First quarter real GDP growth keeps getting smaller.
The first estimates put growth at 3.2 percent. That’s not bad, especially coming after real growth of 5.6% in the fourth quarter of 2009. Maybe a solid recovery was under way.
But the second estimate put real growth at 3.0% in the first quarter. Still, not bad.
And now this morning, the third estimate put first quarter real growth at only 2.7%. Well, that’s below the average growth rate over the past six decades, and is particularly sluggish during the early stage of a recovery.
Should we expect a solid, robust recovery looking ahead? Hardly. The real threat is how much the economy is going to slow. Why? Quite simple, really: Government is doing everything it can in terms of running up taxes, regulation, and spending, and that will slow down the economy in both the short run and over the long haul.
Raymond J. Keating
Chief Economist
Small Business & Entrepreneurship Council
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