he U.S. economy grew at an annualized rate of 2.5 percent in the third quarter, the Commerce Department said Thursday, notching a healthy and "surprising" improvement over the second quarter's 1.3 percent rate and the positively anemic 0.4 percent GDP growth in the first quarter. Consumer and business spending led the modest charge. Economists and the White House are undoubtedly relieved that the economy is heading in the right direction, says Daniel Indiviglio at The Atlantic. But the big question remains: "Is the recovery back on track?"
Yes. Surprisingly, things are looking up: First, let's marvel that "the U.S. economy nearly doubled its growth" in the terrible quarter we just endured, says Catherine Hollander at National Journal. That 2.5 percent figure won't take us back to the glory days, but it's "not too shabby" for a three-month period that included a historic U.S. credit downgrade, threat of a federal default, a dangerous European sovereign debt crisis, and no action in Washington to fix anything. We're back on our "gradual climb out of recession."
"Good news: Rise in GDP growth shows long-term trends"
No. We're merely treading water: The GDP data is "better than expected," and staves off fears of a double-dip recession, says economist Kathy Bostjancic, as quoted in The Wall Street Journal. But even this modest level of growth "doesn't look sustainable." When you factor in the terrible numbers for consumer confidence, unemployment, and the housing market, "sustained economic growth above 2 percent is simply unlikely." And that's a big problem.
"Economists react: 'Where are the recession calls now?'"
Let's see what happens next: When you consider how much work needs to be done to rescue the economy from its dire straits, 2.5 percent growth is "extremely disappointing," says Ryan Avent at The Economist. But "given what seemed possible a month ago, it's a relief." All in all, "the story of the recovery remains mostly unchanged": Abnormally slow growth and scant progress on unemployment. Our best hope is that, "having survived a difficult summer," consumers and business will regain some confidence, and "policymakers will do more to support growth and less to court disaster."
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