than it was in the past. 2.5% annualized growth over the next 10 years might be optimistic. 2.0% might be more realistic. That means less tax revenue growth.

3. Federal financial ratios, especially debt:GDP and debt:revenue have deteriorated. There is little evidence of a concrete program to address those issues. Political dysfunctionality reduces prospects of such a program.

4. States have enormous long-term fiscal problems. Despite balanced budget amendments in most states, state finances are weak in the long-term. The amendements have led to the illusion of balanced budgets only because the states significantly underfunded pension and health obligations. If the present value of changes in such obligations were required to be placed on the financial statements, most states would have been running chronic, significant budget deficits. Hence, the utility of such amendments is questionable at best.

5. Structural health system problems: Specifically, the excessive cost growth problem remains unresolved. U.s. health care costs continue to grow at a multiple of national income, even as a significant slice of the population lacks coverage, and one cannot reasonably expect foreigners to continue to finance the system. That multiple is well beyond what is explained by demographic change (population aging/life expectancy). Hospitals remain "inflation factories." Fundamental health reform to address those issues remains unlikely for the foreseeable future.

The result is that political, macroeconomic, and structural issues suggest that actual U.S. risk is greater than that suggested by a AAA rating. That the U.S. can currently meet its debt service obligations does not change the long-term outlook, which is decidedly more pessimistic than a AAA rating would suggest. A ratings downgrade will likely further increase the cost of capital and further damp macroeconomic growth. In turn, that means an even more aggressive fiscal consolidation program will be required to address the nation's long-term imbalances and, in the short-term, economic headwinds could be even stronger in the U.S.
 
I blame GWB - after all, he left office >2.5 yrs ago.
I also blame the GOP-controlled Congress - after all, they lost power >4.5 years ago.
 
;)
There is nothing balanced or fair about what Obama is doing and he knows it.
LOL, yes -- Obama's adamant stand for "compromise" and "balance" has very little to do with meaningful policy changes and everything to do with the fact that such words poll well among independents. Stuff like this makes me laugh and then throw up a little bit in my mouth...

Obama: I think that we can get some cuts going and I’ve shown a lot of flexibility, as you know, George. I’ve been criticized pretty fiercely in my own party. Saying that I’ve been compromising too much.

As blatant as it is, you know this crap has a lot of people clapping and nodding their heads as they murmur to themselvs "that's right!". In fact, I'm willing to bet it resonates quite well with a good many of those DPrs who are constantly praised for their repeated, insightful "No, BOTH parties do it" proclamations (you know, the caps is crucial if you really want to get "Liked").

Yeah, both parties suck, both parties are corrupt, both parties are incompetent, both parties are stupid... if only people understood that at the center of all that sucky, corrupt, incompetent idiocy is the solution to all our problems. It's a bit like picking up an oozing, half-rotted orange caked in mold. Given how bad things look from the outside, very simple logic tells you that the good part of the orange must be in the middle. Only a blind partisan with no critical thinking skills could conclude otherwise. ;)
 
Only a few pages back you tried to place the entire blame on Obama and now you are criticizing Obama and all liberals for casting blame on others.

Sigh...you are truly a hopeless case. Partisan to the core. The fact that both parties and every president since Reagan is to blame for our current situation will never sink into your skull. One day, the light will hopefully turn on.

Hey, what are you doing posting in the grown up forums? :)


Tim-
 
I'm not arguing that such an outcome is acceptable to say the least. It isn't.

My point is that it is consistent with experience following recessions driven by housing busts. The extent of debt involved in the housing sector is enormous--indeed, at the height of the housing bubble, mortgage debt had briefly exceeded GDP. That debt will need to fall back toward more sustainable levels. Hence, household deleveraging remains underway. In turn, that deleveraging suppresses growth in personal consumption expenditures, which account for about 70% of U.S. GDP.

Following the end of the housing bubble, jobs that had existed in housing-related industries (mortgage finance, construction, etc.) will not return to previous levels anytime soon. That is a structural unemployment issue, as many from those industries cannot necessarily transition into new industries for which very different skillsets are required. In addition, given the intensity of global competition, many companies are not hiring the long-term unemployed out of concern that their skills are not up to date. That is also a structural issue. In short, both slow macroeconomic growth and structural unemployment issues will are leading to an anemic jobs recovery.

Longer-term, the nation faces very real challenges. IMO, it does not deserve a AAA rating.

