The U.S. economy added 252,000 jobs last month while the unemployment rate dipped to 5.6%, the Wall Street Journal reports.
Wonk Wire: Standard of living index reaches new high
Senate Majority Leader Mitch McConnell (R-KY) claimed the economy is improving because Americans know Republicans are in control of Capitol Hill.
Said McConnell: “After so many years of sluggish growth, we’re finally starting to see some economic data that can provide a glimmer of hope; the uptick appears to coincide with the biggest political change of the Obama administration’s long tenure in Washington: the expectation of a new Republican Congress. So this is precisely the right time to advance a positive, pro-growth agenda.”
First Read: “So after years of making President Obama and Democrats own the state of the economy, McConnell is now taking credit for the improving — two days into his new job? And based on the expectation that the GOP was going to take over the Senate? If anything, this is a reminder that the Republican Party realizes that — if the economy continues to get better and better — they can’t allow Obama to get all of the credit. Oh, and we get a new monthly jobs report tomorrow.”
Sen. Elizabeth Warren (D-MA) delivered a stinging critique of Republicans and Democrats alike in a speech “that said policies pushed by both parties have created financial hardships for everyday families while further enriching a narrow sliver of Americans,” the Wall Street Journal reports.
Said Warren: “Pretty much the whole Republican Party—and, if we’re going to be honest, too many Democrats—talked about the evils of ’big government’ and called for deregulation. It sounded good, but it was really about tying the hands of regulators and turning loose big banks and giant international corporations to do whatever they wanted to do—turning them loose to rig the markets and reduce competition, to outsource more jobs, to load up on more risks and hide behind taxpayer guarantees, to sell more mortgages and credit cards that cheated people. In short, to do whatever juiced short-term profits even if it came at the expense of working families.”
A new Gallup survey finds that concerns over the functioning of government tops the list of America’s concerns, beating out the economy.
2014 was also the first year since 2007 that the economy was not the top ranking issue.
“States dependent on oil and gas revenue are bracing for layoffs, slashing agency budgets and growing increasingly anxious about the ripple effect that falling oil prices may have on their local economies,” the New York Times reports.
“The concerns are cutting across traditional oil states like Texas, Louisiana, Oklahoma and Alaska as well as those like North Dakota that are benefiting from the nation’s latest energy boom.”
“When will the improving American economy translate into higher approval ratings for President Obama? It will take time. But if recent trends continue, Mr. Obama’s political standing is likely to strengthen,” Brendan Nyhan reports.
“The lesson of history is that Mr. Obama will get credit if growth continues, but we should not be surprised if public opinion lags objective measures of the economy… We can see this process of the public starting to notice improvements in the economy in recent survey data.”
Write political scientists Peter Enns and Gregory McAvoy: “For the most part, public opinion does not react instantaneously to changes in economic information. It takes time for economic news to make its way from government reports into news reports so that ordinary citizens can absorb and respond to this information.”
“President Obama is preparing a major push on trade that seeks to enlist Republicans as partners and test his premise that Washington can still find common ground on major initiatives, even after he angered the GOP with a recent slew of executive actions,” the Washington Post reports.
“It also will test his willingness to buck his own party in pursuit of a legacy-burnishing achievement. Already, Obama is facing fierce blowback from fellow Democrats, who are accusing him of abandoning past promises on trade and potentially undermining his domestic priority of reducing income inequality.”
“After years of muddling along, the U.S. economy appears to be breaking into a sprint that could alter the political landscape heading into 2015 and beyond,” Politico reports.
“The latest evidence of strength came in a report on Tuesday showing growth expanded at a robust 5 percent pace in the third quarter of 2014, the fastest speed in over a decade. The news helped drive the Dow Jones Industrial Average above 18,000 for the first time ever in a bull market charge that began six years ago and shows no signs of slowing.”
“The U.S. economy posted its strongest growth in more than a decade during the third quarter, supported by robust consumer spending and business investment,” the Wall Street Journal reports.
“Gross domestic product, the broadest measure of goods and services produced across the economy, grew at a seasonally adjusted annual rate of 5.0% in the third quarter… That was up from the second quarter’s growth rate of 4.6% and the strongest pace since the third quarter of 2003.”
“Six years after President George W. Bush began the auto bailout, the Obama administration on Friday declared a profitable end to the sweeping federal interventions in Wall Street and Detroit, saying a final sale of stock from General Motors’ former finance arm had closed a turbulent chapter of the financial crisis, the New York Times reports.
“The government actions, initially seen as necessary in Washington and on Wall Street to prevent a collapse of the economy on the order of the Great Depression, agitated the political world, helping give rise to the Tea Party movement on the right and the Occupy Wall Street movement on the left.”
“In all, through TARP and other efforts, taxpayers injected $426.35 billion into banks and auto companies. The sale of stock and interest payments brought in $441.7 billion.”
“Democrats would like some credit for the run of good economic news. Yet the better those reports are, the more divided the party has become over how — even whether — to take any,” the New York Times reports.
