AmSpin, you and Dizzie make quite a pair. Together, you know about as much about economics as my dog.
You say "Much of Bush's growth is war/debt spending.
Dizzie says the consumer isn't participating, so the reported GDP growth is "fake" growth.
Let's look at the facts.
Q3 GDP growth was recently reported at 8.2% (real $). How much do you think federal government spending contributed to that? Nope, it was zip, zilch, nada. Fed spending dropped 0.4%. Spending on defense dropped more, BTW - 1.6%.
Zero points for you. How'd Dizzie do?
Well, the 70-80% chunk of the economy she said isn't participating, measured by "personal consumption expenditures", seems to be hoppin'. PCE for Q3 were up 6.4%. Within that, BTW, durable goods spending was up a whopping 26.5% while non-durables rose 7.6%. Unfortunately for Dizzie's waiter friends, though, services spending by consumers rose only 2.1% - perhaps this is another case of Dizzie measuring the economy through a survey of her friends.
I'm afraid Dizzie gets a zero as well.
Oh, and if you or she want to know what businesses are doing, look at the "nonresidential fixed investment" component of GDP. That spending category jumped by 14%, the fastest growth since the bubble days of Q1 2000. And investment in equipment and software leaped ahead 18.2%, almost 3% faster than Q1 2000. Businesses ARE investing again, which bodes well for jobs and future PCE, BTW. It's a "trickle down" thing, you know.
One last note - in Q3, exports rose by 11% while imports rose only 1.5%. Within that, services exports rose by $11.7 billion ('96 dollars, annual rate) over the last two quarters while services imports rose by only $1.8 billion. Our annualized trade surplus on services grew by almost $10 billion since Q1 to $82.7 (real dollar basis, again). So much for Dizzie's theory that "offshoring" is ruining our economy.
I guess I have to take extra points away, leaving Dizzie in negative territory. So sorry.
PS: I don't have a dog. |