1. Political dysfunctionality is a barrier. By political dysfunctionality, I mean that the nation's political leaders are unable to effectively reach agreements on tough issues related to fiscal consolidation. That raises medium- and long-term issues as to whether the U.S. can adopt a robust fiscal consolidation program to tackle its long-term imbalances, much less sustain such a program. Such a program won't be painless. It will, in the near-term, present an additional contractionary headwind.

2. Long-term macroeconomic outlook: The combination of current structural unemployment issues, relative decline in educational attainment, increased risk of a secular rise in the cost of capital, competitiveness gaps in key sectors, and lack of public-private investment in potential growth opportunities (energy to aerospace, etc.) suggest that the nation's long-term growth rate potential is less than it was in the past. 2.5% annualized growth over the next 10 years might be optimistic. 2.0% might be more realistic. That means less tax revenue growth.

3. Federal financial ratios, especially debt:GDP and debt:revenue have deteriorated. There is little evidence of a concrete program to address those issues. Political dysfunctionality reduces prospects of such a program.

4. States have enormous long-term fiscal problems. Despite balanced budget amendments in most states, state finances are weak in the long-term. The amendements have led to the illusion of balanced budgets only because the states significantly underfunded pension and health obligations. If the present value of changes in such obligations were required to be placed on the financial statements, most states would have been running chronic, significant budget deficits. Hence, the utility of such amendments is questionable at best.

5. Structural health system problems: Specifically, the excessive cost growth problem remains unresolved. U.s. health care costs continue to grow at a multiple of national income, even as a significant slice of the population lacks coverage, and one cannot reasonably expect foreigners to continue to finance the system. That multiple is well beyond what is explained by demographic change (population aging/life expectancy). Hospitals remain "inflation factories." Fundamental health reform to address those issues remains unlikely for the foreseeable future.

The result is that political, macroeconomic, and structural issues suggest that actual U.S. risk is greater than that suggested by a AAA rating. That the U.S. can currently meet its debt service obligations does not change the long-term outlook, which is decidedly more pessimistic than a AAA rating would suggest. A ratings downgrade will likely further increase the cost of capital and further damp macroeconomic growth. In turn, that means an even more aggressive fiscal consolidation program will be required to address the nation's long-term imbalances and, in the short-term, economic headwinds could be even stronger in the U.S.

Wasn't Obama hired to "clean up this mess?" What exactly has he done to improve the economic performance of this country and reverse that evil GW Bush who single handledly destroyed the economy as Democrats controlling the Congress watched. Wonder how many of those Democrats today are claiming that Republicans want Obama to fail so Republicans regain the WH? Amazing how little Congress plays when a Republican is in the WH and how bad the former GOP President made things 2 1/2 years after leaving office.
 
I blame GWB - after all, he left office >2.5 yrs ago.
I also blame the GOP-controlled Congress - after all, they lost power >4.5 years ago.

They've been in power for six months and since they've been there, GDP growth has slowed considerably. And unemployment has gone up.
 
All since Republicans took the house. What happened to their promise of jobs. They promised us that if we'd vote them in, they'd bring us jobs.

GDP growth Since the recession came to an end:

2009 Q4 - 3.8%
2010 Q1 - 3.9%
2010 Q2 - 3.7%
2010 Q3 - 2.5%
2010 Q4 - 2.3%

GDP growth Since Republicans took the House.

2011 Q1 - .4%
2011 Q2 - 1.3%

Unemployment rates from the end of the recession:

Peaked at 10.1%; dropped to 8.9% in February, 2011.

Since Republicans took the House.

Increased to 9.2%

And if trends keep up, the stock market will have lost all the gains it had made in 2011!

So, let's recap: GDP growth slowed since Republicans took over. Unemployment is up instead of down since Republicans took over. And all of our retirements are about to collapse because a bunch of freshmen signed their pledge of allegiance to Grover Norquist.


Hehehe^^^ You, what's really funny is that you are not even aware of the fail in this post?? Where do you suppose all that growth came from? And why do you suppsoe it's no longer growing? :)


Tim-
 
They've been in power for six months and since they've been there, GDP growth has slowed considerably. And unemployment has gone up.
Because I'm a nice guy and I don't want you to -so- terribly embarass yourself, I'll give you a chance to delete your post.
:rotfl:
 
Last edited:
They've been in power for six months and since they've been there, GDP growth has slowed considerably. And unemployment has gone up.