“In one camp are Democrats who argue that if they do not take some credit, they will continue to receive little. Others counter that boasting would backfire, infuriating millions of Americans who do not see the economy improving for them or their children.”
“Many, including President Obama, fall in the middle: still seeking to strike some balance, more than five years after the recovery officially began, between extolling progress and recognizing the pain that lingers.”
Wonk Wire: The U.S. economy added 321,000 jobs in November and the unemployment rate held at 5.8%.
First Read: “It’s possible — though hardly a certainty — that lower gas prices over a sustained period of time finally begin to change the public’s perception about the U.S. economy. After all, the economy has produced 200,000-plus jobs in each of the past nine months; GDP for the last quarter was revised up to a healthy 3.9%; and the unemployment rate has declined from 7.0% in Nov. 2013 to 5.8% now. But many Americans haven’t been FEELING that improvement, due in large part to wages not keeping up with the cost of living.”
“Politically, an improving economy helps the president and his party. (It also makes it harder to say the health-care law has stifled the economy.) And in macroeconomic terms, lower gas prices serve as a kind of economic stimulus — which Congress doesn’t have to pass or finance. Yet more importantly, they’re an easier way for Americans to ASSESS the state of the economy. The monthly jobs report might not mean a thing to them, but they can see when it costs just $35 to $40 to fill up their tank each week when it used to cost $50. ”
Wonk Wire: Plummeting costs make renewable power a viable competitor
“The economy expanded at its fastest pace in more than a decade during the spring and summer, showing the U.S. sits on a solid foundation despite increasing global uncertainty,” the Wall Street Journal reports.
“Gross domestic product, the broadest measure of goods and services produced across the economy, grew at a seasonally adjusted annual rate of 3.9% in the third quarter, the Commerce Department said Tuesday. The agency had previously estimated the third quarter’s growth rate at 3.5%.”
Wonk Wire: Is the era of rock bottom economics over?
Michael Lewis reviews Billionaires: Reflections on the Upper Crust by Darrell West and notes “there is a growing awareness that the yawning gap between rich and poor is no longer a matter of simple justice but also the enemy of economic success and human happiness. It’s not just bad for the poor. It’s also bad for the rich. It’s funny, when you think about it, how many rich people don’t know this.”
Wonk Wire: Are we inured to a new gilded age?
The U.S. economy added 214,000 jobs last month and the unemployment rate fell to 5.8% last month, the Wall Street Journal reports. That’s the lowest level since 2008.
Washington Post: “The latest encouraging numbers keep the nation on pace for its best labor market year since 1999 and stand in noted contrast to a wave of discontent that helped Republicans sweep a round of midterm elections this week. Though wage growth has been sluggish in recent years, Americans — helped by falling oil prices — are seeing their purchasing power rise. And they are now finding jobs with reliability unseen since the Great Recession.”
Wonk Wire: But when will wages grow?
“After years of gridlock in Washington, American business is gearing up for a major push on long-sought goals like an overhaul of the corporate tax system, building the Keystone XL oil pipeline, lighter environmental and financial regulation and winning congressional backing for trade deals with Asia and Europe. Business interests face a much more receptive audience now that Republicans are poised to control both the House and Senate next year,” the New York Times reports.
“But despite plenty of public talk of more aggressive action — like a rollback of the Affordable Care Act or the Dodd-Frank rules passed after the financial crisis — lobbyists, experts on Wall Street and political veterans say the actual legislative agenda will be much more limited.”
“Newly empowered congressional Republicans plan on moving quickly to demonstrate that they can effectively legislate, aware that they risk a backlash in two years if they fail to deliver,” the New York Times reports.
“Anticipating for months that they would take the Senate and pad their majority in the House, Republicans have been quietly discussing their agenda and approach after regularly accusing Democrats, led by Senator Harry Reid of Nevada, the majority leader, of thwarting their priorities. They say they will focus on balancing the budget, restoring an orderly process for spending bills, revising if not repealing the health care law and enacting a major overhaul of the tax code — ambitious goals, given years of stalemate and discord.”
“Before taking up the issue of immigration, Republicans are likely to see what unilateral action President Obama undertakes, and how the country reacts to it.”
Washington Post: “McConnell and Boehner are both eager to shed the party’s image as an unruly collection of obstructionists and far-right ideologues. The remedy, they have decided: Act quickly to send President Obama bills with bipartisan support to fast-track international trade agreements, repeal an unpopular tax on medical devices and approve the Keystone XL pipeline.”
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Goddard spent more than a decade as managing director and chief operating officer of a prominent investment firm in New York City. Previously, he was a policy adviser to a U.S. Senator and Governor.
Goddard is also co-author of You Won - Now What? (Scribner, 1998), a political management book hailed by prominent journalists and politicians from both parties. In addition, Goddard's essays on politics and public policy have appeared in dozens of newspapers across the country.
Goddard earned degrees from Vassar College and Harvard University. He lives in New York with his wife and three sons.
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