The past week has witnessed a flurry of good news, but encouraging reports on the economy did not come early enough to offset a gloomy outlook that seems to be settling over America.
First, the good news: The Gross Domestic Product grew 3.5 percent in the third quarter. Some economic experts were quick to hail, at long last, a loosening of the recessionary grip. But others pointed out that too much of this growth is predicated on the astoundingly sharp spike in motor vehicle output, courtesy of the Cash-for-Clunkers program.
Hence, it may oblige us to wait until more realistic fourth-quarter reports come in next January, reports reflecting the automotive market and holiday shopping data — to gain a more definitive outlook on our economic condition.
Nonetheless, on Monday the Commerce Department posted better-than-expected building figures for September. Instead of a 0.3 percent drop in total construction spending, as originally forecast, the industry number rose by 0.8 percent. Particularly portentous was a 3.9 percent rise in spending on residential construction.
So why all the gloomy faces, with 52 percent of those polled, according to a Wall Street Journal/NBC News polls taken Oct. 22-25, saying the country was headed down the wrong track. It’s the first time since Barack Obama took office that a majority answered this question negatively.
What’s more, 58 percent believe that the economy has not hit rock bottom. The GDP news from late last week may have buoyed some spirits, but, with unemployment well in excess of 9 percent, folks are taking a “micro” rather than a “macro” view of the economy. Which is totally understandable.
Perplexingly, the GOP has not capitalized politically in this atmosphere. Indeed, Republicans seem headed in the opposite direction. In September, when fewer Americans told the WSJ/NBC folks that the nation was on the wrong track, the GOP pulled within shouting distance of the Democrats, 43-40, in the congressional preference poll. Now, with a majority doubtful of America’s direction, Republicans have somehow managed to fall behind by eight points, 46-38, in terms of congressional preference.
This, we dare say, could be subject to change this month if Republicans can put a convincing health-care package on the table as an alternative to the massively multilayered bureaucratic mess-in-waiting put forth by the Democrats.