Do you understand that the fiscal year of the U.S. runs from October to Sept. and that first quarter GDP is Oct. 2010 to December 2010 and second qtr is January 2011-March 2011? Stop buying what you are told. Republicans didn't take control until January 2011 and did so with Democrats calling all GOP House legislation DOA
 
They are relatively close to what most economist expected. A -0.5% difference (1.8 - 1.3) isn't much to panic about. The economy's in the ballpark of analysist estimates.

no, the white house in the last federal budget passed into law forecast rosey growth rates of 4% for now and the foreseeable

Who's Obama Kidding? - Forbes.com

when gdp falls so short of budgetary expectations, deficits explode

the admin also relies on near-zero interest rates forever

which, when that expediency normalizes itself...
 
Do you understand that the fiscal year...
Do you understand that FFG is apparenly only interested in blamming Republicans, absolving Democrats and protecting The Obama?
That'e the only possible conclusion one can draw from his post.
 
Do you understand that FFG is apparenly only interested in blamming Republicans, absolving Democrats and protecting The Obama?
That'e the only possible conclusion one can draw from his post.

I heard Obama doesn't know how to ice skate.
 
Do you understand that FFG is apparenly only interested in blamming Republicans, absolving Democrats and protecting The Obama?
That'e the only possible conclusion one can draw from his post.

No, actually it's because several conservatives have said the recession was the fault of the Democrats being in Congress for a year-and-a-half when it occurred. So if it's the Democrats being in Congress at fault for the recession, the Republicans have to suck this one up and eat it.

However, the Republicans did say they would get us jobs if they were elected and so far they have not done so.

But they are trying to pass a bill that will still have our national credit rating downgraded, which will cause all Americans to pay higher interest rates, increase the debt we currently have and THEN force everyone back into the same death spiral again in six months.

That's responsible.
 
No, actually it's because several conservatives have said the recession was the fault of the Democrats being in Congress for a year-and-a-half when it occurred. So if it's the Democrats being in Congress at fault for the recession, the Republicans have to suck this one up and eat it.
Thank you for proving my point.
 
Do you understand that FFG is apparenly only interested in blamming Republicans, absolving Democrats and protecting The Obama?
That'e the only possible conclusion one can draw from his post.

Yep, there are a lot here like FFG, most seem to be very young, in school, and easily brainwashed. Obama and the liberal elite are laughing their asses off at these people.
 
It's not hard to believe at all. Jobs are outsourced. We don't produce as much as we used to. This coupled with gas prices being markedly higher shouldn't be a surprise to anyone.
At the same time, that's the activity that's keeping us afloat right now - businesses sitting on cash are modernizing and investing in infrastructure. This is good for the economy in the long term, but not for that segment of our population -- typically the uneducated portion -- who have been priced out of the job market. History tells us that those jobs ain't coming back.

Double whammy - not only do you not have a job, you're also the one most affected by all this massive borrowing currently contributing to our weaker dollar. You weren't making much of a living before, and now you're having to spend more on essentials (food, gas) and pretty soon clothing and a lot of other goods, the prices of which have been held artificially low by companies waiting for the economy to pick back up.
 
Thank you for proving my point.

What point? I'm not really saying that Republicans are directly responsible for this, but like Obama they promised miracles if people would vote for them.

And they didn't achieve them, did they?

But again, they are trying to pass a bill that will still ruin the US credit rating, increase the national debt, increase interest rates on working Americans, and force everyone back into the same boat we're in right now in just six months. What an incredibly responsible bill that is!
 
What point? I'm not really saying that Republicans are directly responsible for this, but like Obama they promised miracles if people would vote for them.

And they didn't achieve them, did they?

But again, they are trying to pass a bill that will still ruin the US credit rating, increase the national debt, increase interest rates on working Americans, and force everyone back into the same boat we're in right now in just six months. What an incredibly responsible bill that is!

Noticed that you ignored the fiscal year informaton regarding the Govt. Guess when proven wrong it is a lot easier to ignore the information hoping that if you say the same thing over and over enough that it eventually becomes true.
 
The uncertainty they have created by doing so has been devastating to consumer and lender confidence.

the uncertainty that has plagued this economy since the day obama swore in comes from the 2500 pages of wall street regulatory reform which even dick durbin has no idea all it says

uncertainty is the thousand pages of obamacare we had to pass to find out what's in it and from which thousands have subsequently been waived

the failure of the party in power with sixty senators and a plurality of 78 downstairs to settle before new years eve each american's precise relationship with his or her irs, per the extension or not of the bush tax cuts, left for lame duck

as for this debt ceiling debate, where's leadership

it'll take a short term deal, it won't take a short term deal, it'll veto it, it won't

it want's a clean lift, it wants 4T in cuts, it wants taxes now, it wants tax reform now, it wants tax reform later

cuts not, tax reform later

it wants social security cut except it's off the table

it wants the loopholes but it won't say which ones

it wants the biden group, the gang of six, the mcconnell plan, the mcconnell-reid plan, the reid plan...

vision, anyone?

steady hand?
 
