President Barack Obama signs a Memorandum of Disapproval regarding a joint resolution providing for congressional disapproval of a rule submitted by the National Labor Relations Board relating to representation case procedures. The joint resolution passed by Congress is a rarely used oversight tool that allows legislators to block regulatory actions
President Obama signs Memorandum of Disapproval, vetoing measure blocking NLRB rules on union elections. http://t.co/BuKbShDWEk
NYT: Business Spending, Exports Spur Big Bounce In U.S. Economy
The U.S. economy grew at its fastest pace in 2-1/2 years in the second quarter with all sectors contributing to the jump in output in a bullish signal for the remainder of the year. The Commerce Department on Friday raised its estimate of growth in gross domestic product to a 4.6 percent annual rate from the 4.2 percent pace reported last month. The United States is bucking a spate of weaker overseas growth with the euro zone and Japan slumping, and growth in China slowing as well. the expansion in consumer spending, combined with strong business investment,
was nevertheless enough to push domestic demand ahead at its fastest pace since 2010. That suggests the economy’s recovery is becoming more durable after output slumped at a 2.1 percent rate in the first quarter because of an unusually cold winter. So far, data covering manufacturing, trade and housing suggest that much of the second quarter’s momentum spilled over into the third quarter. Growth estimates for the July-September quarter range as high as a 3.5 percent pace. When measured from the income side, the economy grew at a 5.2 percent pace during the second quarter…export growth was raised to an 11.1 percent pace, the fastest since the fourth quarter of 2010, from a 10.1 percent rate.
Jason Furman: Third Estimate of GDP For The Second Quarter Of 2014
1. Real gross domestic product (GDP) increased 4.6 percent at an annual rate in the second quarter of 2014, the fastest pace since the fourth quarter of 2011, according to the third estimate from the Bureau of Economic Analysis. The strong second-quarter growth represents a rebound from a first-quarter decline in GDP that largely reflected transitory factors like unusually severe winter weather and a sharp slowdown in inventory investment. Growth in consumer spending and business investment picked up in the second quarter, and residential investment increased following two straight quarters of decline. Additionally, State and local government spending grew at the fastest quarterly rate in five years. However, net exports subtracted from overall GDP growth, as imports grew slightly faster than exports.
Real gross domestic income (GDI), an alternative measure of the overall size of the economy, was up 5.2 percent at an annual rate in the second quarter. 3. Over the past four quarters, real GDP has risen 2.6 percent, faster than the 2.0 percent annualized pace observed over the preceding eight-quarter period. Looking at four- and eight-quarter changes to smooth some of the quarter-to-quarter volatility, it is clear that many components of GDP are showing improvement. The growth rates of consumer spending, business investment and exports have all picked up, and the pace of declines in the Federal sector have moderated a bit. In addition, the State and local government sector has turned positive, after several years of steady cutbacks. One area that has slowed over the last four quarters is residential investment, although it did rebound in the second quarter.
Yahoo: Economy In U.S. Expands 4.2%, More Than Previously Forecast
The biggest gain in U.S. business investment in over two years helped the world’s largest economy expand more than previously forecast in the second quarter, raising expectations for the rest of 2014. Gross domestic product, the value of all goods and services produced, rose at a 4.2 percent annualized rate, up from an initial estimate of 4 percent and following a first-quarter contraction, Commerce Department reported today in Washington. Other reports showed the outlook for home sales improved in July, fewer people filed claims (INJCJC) for jobless benefits last week and consumer confidence climbed. Recent data showing American factories are receiving more orders and employment is picking up indicate companies such as General Electric Co. (GE) will probably see demand sustained into the second half of the year. “The recovery is becoming more well-entrenched,” said Scott Brown, chief economist at Raymond James & Associates Inc. in St. Petersburg, Florida, who correctly projected the gain in GDP.
“There is more optimism among businesses about increased demand. The drop in firings is probably helping Americans feel more secure in their jobs. The Bloomberg Consumer Comfort Index rose in the week ended Aug. 24 to the highest level in more than a month as views of household finances advanced to an almost four-month high, another report showed. Household consumption, which accounts for about 70 percent of the economy, grew at a 2.5 percent annualized rate, the same as previously estimated. Automobile sales near an eight-year high bode well for consumer spending and factory production. Consumers’ purchasing power improved, with disposable income adjusted for inflation rising at a 4.2 percent from April through June after a 3.4 percent gain in the first quarter. Gross domestic income, which reflects all the money earned by consumers, businesses and government agencies climbed at a 4.7 percent annualized rate in the second quarter, the most since early 2012. More hiring and stock-market gains that are boosting confidence also are healing household finances, which will help consumer spending. Payrolls in July marked the sixth month of gains exceeding 200,000, the longest such stretch since 1997, according to the Labor Department.
