Ugly: Q2 GDP Growth Falls to 1.3 Percent, Q1 Growth Revised to Microscopic 0.4 Percent

Posted: Jul 29, 2011 10:31 AM

There's no sugar-coating these brutal economic numbers, and the Associated Press doesn't even try:

The economy expanded at [a] meager rate of 1.3 percent annual rate in the spring after scarcely growing at all in the first three months of the year, the Commerce Department said Friday.  The combined growth for the first six months of the year was the weakest since the recession ended. The government revised the January-March figures to show just 0.4 percent growth -- down sharply from its previous estimate of 1.9 percent.

High gas prices and scant income gains have forced consumers to pull back sharply on spending in the spring.  Stock futures fell after the report was released.

"These numbers are extremely bad," said Nigel Gault, an economist at IHS Global Insight. "The momentum in the economy is clearly very weak."  The sharp slowdown means the economy will likely grow this year at a weaker pace than last year. Economists don't expect growth to pick up enough in the second half of the year to lower the unemployment rate, which rose to 9.2 percent last month.

Democrats blame the sputtering economy on President Bush, who hasn't occupied the Oval Office for the better part of three years.  To put that in perspective, Senate Democrats have even offered a budget -- 821 days ago -- more recently than Bush's final day as president.   The Left believes government can spur economic growth with more stimulus spending and tax increases.  Conservatives vehemently disagree.  This fundamental ideological clash will feature prominently in Battle: 2012. 

UPDATE - In light of this dreadful economic news, might President Obama's standing among independents sink even lower?

The Pew poll suggests independent voters are driving this drop. In May, 42 percent of independents supported Obama's re-election, while 35 percent preferred his challenger. Now, that figure is upside down: 31 percent of independents are inclined to vote for him in 2012 while 39 percent want to replace him with a Republican.