Appearing on Sunday's Meet the Press, DNC Chairwoman Debbie Wasserman Schultz served up another instant classic. I'll say this in her defense: Peddling partisan spin with a high tolerance for cognitive dissonance is a big part of any party chairman's job. Still, this performance is particularly tough to swallow -- so much so that DWS couldn't even complete her first sentence before an incredulous David Gregory was compelled to cut in:
"We were able to, under President Obama's leadership, turn this economy around."
Since the full screen graphic shown mere seconds before DWS uncorked her lame talking point clearly wasn't enough to dislodge her blue-tinted glasses, perhaps Harvard economist Martin Feldstein's grim assessment might shake her fantasy:
The drop in GDP growth to just 1.8% in the first quarter of 2011, from 3.1% in the final quarter of last year, understates the extent of the decline. Two-thirds of that 1.8% went into business inventories rather than sales to consumers or other final buyers. This means that final sales growth was at an annual rate of just 0.6% and the actual quarterly increase was just 0.15%—dangerously close to no rise at all. A sustained expansion cannot be built on inventory investment. It takes final sales to induce businesses to hire and to invest.
The picture is even gloomier if we look in more detail. Estimates of monthly GDP indicate that the only growth in the first quarter of 2011 was from February to March. After a temporary rise in March, the economy began sliding again in April, with declines in real wages, in durable-goods orders and manufacturing production, in existing home sales, and in real per-capita disposable incomes. It is not surprising that the index of leading indicators fell in April, only the second decline since it began to rise in the spring of 2009.
The data for May are beginning to arrive and are even worse than April's. They are marked by a collapse in payroll-employment gains; a higher unemployment rate; manufacturers' reports of slower orders and production; weak chain-store sales; and a sharp drop in consumer confidence.
Republicans should welcome Wasserman Schultz's framing. If Democrats would like to stake their collective 2012 fate on the premise that their effective, well-conceived policies have "turned the economy around," they should have at it. If that's the strategy, and barring a significant, unforseen economic turnaround, the Good Ship Democrat -- with Debbie Wasserman Schultz's steady hand on the tiller -- will surely run aground.