Jason Furman: Second Estimate Of GDP For The Second Quarter Of 2014
1. Real gross domestic product (GDP) increased 4.2 percent at an annual rate in the second quarter of 2014, according to the second estimate from the Bureau of Economic Analysis. The strong second-quarter growth represents a rebound from a first-quarter decline in GDP that largely reflected transitory factors like unusually severe winter weather and a sharp slowdown in inventory investment. Growth in consumer spending and business investment picked up in the second quarter, and residential investment increased following two straight quarters of decline. Additionally, state and local government spending grew at the fastest quarterly rate in five years.
3. Over the last four quarters, real GDP has risen 2.5 percent, faster than the 2.0 percent annualized pace observed over the preceding eight-quarter period. Looking at four- and eight-quarter changes to smooth some of the quarter-to-quarter volatility, it is clear that many components of GDP are showing improvement. The growth rates of consumer spending, business investment and exports have all picked up, and the pace of declines in the Federal sector have moderated a bit. In addition, the State and local government sector has turned positive, after several years of steady cutbacks. One area that has slowed over the last four quarters is residential investment, which is discussed in greater detail in the next point.
Like a bad summer-pop earworm, some economic ideas get stuck in our heads for no good reason and refuse to go away. Take, for example, the remarkably durable myth that Obama has presided over a “part-time economy,” where full-time work has been devastated by his relentlessly anti-capitalist policies. The Atlantic has done our best to bust this myth, but there’s no killing some summer earworms, and so, like a particularly terrible Top 40 DJ, here comes Mort Zuckerman, spinning the old track on the Wall Street Journal op-ed page. It’s impossible to briefly sum up Zuckerman’s argument—”The Full-Time Scandal of Part-Time America”—which is a collage of bad stats and randomly drawn lines of causality.
The gist is that the U.S. economy only makes part-time jobs now, and Obamacare is hastening the demise of full-time work. The easiest way to fact-check the claim that part-time work is rising is to measure Americans working part-time who want to work full time—i.e. “for economic reasons.” 1) Most people working part-time want to work part-time because they’re in school, or they’re raising kids, or they consider themselves mostly retired. Don’t pay attention to anybody who’s using the number of stay-at-home dads and moms to argue that Obamacare is destroying full-time work. The president’s critics love this talking point. But since 2010, full-time jobs are up 7.6 million, and part-time jobs have declined by more than 900,000.
A family-run concrete business in Michigan, the U.S.’s second-biggest carmaker, the largest railroad and a solar power provider in California are all hiring as industrial companies lead a broad labor-market rebound that’s on pace to add the most jobs in 15 years. Employment may be headed for a “breakout year” as companies feel more secure adding to payrolls following several years of demand rising only to stumble on threats from U.S. budget standoffs, a debt-ceiling induced default and a European credit crisis, said Marisa Di Natale, a director at Moody’s Analytics. Industries from construction to autos to oil and gas are increasing jobs as growth accelerates after a harsh winter stunted business. Help-wanted signs at concrete company Kent Cos. is one indication of a hiring rebound that could create more than 2.56 million jobs, the most since 1999, if the pace is sustained. Warren Buffett’s BNSF Railway plans to grow by 2,100 positions in 2014. SolarCity is adding 400 people a month at the rooftop power-system installer backed by Elon Musk. At Ford, hiring is so strong that the automaker predicts it may beat a 2011 plan to bring on 12,000 new workers by 2015.
Jeff VanderLaan, chief executive officer at Kent Cos., plans to add 100 people this year, a 27 percent jump in his workforce to a record 475. The Grand Rapids, Michigan-based provider of services such as pouring floors and installing piers is seeing business boom in Texas, North Carolina and Ohio. May employment growth was also driven by the oil and gas extraction industry at 7.6 percent and building construction at 5.2 percent. Outpatient care jumped 5.8 percent and motor vehicles and auto parts climbed 4.3 percent. The continued recovery in homebuilding is crucial for the job market, Di Natale said. Beyond the direct construction jobs, new homebuilding spurs purchases of carpets, flooring, lighting, appliances and furniture. Moody’s is forecasting job growth of 1.8 percent this year, which would be the highest rate since 2005, and for it to peak at 2.4 percent in 2016. Housing starts on an annual basis surpassed 1 million in May and April. They had declined to as low as 478,000 in April 2009, creating pent-up need for homes and apartments. The boom in technology has driven the unemployment rate below 1 percent in the industry. New financial regulations and requirements for the Affordable Care Act are also boosting demand for professionals, he said.
