Republicans ignoring signs of some economic gains
WASHINGTON (AP) — You wouldn't know it from listening to the Republican National Convention, but the nation's economic picture seems to be slowly getting a little brighter.
Not a lot, and not very fast. Yet there are some glimmers.
But a steady drumbeat of gloom and doom is predictably being sounded at the GOP gathering in Tampa, Fla. — even by Republican governors who are quick to tout economic improvements in their own states.
Nationally, the recent gains are modest and won't do much to push the unemployment rate down much below its present 8.3 percent level before the Nov. 6 presidential election.
But economists cite some encouraging new data:
— The government reported Thursday that Americans spent at the fastest pace in five months in July, and personal income rose as well.
— Home prices rose in the first half of 2012 for the first time in nearly two years. Sales of both new and previously occupied homes also are up.
— Employers added 163,000 jobs in July, the most since February.
— U.S. exports, retail spending and factory production are all up.
Yet phrases such as "catastrophic debt," ''stifling the American dream," ''the tide of decline" and "an all-out assault on free enterprise" fill the air in the convention arena.
The rhetoric fits the GOP strategy of portraying President Barack Obama as out of touch and pursuing policies that have made the economy worse, not better, while Republican presidential nominee Mitt Romney is presented as the one with the business experience and savvy to turn things around.
Of course, Democrats get their turn for rebuttal next week at their own convention in Charlotte, N.C. But there are risks to sounding too optimistic on the economy.
Obama has been relatively cautious — welcoming recent positive reports but warning there's still a long road to a full recovery. To be more upbeat might play into GOP efforts to cast him as insensitive to the millions of Americans who remain jobless or are otherwise economically challenged.
Also, on Sept. 7, the morning after Obama accepts the Democratic nomination for a second term, the government releases unemployment figures for August. No one expects stellar figures.
Indeed, the economic recovery in the U.S. is the weakest of any since the Great Depression. Economic growth has never been feebler in a postwar recovery, consumer spending has never been so slack and only once before has job growth been slower, according to an Associated Press analysis this month.
A report released Tuesday showed the U.S. economy grew at a 1.7 percent annual rate from April to June — an upward revision from the initial 1.5 percent estimate but still signaling continued sluggishness.
Gasoline prices have been rising again toward $4 a gallon. Concerns remain over debt problems in Europe and a slowdown in China. And despite improving U.S. job and housing markets, consumer confidence is at its lowest level since November 2011.
Nigel Gault, chief U.S. economist at IHS Global Insight, said "housing is the area where you've got the most positives," and that's extremely important since housing weaknesses were a central cause of the downturn.
"We are at the start of a long prolonged recovery in the housing market. We're not bouncing along the bottom anymore," Gault said. "But there's still a long list of other reasons for businesses and consumers to be cautious."
"There's not much to gloat about," said Robert Shapiro, a former undersecretary of commerce in the Clinton administration who now advises Democrats and runs an economic consulting firm.
But things aren't as bad as Republicans portray, he said. "There is a recovery. We've been in a recovery in fact for over two years. It's an unusually slow recovery but it is a recovery."
Shapiro said Obama "can be justly proud of putting in place policies that stopped the slide into depression."
Some Republicans boast of improvements in their own states even as they recite a litany of national woes.
Ohio Gov. John Kasich touted a gain of 100,000 jobs in his state in the last year and an unemployment rate below the national average. Virginia Gov. Robert McDonnell told fellow Republicans that over the last two years, "with Republicans and Democrats working together, our unemployment rate is down over 20 percent."
McDonnell, who is also chairman of the Republican Governors Association, asserted that Republican governors generally do a better job handling economic challenges than their Democratic counterparts.
But since 29 of the 50 states have Republican governors, you'd think this would show up on the national charts. It doesn't.
"Mitt Romney will tell us the hard truths we need to hear to end the torrent of debt that is compromising our future and burying our economy," said New Jersey Gov. Chris Christie, the convention's keynote speaker. Unemployment in New Jersey is 9.8 percent — among the nation's highest.
"You can't believe anything you hear at a political convention. It's all a marketing opportunity," said economist Bruce Bartlett, an economic adviser to Presidents Ronald Reagan and George H.W. Bush, both Republican.
"Some sectors of the economy are showing signs of life, others are showing weakness. I can't blame Republicans for focusing on the ones showing weakness. As polls clearly show, the economy is clearly Obama's biggest weakness."
National polls show the economy remains the top issue by a long shot, including an AP-GfK poll taken a week before the GOP convention that showed 60 percent of those surveyed believe the country is headed in the "wrong direction," compared to only 35 percent who chose "right direction."
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