"Debt-ceiling compromise will do nothing to prevent the economy from tumbling into a 2nd recession"

[Better Believe It]

The Coming Double Dip: How DC Manufactures Recession
The debt-ceiling compromise will do nothing to prevent the economy from tumbling into a second recession.
by Annie Lowrey
August 2, 2011

About 14 million Americans are out of work. What does the last-minute deal to raise the debt ceiling do to aid the flagging, faltering economy? Nothing.

The economy is in appalling shape. Last week, the Commerce Department's latest estimate of economic growth left many economists agog. In the second quarter, the economy grew at an annual rate of 1.3 percent. In the first, it grew at an annual rate of just 0.4 percent, a figure revised down sharply from previous estimates. Based on the first six months of 2011, the economy is growing less than 1 percent per year, about one-third of the speed we would expect during a normal expansion. In short, the recovery has completely stalled and the economy is perilously close to double dipping back into recession.

Those horrid growth figures are magnified by horrible jobs figures. Currently, 14.1 million Americans are out of work. Millions more are underemployed, discouraged from hunting for jobs, or "missing" workers who have elected not to enter the labor market. Even if the economy suddenly starts growing at the pace of the 2002-07 expansion, the unemployment rate would not drop to its prerecession level of 5 percent until 2018.

But the debt deal pays no attention to the unfolding catastrophe in the real economy. The deal's major accomplishment, as touted by the White House, is hardly an accomplishment at all—merely an admission that Congress has probably avoided doing too much damage during this idiotic debate. "Independent analysts, economists, and ratings agencies have all made clear that a short-term debt limit increase would create unacceptable economic uncertainty by risking default again within only a matter of months and as stated, increase the chance of a downgrade," the White House noted. "By ensuring a debt limit increase of at least $2.1 trillion, this deal removes the specter of default, providing important certainty to our economy at a fragile moment." In other words, a round of applause: Congress has probably managed to shoo away the shadows that Congress itself cast.

http://www.commondreams.org/headline/2011/08/02-2Debt

[HereSince1628]

1. Actually, the unwillingness to borrow for a stimulus

guarantees there will be no jobs recovery.

[phantom power]

9. But no problem -- Biden assures us they're going to talk about nothing but jobs now!

What that empty bullshit promise means with nothing but budget cuts on the horizon remains a mystery.

:woohoo:

[kestrel91316]

2. Ahem, economists. WE ARE ALREADY IN THE SECOND DIP.

[AndyTiedye]

3. Our Alternatives Were

"tumbling into a 2nd recession" or diving into one nose-down at full power.

[TwilightGardener]

4. It wasn't intended to. It is a reaction to the declared intent to collapse our economy.

[CleanGreenFuture]

5. I believe that 1.3 percent growth figure is still subject to revision. So, it may be worse.

[Kolesar]

6. Uh, nobody claimed it was a "jobs bill" or anything like it

Unless you want to deconstruct some testes-baggers' arguments.

[dtexdem]

7. Well, sure, it will do nothing to prevent it -- but on the other hand ...

it will do a lot to ensure it.

[Remember Me]

8. 2nd recession hell -- try extended depression nt

[indepat]

10. The manufactured "debt ceiling crisis" compromise will do little but exacerbate every thing

wrong with the economy, albeit there's a bright side: the uber-wealthy and large corporations will continue slopping fervently at the public welfare teat. :patriot: