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Trivia Tidbit Of The Day: Part 321 -- Three Cheers For The American Economy.
First quarter "real" GDP growth in the United States hit a two and a half year high:
That's not half bad, and while it's not likely that we'll sustain that sort of growth throughout the entire year, let's just compare 4.8% to the recent growth in "comparable nations" comment-sniper Michael Tam prefers (Australia, UK, Canada, France, and Germany), as well as a few others (Italy, Japan, Belgium, the Netherlands, Sweden, Denmark, and the European Union).
Using the latest data from the CIA World Factbook, here's the comparison:
Of course, just for reference, Angola grew at a 19.1% pace in 2005, China grew 9.3%, India grew 7.6%, Hong Kong grew 6.9%, and Singapore grew 5.7%. Zimbabwe, meanwhile, contracted to the tune of 7%.
But let's get back to that 4.8% "real" GDP growth in the United States. That "real" number, which is pegged to 2000 dollars for the sake of consistency and comparability, is fantastic, but in current dollars, the annual growth rate was actually 8.2%. In three months, the American economy added 254.8 BILLION dollars to its annual economic output. In twelve months, the American economy added 822.1 BILLION dollars to its annual economic output.
Let's think about what those $254.8 billion and $822.1 billion numbers mean.
254.8 billion dollars compares closely to the entire economy of Hong Kong-- or of Switzerland. It's also greater than the respective economies of Vietnam, Malaysia, Greece, Portugal, Norway, the Czech Republic, Chile, Denmark, Venezuela, Israel, and Ireland, just to name a handful.
In the first quarter of 2006 alone, the American economy added what amounts to the entirety of the island economies of Singapore, New Zealand, Bahrain, and Iceland, combined.
That's not insignificant at all.
Of course, it's even more fun to play with the 822.1 billion dollar figure. You can add the entire economies of Saudi Arabia, Belgium, Lebanon, Honduras, Croatia, and Kuwait, with room to spare.
Then, again, if you want to use the "real" dollar gains, rather than current dollar ones, in the first quarter, it's only an addition of 133.1 billion dollars. In that case, the United States only added a Nigeria's worth of economy in those three months.
Still not insignificant, at all.
When the largest economy in the world grows at a 4.8% annual "real" rate, and 8.2% annual current-dollar rate, it ought to be the top news story, everywhere, all weekend long. We've added several countries-worth of economy to our own in just the past three months. That's HUGE news. The consequences of such economic growth are rife-- and profound. For one, our national debt burden seems a little more manageable. Our ability to project power and influence in the world (as well as take care of things at home) increases substantially.
Incidentally, Reuters is underselling America's economy by roughly 15%:
Economists generally consider the long-term sustainable growth rate for America's $11-trillion economy to be around 3.5 percent.
Hello, Reuters, and welcome to 2003; the rest of us have since moved beyond an $11 trillion economy to more than $13 trillion. Two trillion dollars might not seem like a lot to the moneybags working over at Reuters, but, dad gum it, two trillion still means something on this blog.
Of course, the Reuters explanation would be that they are using the "2000-chained dollars" (11,381,400,000,000) figure instead of "current dollars" ($13,020,900,000,000).
Either way, come on, Reuters, stop living 3 years (if we're talking about current dollars) or 6 years ago (if "real" dollars are the way to go), and stop, in so many other subtle and not-so-subtle ways, underplaying the amazing American economy already.
"Real" (2000-pegged) dollars are great for comparing growth rates across time. It keeps things nice and even. But describing the actual size of the American economy in 2000 terms makes little sense.
So, let's hear it: three cheers for the American economy.
Source: Bureau of Economic Analysis, U.S. Department of Commerce: "Gross Domestic Product, First Quarter 2006 (Advance)" (.pdf).
Previous Trivia Tidbit: Energy.
Posted by Will Franklin · 28 April 2006 02:11 PM
what about Iraq's GDP? Isn't it off the charts?
Posted by: christian at April 29, 2006 06:48 AM
To make things better, Italy just elected a communist parlimentary speaker. 0.2% GDP? Ya that will soar no with communists in office!
Posted by: christian at April 29, 2006 08:39 AM
So if we grow at 4.8% and China which is less than half of our economys size grows at 9% (which is completely unsustainable) and considering that China has 1.5B people to our 300M, how many hundreds of years will it be before the per capita GDP of China catches up with us? That is just to catch us.
It is growth in the economy that allows innovation and R&D spending, and consequently R&D spending that creates future growth. By all metrics, the economies of old Europe are about as stagnant as can be. We are growing despite the pressures of "outsourcing" and "China" and "offshoring" and all of the other Socialist scare rhetoric coming from the Democrats. And their little babies like France and Germany are actually shrinking in both their role in the world and in their relative share of the world economy.
Posted by: Justin B at April 29, 2006 07:33 PM