Bacon's Rebellion

Democracy Thrives in Sunlight

The Porridge-Too-Cold Economy

—

by

James A. Bacon
in

Back in January Harvard economist Paul Krugman wrote that the U.S. enjoys a “Goldilocks” economy where “where “growth, inflation, and unemployment are all at levels that look “just right.” Well, the Bureau of Labor Statistics has released 1st-quarter numbers for the Gross Domestic Product, and it turns out economic growth nationally was 1.4%.

Remember, the federal deficit as a percentage of the GDP was 6.1% in fiscal 2024, which ended June 30. Six-percent deficits to buy 1.4% economic growth is not fiscally sustainable. This looks more like a porridge-too-cold economy to me.

If this is Goldilocks, I’ll take the three bears.

Fortunately, the numbers look a little better for Virginia. The Old Dominion’s economy grew at a 2.1% rate in the first quarter. We’re growing slower than our peers on the South Atlantic Coast, but at least we’re growing faster than the national average.

It would be a mistake to put too much stock in a single quarter’s economic performance. States’ economic numbers fluctuate quarter-to-quarter, varying due to the fluctuating fortunes of particular industries (agriculture, mining, manufacturing, federal government) as much than a state’s underlying economic competitiveness. But Virginia has been mired in economic mediocrity for years, and I’m grateful for any sign that we’re outperforming the anemic, unsustainable U.S. economy.

— JAB

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Comments

21 responses to “The Porridge-Too-Cold Economy”

  1. Lefty665 Avatar
    Lefty665

    Interesting that Krugman's view differs from the Fed's in that he thinks that inflation at close to twice the Fed's target rate is "just right". But then he was in the tank for Hillary in '08 and '16 too so his judgement is clearly flawed in many respects.

  2. Lefty665 Avatar
    Lefty665

    Interesting that Krugman's view differs from the Fed's in that he thinks that inflation at close to twice the Fed's target rate is "just right". But then he was in the tank for Hillary in '08 and '16 too so his judgement is clearly flawed in many respects.

  3. Teddy007 Avatar
    Teddy007

    Don;t worry, the next Trump administraiton will pass another debt finance tax cut and everything will be better except for the $1 trillion annual debt service that is now built into the federal budget.

    Who knows whether higher tariffs or green cards for everyone will be better for the economy? Or maybe everyone will read the Ten Commandments and decide to work harder.

    1. Lefty665 Avatar
      Lefty665

      Dunno if that's any better or worse than Dems huge deficit spending and insistence that men can have babies. Surely America as la la land with both parties was not our founders dream.

      Personally we're reading from 1st documents tomorrow, the Declaration, Constitution and Thomas Payne.

      1. Teddy007 Avatar
        Teddy007

        One may want to read the Project 2525 to see about the future. And the question to ask yourself is how can a president not be keep off a ballot for violating something mentioned in the Constitution but is given immunity for criminal acts based upon something not written in the Constitution.

        1. Lefty665 Avatar
          Lefty665

          It is not immunity for criminal acts as President. Impeachment by the Congress is the Constitutional remedy for presidential crimes and misdemeanors, not the judicial system after a president leaves office. The remedy is written expressly in the Constitution, and for exactly the reasons the court based its opinion on.

          Trump has never been charged with or convicted of insurrection, and we do have a presumption of innocence. His impeachment for those made up issues failed. There is no justification for keeping him off the ballot which the Court also explicitly found. The wisdom of electing him is a different question.

          Dementia is a Constitutional reason to remove a president from authority. That remedy is described in the 25th amendment.

          In our system the Supreme Court is the final arbiter of law and the Constitution. It has been that way since Marbury v Madison in 1803.

          There's your lesson for today. Hope it helps you grow up. But, I'm not holding my breath.

          1. Teddy007 Avatar
            Teddy007

            But the Republicans declined to impeach Trump saying that the courts could handle it. The Republicans on the Supreme Court have said, no, the courts can do nothing about crimes committed while president. And now Trump cannot be convicted of insurrection since the Supreme Court took that away from the courts. In reality, the Supreme Court has legalized bribery since a former president cannot be prosecuted for bribery since the appointment is an official act.

          2. Lefty665 Avatar
            Lefty665

            I encourage you to spend Independence Day reading the Declaration and the Constitution. Perhaps that will help you get shed of your delusions. None of what you have said has any basis in reality. Grow up.