Last edited:
Wasn't Obama hired to "clean up this mess?"

Exit polls indicated that the economy was the principal reason Senator Obama was elected President. Voters expected him to deal with the crisis that was underway at the time. Senator McCain's having panicked during the financial crisis doomed any prospects he had.

What exactly has he done to improve the economic performance of this country and reverse that evil GW Bush who single handledly destroyed the economy as Democrats controlling the Congress watched.

The financial crisis and ensuing recession were beyond the scope of President Bush's policies alone. The seeds for the financial crisis that resulted from the collapse of the housing bubble were planted well before President Bush came to office. Some of the seeds were policy-related. Many others were not e.g., technology/information developments made securitization on a large scale feasible. Bad risk assessment by the financial sector contributed.

Nonetheless, the adoption of Medicare Part D (a new costly entitlement program grafted on top of a program that was already structurally unsound), choice not to finance conflicts with a special tax/surcharge, and the 2001/2003 tax relief program (renewed in 2010) had fiscal implications. The 2009 fiscal stimulus program had some impact in slowing the deterioration in the job market/decline in GDP, but such a program merely borrows from future growth to create a less bad present. Political trade-offs led to its overall multiplier being lower than if a purely economic approach were pursued. In any case, stimulus has temporary short-term benefits that peter out once stimulus winds down. It is not a long-term jobs creation program.

The biggest failure has been the lack of a coherent and comprehensive economic growth/jobs strategy (especially when the type of recession that ensued created a larger structural unemployment problem than most other recessions). That situation will be a fair issue for debate during the 2012 election. Whether or not President Obama's Republican challenger will offer a credible package to fill that need remains to be seen. Voters will ultimately choose based on the situation going into the election and expectations going forward. If the unemployment rate has begun an appreciable decine, the President will very likely be re-elected. If not, then voters will choose the candidate whom they believe offers them the best prospects for meaningful job growth.

Wonder how many of those Democrats today are claiming that Republicans want Obama to fail so Republicans regain the WH? Amazing how little Congress plays when a Republican is in the WH and how bad the former GOP President made things 2 1/2 years after leaving office.

Voters will be looking ahead during the 2012 election. Political narratives about the past will matter little. An increasing problem is that the two parties increasingly view the situation as a zero-sum game (one can only gain at the other's expense). That perspective has greatly corroded the willingness to cooperate, even where vital national interests are at stake. That persepctive is part of the reason the nation's political risk is elevated beyond where it has been for quite some time. It is a compelling reason why confidence in the nation's policy makers and even political system is eroding, both among Americans and overseas U.S. partners.
 
Yep, there are a lot here like FFG, most seem to be very young, in school, and easily brainwashed. Obama and the liberal elite are laughing their asses off at these people.

What? You know jack **** about me. You can pretend you do, but that's just the stereotype that's been painted for you by too many years of listening to talk radio and watching your prescribed media. Should I just assume you live in your gated community with six cars, munching on caviar and carrying on an affair with a much younger woman who you keep on your yacht in South Beach?

I'm pissed off at Republicans at this particular moment because of the histrionics in the House. The whole thing is ridiculous. I had a back and forth with someone who is a conservative on here yesterday and in minutes we could basically find an agreement. But when you elect the great Orange one to be your speaker, all he can come up with is a bill that won't prevent the credit rating from being taken down, causing interest on the national debt and on average citizens who have car loans and credit cards to rise - all just to have the same arguments in six months.

It's a horribly irresponsible bill that cannot pass in the Senate or be signed, but they move forward with it anyway and the only reason he would do so is to attempt to gain political points while things come crashing down around us. Not saying that Obama isn't trying to game the system, because that's what all politicians do; but Boehner actually holds the key here and if he would create a bill (like Reid's) that is at least tolerable to the other side, we'd be done with this.

But he won't do it out of adherence to a class of freshmen who couldn't govern their way out of a hedge maze.
 
What? You know jack **** about me. You can pretend you do, but that's just the stereotype that's been painted for you by too many years of listening to talk radio and watching your prescribed media. Should I just assume you live in your gated community with six cars, munching on caviar and carrying on an affair with a much younger woman who you keep on your yacht in South Beach?
For the record, its 5 cars + 2 trucks, and I don't like caviar.

But he won't do it out of adherence to a class of freshmen who couldn't govern their way out of a hedge maze
Yeah. Damn those guys for doing what they were elected to do, and Boehner for recognizing this.
 
Back
Top Bottom