After laying off workers through most of the recovery, city and county governments are adding jobs at the fastest pace in five years, providing support for the economy’s overall payroll gains. Stronger economic growth is driving higher municipal revenue, allowing local governments to add police officers and firefighters, reopen shuttered parks and make long-deferred street repairs. “We’re beginning to see cities and towns coming out of the Great Recession,” says Neil Bomberg, a program director for the National League of Cities. Mark Zandi, chief economist of Moody’s Analytics, notes that total U.S. payroll gains have topped 200,000 each of the past four months.
Our businesses have added:
9.4 million jobs over 51 months ✔
More than 1 million this year ✔
216,000 in May ✔
Local governments are on more solid financial footing in part because of a gradual rise in home values that have boosted property tax collections, says Michael Pagano, dean of the college of urban planning and public affairs at the University of Illinois-Chicago. Earlier this year, Columbus, Ohio, passed an $807 million operating budget, its largest ever, that restores six recreation centers that had been open part-time to full-time status. The city’s finances have been stable since it raised its income tax to 2.5% from 2% in 2009, says Dan Williamson, spokesman for Mayor Michael Coleman.
Sara Kliff: Survey: 57 Percent Of Obamacare Enrollees Were Previously Uninsured
A slim majority of Obamacare’s private insurance enrollees were uninsured when they signed up for coverage, a new survey from the Kaiser Family Foundation finds. Obamacare opponents have regularly argued that most enrollees already had coverage, meaning that health reform wasn’t driving down the uninsured rate. The new Kaiser survey, which uses a randomly-selected panel of 742 people who bought private coverage through the new exchanges,
finds that 57 percent of those who signed up for private coverage didn’t have an insurance plan when they enrolled. The Kaiser survey suggests that most people who bought on the marketplace weren’t trying to replace a plan they already had. They were people who lacked insurance coverage, and were using the new health care law to gain access to a plan they didn’t have before.
Mother Jones: About Half of Obamacare Exchange Enrollees Were Previously Uninsured
A new Kaiser survey shows that 57 percent of those who bought health insurance on Obamacare exchanges were previously uninsured. That’s about 4.5 million people who gained private insurance via the exchanges, and the vast majority of them say they would have remained uninsured if not for Obamacare. If this number is correct, it suggests that the number of newly insured by the end of the year will be a little higher than I’ve projected before—perhaps around 11-13 million.
Tara Culp-Ressler: Young Adults Got Healthier And More Financially Stable After Obamacare Was Implemented
Obamacare’s efforts to expand access to health insurance for young Americans may be helping them maintain better health and financial security, according to a large new study analyzing the impact of health care reform over the past four years. The study, published in the Journal of the American Medical Association (JAMA) on Wednesday, found that young Americans are now reporting better physical and mental health and their out-of-pocket medical expenses have declined. “The health insurance that people are gaining seems to be doing what it is supposed to do,” Dr. Kao-Ping Chua, a pediatrician at Boston’s Children’s Hospital and the lead author of the study, told the Los Angeles Times. In 2010, Obamacare began allowing young adults to remain on their parents’ health insurance plans until the age of 26. Since then, several surveys have found that the rate of uninsurance among that population has sharply declined. The JAMA study is one of the first to attempt to more broadly measure the impact of this aspect of the Affordable Care Act in the four years since it took effect.
In order to assess Obamacare’s impact, the researchers analyzed annual survey data collected between 2002 and 2011, before and after the coverage provision’s implementation. They tracked information from more than 60,000 people who fell into one of two different groups: young people between the ages of 19 to 25, who became newly eligible to remain dependents on their parents’ plans, and a control group of older adults between the ages of 26 to 34 who could not take advantage of that provision. Some significant differences emerged between the two populations. Among the younger group, there was a 6.2 percentage point increase in people reporting excellent physical health, as well as a 4 percentage point increase in people reporting excellent mental health. That group was also more likely to be insured, and experienced an 18 percent decline in their annual out-of-pocket medical costs.