            Happy 4th of July;

          3. Teddy007 Avatar
            Teddy007

            I suggest one also do it. From the 14th amendment: No person shall be a Senator or Representative in Congress, or elector of President and Vice-President, or hold any office, civil or military, under the United States, or under any State, who, having previously taken an oath, as a member of Congress, or as an officer of the United States, or as a member of any State legislature, or as an executive or judicial officer of any State, to support the Constitution of the United States, shall have engaged in insurrection or rebellion against the same, or given aid or comfort to the enemies thereof.

          4. Lefty665 Avatar
            Lefty665

            For the third time I remind you that Trump has never even been charged with insurrection. So he cannot be disqualified for it, despite your unhinged opinion.

            Your assertion has no Constitutional standing. Please try to pay attention. I am glad you have figured out that there are amendments to our Constitution, that is a big step in your education. Next step is understanding what they mean, that may be a steeper climb.

            If you don't want Trump as President again you should be helping the Dementocrats retire demented old Joe and Giggles and nominate real candidates. Otherwise, despite your ranting about insurrection, Trump is going to be elected (80% of voters say demented old Joe is too old), and with down ballot coattails that decimate Dementocrats. Along with Trump that will bring in Repub majorities, perhaps large ones, in both houses of Congress. That may not make you happy either. I encourage you to get a clue and spend your time doing something constructive.

            Happy Independence Day.

          5. Matt Adams Avatar
            Matt Adams

            You are truly wasting your breath, he lacks the ability to get past talking points and think logically.

  4. Nancy Naive Avatar
    Nancy Naive

    “If this is Goldilocks, I’ll take the three bears.”

    You did. 2017 to 2020.

    1. LarrytheG Avatar
      LarrytheG

      indeed! And compare to others! https://uploads.disquscdn.com/images/5891be38aec76757d1a436da4b70c4b34db869649fbdc957d7f30c38ef8b63b0.png

    2. kls Avatar
      kls

      1.4% inflation, $2.40/gal gas, no Russian invasions, no Iranian attacks like 10-7, the 300+ missile strike, the maritime war with the Houthis, no mass invasion of criminal foreigners from the Southern border…. yeah, i remember.

      1. Nancy Naive Avatar
        Nancy Naive

        Take any indicator and it’s chart, draw a straight line from Dec. 2019 to January 2022, and it’s all pretty much in the noise. The two real outliers are jobs added and inflation.

      2. Eric the half a troll Avatar
        Eric the half a troll

        1.4% GDP growth is not 1.4% inflation. Not the same thing at all. Inflation was 0% last month.

  5. f/k/a_tmtfairfax Avatar
    f/k/a_tmtfairfax

    Krugman is right up there with Joe & Mika and the Post's editorial board. They are bound and determined to hammer at the public until they surrender and agree that the economy has been great since January 20, 2021. But too many people simply cannot get beyond what they experience at the grocery store, the drug store, the hardware store or the gas station. How dare they?

  6. Eric the half a troll Avatar
    Eric the half a troll

    “Remember, the federal deficit as a percentage of the GDP was 6.1% in fiscal 2024, which ended June 30. Six-percent deficits to buy 1.4% economic growth is not fiscally sustainable.”

    Ummm… you are comparing annual deficit figures to quarterly growth rate.

    1. LarrytheG Avatar
      LarrytheG

      an interesting metric for sure!

    2. Teddy007 Avatar
      Teddy007

      The fiscal year ends at the end of September. We are still in FY24.

  7. LarrytheG Avatar
    LarrytheG

    Re: Virginia …. and California:

    "California remains the 5th largest economy in the world. California is the 5th largest economy in the world for the seventh consecutive year, with a nominal GDP of nearly $3.9 trillion in 2023 and a growth rate of 6.1% since the year prior, according to the U.S. Bureau of Economic Analysis. California’s per capita GDP is the second largest amongst large economies.

    The state created more than 28,000 jobs in March. California added 28,300 new jobs last month – the state’s seventh job gain in the last eight months, while seven of the state’s major industry sectors gained jobs.

    California, which has the most equitable tax system in the entire country, is #1 in the nation for new business starts, #1 for access to venture capital funding, and #1 for tourism spending."

    https://www.gov.ca.gov/2024/04/19/californias-strong-economic-week/#:~:text=California%20remains%20the%205th%20largest,Analysis.%20California's%20per%20capita%20GDP

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