“I’d give him an ‘A’. I don’t think he gets the credit he deserves for saving our economy from falling into a great depression, for saving the auto industry which represents millions of jobs up and down the supply chain, for beginning the crackdown on Wall Street abuses with Dod-Frank, for getting the Affordable Care Act passed, for really being as responsive as he could possibly be given the obstructionism that he faced with Republicans in Congress,” – Hillary Clinton in 2015
And yet here we are, a full seven years after the recession scraping and clawing to avoid yet another recession. Last week headlines blared that gross domestic product grew at a sickly 1.2 percent annual rate in the second quarter, less than half of economists’ expectations. “Disappointing,” said the Wall Street Journal. “Surprisingly anemic,” read the Los Angeles Times. “GDP Bust,” declared Barrons. “Shocker,” exclaims ZeroHedge.
The Commerce Department also downwardly revised first-quarter growth to 0.8 percent from a previous estimate of 1.1 percent. They also revised the fourth quarter down from 1.4 to 0.9 percent. Taken together, economic growth is now tracking at 1 percent annual growth, the weakest start to a year since 2011. The Washington Post reports:
The U.S. economy grew at a sluggish 1.2 percent pace in the second quarter, according to government data released Friday morning, as businesses cut back on investments and dashed hopes for what economists had expected to be a major bounce back.
The latest data shows an economy pulled in two directions, powered by fast-spending consumers but held back by anxious companies responding to a strong dollar and turmoil overseas.
Tepid growth between the months of April and June was particularly unsettling because it extended a period in which the economy appears to be gradually shifting into a lower speed. For three consecutive quarters, the gross domestic product growth — the broadest measure of output — hasn’t topped 1 to 1.2 percent. The nation hasn’t seen such a meager stretch since 2009.
That rate of growth isn’t just bad , it’s historically bad.
“In terms of average annual growth, the pace of expansion has been by far the weakest of any since 1949,” Eric Morath writes for the Wall Street Journal. “The economy has grown at a 2.1 percent annual rate since the U.S. recovery began in mid-2009, according to gross-domestic product data the Commerce Department released Friday.”
Sadly, that wasn’t the only bad news.
The Census Bureau released a report showing that the nation’s homeownership rate fell to an all-time low of 62.9 percent in the second quarter. What’s more, the drop in homeownership rates is largely because millennials are suffering through the lowest ownership rate for their age group in history, the result of historically high student loan debt burdens and a poor job market.
If that wasn’t enough, factory orders—a crucial economic indicator—fell in June by the largest amount in two years. The shipment of core capital goods, which is used to calculate equipment spending in the GDP measurement, fell 0.4 percent. U.S. manufacturing slowed by 0.6 percent. Construction spending declined by 0.6 percent to its lowest level since June 2015. And business inventories fell by $8.1 billion – the first quarterly drop in nearly five years.
You can bet that Hillary Clinton, who has thrown her lot in with President Obama’s economic policies and lashed herself to his legacy, isn’t feeling too confident right about now. As Ed Rogers writes for the Washington Post:
Notwithstanding all the happy talk about the economy from the Democrats, Gallup found that 60 percent of Americans think economic conditions in this country are “getting worse.” That’s 60 percent of people who will be resistant to Clinton’s economic plans. Americans can see what is happening. The typical American might not be able to quote statistics about how if the labor force participation rate were the same today as it was when Obama took office, the unemployment rate would be 9.2 percent instead of 4.9 percent or rattle off statistics about the decline in median household income under President Obama, but they can tell you firsthand about small businesses that have closed in their communities, friends who can’t find work, and their own financial struggles. And nothing they hear from Clinton makes them believe things are going to get better.
That’s because Hillary Clinton is talking about throwing more money into the same policies that have led to this anemic growth. In fact, she plans on putting those policies on steroids. After all, there is a reason that Bernie Sanders happily gloated that this is “the most progressive platform in the history of the Democratic Party.”
Americans don’t want a “progressive” platform. Frankly, they don’t even want a “conservative” platform. When it comes down to brass tacks, they don’t care about labels. They want results and that’s something that Democrats haven’t delivered.