The Economy Is Even More Sluggish Than We Thought

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And now for some bad news. In April, the BEA announced that GDP had grown 2.5 percent in the first quarter of the year. Not great, but not too bad. At the end of May, that was revised down a tick to 2.4 percent. Today, in its final estimate, the hammer was dropped:

The U.S. economy grew at a slower pace than previously estimated in the first quarter as consumer spending and business investment were revised sharply downward, amid signs the pace of growth is likely to have slowed in recent months.

The nation’s gross domestic product, the broadest measure of all goods and services produced in the economy, grew at a 1.8% annual rate from January through March….The first quarter’s revision was due largely to personal consumption expenditures that notched lower to a 2.6% gain from 3.4%. Consumer spending, which accounts for two-thirds of economic output, largely drove overall gains in the first three months of the year.

So, that economic recovery that you thought was proceeding pretty sluggishly? Well, it’s proceeding even more sluggishly than you thought. Apparently the fiscal cliff had a pretty big effect after all. I can’t wait to see how the sequester affected second quarter growth.

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DEMOCRACY DOES NOT EXIST...

without free and fair elections, a vigorous free press, and engaged citizens to reclaim power from those who abuse it.

In this election year unlike any other—against a backdrop of a pandemic, an economic crisis, racial reckoning, and so much daily crazy—Mother Jones' journalism is driven by one simple question: Will America move closer to, or further from, justice and equity in the years to come?

If you're able to, please join us in this mission with a donation today. Our reporting right now is focused on voting rights and election security, corruption, disinformation, racial and gender equity, and the climate crisis. We can’t do it without the support of readers like you, and we need to give it everything we've got between now and November. Thank you.

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