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