Politics

Third Straight Quarter of GDP Growth

By Karina

New data released today show the economy is moving forward?with GDP growing for the third straight quarter (at an annual rate of 3.2% in the first quarter of 2010) and consumer spending rising the most in three years:

AP, Consumer rebound gives economy solid boost in Q1:

The economy grew at a solid 3.2 percent pace during the first quarter of this year as consumers boosted their spending by the most in three years.

The Commerce Department’s initial estimate of the economy’s performance in the January-to-March quarter, released Friday, provided more evidence that the economy is strengthening. It marked the third straight quarterly gain as the United States heals from the longest and deepest recession since the 1930s?

Consumers rebounded and powered the first-quarter’s growth. They increased their spending at a 3.6 percent pace, the strongest showing since early 2007 ? before the economy tipped into a recession.

Congressional Republicans have voted against every major piece of economic legislation?from the Recovery Act to Wall Street reform?choosing the special interests over American workers, their families and small businesses. Where would the economy be now if they had prevailed?

Speaker Pelosi on today’s economic news:

One year after President Bush left our country mired in the most severe economic crisis since the Great Depression, today?s solid growth in GDP, driven by consumer spending, is a sign of progress for our economy and for the middle class.

Congressional Republicans fought this progress at every opportunity. Not a single House Republican stood up for economic recovery. Instead, they tried to obstruct progress for the American people ? siding with Wall Street over Main Street, insurance companies over America?s families, and Big Oil over small business.

Democratic leaders have worked to turn the tide in favor of Main Street. During the final full quarter of the Bush Administration, our economy shrank by 5.4 percent; today, it has expanded by 3.2 percent, marking the third consecutive quarter of growth. In January 2009 ? the last month of President Bush?s term in office ? we lost 779,000 jobs; last month, we gained 162,000 jobs.

America?s prosperity will be measured in good-paying jobs and economic security for our middle class. By every measure ? from tax cuts for 98 percent of Americans to job creation on the rise ? Democratic actions have advanced the interests of the middle class and small business owners. Meanwhile, congressional Republicans have fought for Wall Street, insurers, and Big Oil ? threatening to take us back to the Bush era of devastating job losses and a financial crisis that cost millions of families their homes, retirements, and savings.

More on the GDP news:

CNNMoney.com, Economy grows for third straight quarter:

Gross domestic product, the broadest measure of the nation’s economic activity, rose at a 3.2% annual rate in the quarter, the Commerce Department said?

The report marked the third straight quarter of growth, confirming the view of many economists that the recession that started in December 2007 ended at some point in the middle of last year.

Wall Street Journal, U.S. Economy Expands 3.2%:

The U.S. economy grew briskly in the first quarter, driven by businesses stocking up on goods for a strengthening consumer demand stoked by the lowest core inflation number in 51 years?

Consumer spending makes up about 70% of GDP, so it is a vital part of the economy in the U.S. With joblessness high, consumers have been a bit cowed during the economic recovery. But the labor market seems to be getting better — U.S. employers created jobs at the fastest pace in three years in March, recent government data said.

The 3.6% increase in consumer spending is the biggest since 3.7% in first-quarter 2007.

Bloomberg, U.S. Economy Expands as Consumer Spending Accelerates:

The U.S. economy expanded at a 3.2 percent annual rate in the first quarter as households spent more freely, setting the stage for gains in employment that may help the recovery broaden and accelerate.

Consumers may play a more prominent role in the recovery, increasing the odds of a sustained rebound, as growing sales at companies from General Electric Co. to Caterpillar Inc. promote hiring.

Read more about the GDP numbers from the Bureau of Economic Analysis»

Read Christina Romer, Chair of the Council of Economic Advisers, on the GDP growth»

Full post as published by The Gavel on April 30, 2010 (boomark / email).