WASHINGTON -- There is no question the economy is now in the early stages of recovery, though it has a long way to go before it gets back on its feet again and regains full health.
While there are a number of tentative but hopeful signs of a comeback, the big question (outside of who is responsible for the turnaround) is how strong will the recovery be. Some say it will be subpar when compared to previous recoveries. I don't underestimate American capitalism's ability to adapt and overcome difficult economic circumstances -- it has done so many times before -- but the administration's spend-and-tax policies are not the kind of prescriptions that have fueled meteoric growth in the past. It's hard to talk about the prospects of recovery with a 9.7 percent jobless rate, the highest in 26 years, which analysts predict will soon hit 10 percent. There were 14.9 million unemployed Americans in August and many more who have given up looking for work. More than 5 million have been unemployed for at least seven months. The unemployment rate, unfortunately, is one of the last key economic figures to show any improvement in a recovery, and that is likely to be the case this time as well.
The administration's efforts to make much of the fact that the rate of job losses has slowed are of little consolation if you are among those who have lost a job.
Nevertheless, it is important to note the early recovery signs if only to track where the economy is beginning to improve and where it remains in a deep hole.
Last week, the Federal Reserve's "beige book" said the economy remains fragile, with sporadic signs of improvements in different regions, but overall has begun growing again. Among the good signs:
-- The U.S. manufacturing sector, which is so far down it's hard to see up, grew last month for the first time in 19 months. The Institute for Supply Management reported that its manufacturing index rose by the highest number since June 2007 and new orders increased to the highest level since the end of 2004.