GDP etc. in a deep funk

By the way, here’s a graph of actual real U.S. GDP and its major components relative to their long-term (1970–2007) trendlines through the end of 2013. Note how things fell off a cliff in the recession. GDP, consumption, and government spending are all about 15% below where they’d be had they continued to grow in line with their long-term trend. (The hysteria over out-of-control government spending looks ludicrous in the light of this graph.) Investment is about 25% below where it “should” be. thanks largely to the housing collapse, though it’s staging… Read More

GDP revisions: not a conspiracy, Jack

The irrepressible Jack Rasmus, who never tires of displaying his ignorance, has a piece up on Counterpunch (“Economic Recovery by Statistical Manipulation”) on the recent revisions to the U.S. national income and product accounts (NIPAs). No doubt speaking for legions of paranoids, left and otherwise, Rasmus describes the revisions as yet another politically driven scheme to make the economy look better than it is—“rewrit[ing] the numbers to make the failure ‘go away.‘” They’re not, and they don’t. Like almost all economic stats, the national income numbers—GDP and its supporting cast—are revised frequently… Read More