Let’s see, what’s on the business section today? Well, it looks like the May jobs report is going to be awful; the manufacturing sector has slowed to its lowest level in 20 months; the housing market is royally screwed; Europe is stuck; China’s economy is cooling; and the Dow Jones is down about 200 points this afternoon.
Oh, and economic forecasters can’t seem to lower their projections for quarterly growth fast enough.
How tepid is the U.S. economy? So lukewarm that economists at Goldman Sachs last week cut their economic growth forecast for the second time in a month, only to warn a few days later that “we already see downside risk to that estimate.”
Goldman now sees the U.S. economy struggling to limp forth at a 3% pace in the second quarter, down from 3.5% just three weeks ago and 4% at the start of the year.
Despite all of this, congressional Republicans won’t even allow the possibility of a discussion on giving the economy a boost. Instead, the only debate that’s permitted in Washington right now is over how much policymakers can take out of the economy, shifting the focus away from jobs and growth and towards debt reduction.
The media will, of course, continue to cheer them on. Dana Milbank proclaimed this morning that “there’s general agreement that the most pressing issue facing the federal government is its runaway finances.”
General agreement among whom?
Our fragile economic recovery appears to be cracking. If only someone in Washington appeared to care, I won’t be quite so nervous about it.
Update: Soon after posting this, JPMorgan lowered its quarterly forecast to an awful 2%. But thanks to Congress, any kind of stimulus is off the table.