Despite a $1 trillion expansion of America’s money supply and the “most stimulative fiscal policy” in history, the U.S. economy has actually continued to decline over the last three years, according to U.S. News & World Report chief Mortimer Zuckerman.
“The Great Recession is an apt name for America's current stagnation, but the present phase might also be called the Grand Illusion — because the happy talk and statistics that go with it, especially regarding jobs, give a rosier picture than the facts justify,” penned Zuckerman, in an article published Monday in The Wall Street Journal.
After 2.4 percent annual growth rates in gross domestic product both in 2010 and 2011, the economy slowed to 1.5 percent growth in 2012, said Zuckernman, who noted that the cumulative growth for the past 12 quarters was just 6.3 percent, which amounts to the slowest of all 11 recessions since World War II.
“The country isn't really advancing, By comparison with earlier recessions, it is going backward,” said Zuckerman.
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“And last year's anemic growth looks likely to continue,” he explained. “Sequestration will take $600 billion of government expenditures out of the economy over the next 10 years, including $85 billion this year alone. The 2 percent increase in payroll taxes will hit about 160 million workers and drain $110 billion from their disposable incomes.”
Moreover, President Obama’s signature healthcare legislation — Obamacare — “will be a drag of more than $30 billion,” he estimated. “The recent 50-cent surge in gasoline prices represents another $65 billion drag on consumer cash flow.”
Zuckerman also insists that the 236,000 net new jobs added to the economy in February is misleading because it counted 340,000 part-time, low-wage jobs.
“Many of the so-called net new jobs are second or third jobs going to people who are already working, rather than going to those who are unemployed,” said Zuckerman.
He said that number of Americans unemployed for six months or longer also went up by 89,000 in February to a total of 4.8 million. “The average duration of unemployment rose to 36.9 weeks, up from 35.3 weeks in January,” according to Zuckerman.
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