Like most Americans, I’m confused by our economy. But I have to admit, last week stretched even my limited bandwidth for understanding our weak economy. For a nation wracked with 8.2 percent unemployment and headed toward a fiscal cliff, there were dollops of good news that belie the economic pain millions are experiencing.
Tuesday, June 12
On page A13 of The Post, a story about health-cost burdens for states contained this hopeful nugget. “States are finally seeing a bit of revenue growth in a turnaround from the economic downturn that devastated budgets in fiscal 2009 and 2010, according to a survey by the National Governors Association (NGA) and the National Association of State Budget Officers (NASBO),” wrote The Post’s Michael Fletcher.
Thursday, June 14
The New York Times ran a story on consumer data from the Commerce Department. There was barely an increase in spending due to “weak job creation and paltry wage increases.” Nevertheless, “Americans did spend more on big purchases,” such as cars and furniture. And gas prices have plummeted. “The average national price for a gallon of gas was $3.54 Wednesday, 40 cents cheaper than the year’s peak price in early April,” The Times reported. This is great news.
Friday, June 15
On page A24 of The Post, Brady Dennis wrote, “Home sales up. Inventories down. Prices rising in many cities. New houses being built at the fastest pace in years. Interest rates hovering at historic lows. A vibrant rental market.” In a Bloomberg News story on the very next page about home equity rising to its highest levels since 2008, Kathleen M. Howley had a one-sentence lede: “Americans are digging themselves out of mortgage debt.”
Saturday, June 16
Floyd Norris at the New York Times put the slow recovery in the U.S. into perspective. “Of the 14” countries that include the Group of 7 nations and seven others that use the euro, Norris wrote, “the United States is the only one to show consistent growth over the most recent four quarters. It has reported a growing economy for 11 consecutive quarters, even if the pace of growth has not been very fast.” More importantly, Norris noted, “The American economy, adjusted for inflation, was 1.2 percent larger in the first quarter of this year than it was in the peak quarter before the recession.”
But on the next page, “Dip in manufacturing suggests a stalled U.S. economy,” splashed some cold water on all this good news. “Hiring by the nation’s employers has slowed for four consecutive months, while retail sales contracted in May and new applications for jobless benefits have risen in five of the last six weeks.”
This story hit close to home for the millions of Americans who are still looking for work. And it was a near-perfect bookend for a week that started with an abysmal report from the Federal Reserve. “[T]he net worth of families plunged 39 percent in just three years, from $126,400 in 2007 to $77,300 in 2010,” The Post reported.“That puts Americans roughly on par with where they were in 1992.” Or, as the New York Times reported, the 2008 economic crisis “eras[ed] almost two decades of accumulated prosperity.”
So, given all that, maybe I understand what’s happening after all. Slowly but surely it appears as though things are getting better. It’s just that the hole we’re climbing out of is incredibly deep.