Annual GDP grew just 1.7 percent, debt nearly larger than economy

Jan. 27, 2012, Fairfax, VA—Americans for Limited Government President Bill Wilson today issued the following statement reacting to the latest Gross Domestic Product (GDP) release by the Bureau of Economic Analysis:

“In 2011, the economy slowed down considerably to a tepid snail’s pace of 1.7 percent for the year. The housing bubble popped in August 2007, and the economy contracted in its aftermath. Here we are, four years later, and the economy is still very weak, unemployment remains unacceptably high, consumer inflation is still rising, and the cost of doing business in America remains among the highest in the developed world. Have we really turned the corner?

“Interestingly, the Bureau points to a slowdown of government spending in 2011 as leading the drop in GDP, even though at the federal level spending still increased last year. This proves that the ‘stimulus’ of 2009 and 2010 merely created some artificial demand for goods and services, which, once it ran out, did not create a virtuous cycle of growth as promised. The only thing that was apparently accomplished is that now the debt is nearly larger than the economy. Obama has failed.

“The Obama administration said ‘stimulus’ needed to be ‘timely, targeted, and temporary,’ and then all would be well. But because the underlying government-created problems in housing, the financial and monetary system, the burdensome regulatory environment, the restrictions on capital creation, and the highest corporate tax rate in the developed world remain unaddressed, all the spending, borrowing and printing produced was a temporary sugar high.

“This is the 1930’s all over again, when, no matter how much borrowing, spending, and printing the government did, the economic doldrums persisted through the decade, and meanwhile, government became considerably larger. It is time for a new way forward that will address the supply side of the equation and reduce the cost of doing business stateside, which is the only long-term solution to sustainably grow the economy and create new jobs. We need real growth, not more debt.”

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Obama’s Misleading 3 Million Jobs Created Claim

By Bill Wilson

In the State of the Union Address, Barack Obama attempted to convince the American people that the economy has turned the corner, things are getting better, and “we’ve come too far to turn back now.”

Reading Obama’s speech carefully, he noted the 8 million jobs that have overall been lost in the recession.

Then, he painted a rosy portrait by saying, “In the last 22 months, businesses have created more than 3 million jobs.” But he’s comparing apples and oranges.

There is a distinction between the Bureau of Labor Statistics’ (BLS) measurement of private sector jobs in the establishment survey and the overall jobs picture in the household survey. For obvious reasons, the narrower establishment survey does not catch everything. But most Americans who heard the speech probably thought Obama was saying the economy had created 3 million jobs overall since Feb. 2010.

It was a distinction Obama again failed to make on Jan. 25, a day later, on the campaign trail in Iowa. Then, he said, “We have created 3 million jobs over the last 22 months.” Again, implying the economy has created more jobs than it actually has. However?

According to BLS, since Feb. 2010, when Obama starts measuring his claim that 3 million jobs were created, the amount of people employed has only increased from 138.66 million to 140.79 million, a net increase of only 2.13 million. While that sounds nice, that is a pace of just 96,000 a month, which does not even keep up with the growth of the population — which grew at a pace of 163,000 a month — let alone replace the 8 million jobs that were lost in the recession.

That means, when population growth and the loss of 4 million working age adults from the labor force who have simply stopped looking for work are fully taken into account, the unemployment situation has not improved at all.

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Waiting for an Anti-Newt

By David Bozeman

As a political junkie, my biggest wish was always for someone to put elite-media commentators and debate moderators in their place. Now that Juan Williams and John King have both been savaged by the agile tongue of the great anti-Romney, I solemnly ask — is it too late to take that wish back?

A bold, even audacious conservative statesman is certainly long overdue. Speaker Newt Gingrich's outbursts, refreshing at first, now bear the mark of grandstanding, not unlike the proverbial snake oil salesman who has perfected his pitch and finally captured the crowd (and their pocketbooks). Discourse that was meant to be Reagan-esque now sounds calculated and predictable.

As long as Romney held front-runner status, he constantly wrestled with such charges as “conservative-lite” and, most notably, “flip-flopper.” Now that the momentum has shifted back to Newt, he should have to, and just as often, defend his tenure at Freddie Mac, his support of President Bush's prescription drug bill, his own calls for individual health insurance mandates, his frequent claims of man-made global warming and his support of the ultra-liberal Republican Dede Scozzafava in a New York US congressional race over Tea Party favorite Douglas Hoffman. As a loyal debate viewer, watching Mitt flounder on stage, defending Romney-care, has grown tedious. We know the deal by now. It's your turn in the hot seat, Newt.

Sometime in the late 1990’s, I bought the Speaker's To Renew America from a local bookstore's discount bin. Published in 1995, just after he assumed the House speakership in a Republican landslide, Renew is a good, though generic, conservative blueprint for America in the 20th Century. It was recently headed for my local charity store for a donation when I decided a quick perusal might be in order, given that Newt may be the only man standing between Obama and a second term. On Page 36, discussing American military resolve, Gingrich refers to FDR as "probably the greatest president of the 20th Century."

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ALG Editor’s Note: In the following featured story from the Wall Street Journal, House Republicans want to pull $100 billion of funding from the International Monetary Fund that is being used to bail out Europe, and Americans for Limited Government is still awaiting a response to its Freedom of Information Act Request to find out where the funds are going:

U.S. Republicans Gearing Up To Stop Funding IMF Bailout Of Euro Zone

By Ian Talley

WASHINGTON (Dow Jones)--Republicans are gearing up their political machinery to prevent a U.S. rescue of the euro zone as the International Monetary Fund is pushing to bulk up its resource base to more than $1 trillion.

Senior House GOP lawmakers Wednesday pressed the administration to assure Congress it isn't planning to contribute any taxpayer money to bail out ailing European economies. Many of the same lawmakers are backing legislation to pull back a $100 billion emergency loan by the U.S. the IMF in 2009 currently being used to finance bailout programs.

It is unlikely the lawmakers will be able to rescind the 2009 loan. But there is a strong chance they can block Treasury's plan to use the money to deliver on its promise to double the fund's normal resource base. Republicans could also prevent the administration from contributing to the IMF's new money push…

Bill Wilson, President of Americans for Limited Government, said his group has filed an appeal for a Freedom of Information Act request for more information on the use of U.S. money for euro-zone financing.

Wilson said the appeal was necessary because Treasury hadn't yet fully responded to the request.

"We'd like to know if there was a discussion for it to be used in Spain or Italy," Wilson said. "There's no way they're going to be able to produce enough money to be able to bailout some of these countries, and by extending these loans, in effect, you are putting the U.S. taxpayers on the hook for that country's sovereign debt."

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