3:17 pm CST - January 31, 2013
Posted under The Scoop
By Conn Carroll
Unfortunately for Obama some rather inconvenient facts are getting in the way of his preferred political narrative. Yesterday, the Commerce Department released their advance estimate of economic growth for the 4th quarter of fiscal year 2012 and the news was not good: the economy shrunk by .1 percent.
Shocked by the unexpected news Obama’s supporters couldn’t decide how best to respond. Democratic Party Communications Director Brad Woodhouse tried to find a silver lining in the report, tweeting out one economists claim that this was “The best-looking contraction in U.S. GDP you’ll ever see.”
Ashworth, and many other liberals, noted that while the private sector economy actually added 1.2 percent to economic growth, a huge reduction in defense spending led shrank the economy by 1.3 percent. Never mind the fact that even 1.2 percent is far from the levels of economic growth needed to sustain the federal government surging entitlement spending obligations.
Later in the day, White House Press Secretary Jay Carney minced no words about who was to blame for this “best-looking contraction,” telling the White House press corps: “Our economy is facing a major headwind, which goes to your point, and that’s Republicans in Congress. Talk about letting the sequester kick in as though that were an acceptable thing belies where Republicans were on this issue not that long ago, and it makes clear again that this is sort of political brinksmanship of the kind that results in one primary victim, and that’s American taxpayers, the American middle class.”
Except, as Bob Woodward documented in his book The Price of Politics, the defense sequester not only was the White House’s idea, but they are the one’s who insisted it be part of the 2011 Budget Control Act. And don’t forget that cutting defense spending has been a major goal of the Obama administration from day one. In fact, at this time last year, Obama was trumpeting his efforts to cut defense spending by $487 billion over the next decade. It takes a lot of audacity to fight for defense cuts one year and then blame the other party for the economic affect of those cuts the next.
And the economy could get weaker from here. Remember, Obama also insisted on a $600 billion tax hike this January. That is going to have an impact on economic growth, as is the expiration of the payroll tax cut which has already sent consumer confidence plummeting.