LAT Story on UCLA Study Relayed By AP: 'It's Not a Recovery. It's Not Even Normal Growth. It's Bad'

The most interesting thing (to me, at least) about Wednesday's report in the Los Angeles Times by Ricardo Lopez on how the author of an economic report out of UCLA has said that the U.S. economy's performance since the recession officially ended in June 2009 stinks -- "It's not a recovery. It's not even normal growth. It's bad" -- is how the Associated Press relayed it to its readers and subscribers. I don't recall ever seeing a 15-plus paragraph report go unbylined, but this one did.

Maybe whoever wrote the AP item didn't want to incur the wrath of his or her colleague Tom Raum, who early last week wrote that the economy is "clearly, if slowly" recovering. It's also somewhat likely that Christopher Rugaber, who wrote "Gone are the fears that the economy could fall into another recession" in early April, might be a bit miffed. Choice nuggets from Lopez's LAT lament follow the jump:


UCLA Anderson Forecast paints dismal picture of economic recovery
"It's not a recovery. It's not even normal growth. It's bad," UCLA economist Edward Leamer says.

The country's tepid growth in its gross domestic product isn't creating enough good jobs to build a strong middle class, according to a UCLA report released Wednesday.

"Growth in GDP has been positive, but not exceptional," UCLA economists wrote in their quarterly Anderson Forecast. "Jobs are growing, but not rapidly enough to create good jobs for all."

The report, which analyzed long-term trends of past recoveries, found that the long-anticipated "Great Recovery" has not yet materialized.

Real GDP growth — the value of goods and services produced after adjusting for inflation — is 15.4% below the 3% growth trend of past recoveries, wrote Edward Leamer, director of the UCLA Anderson Forecast. More robust growth will be necessary to bring this recovery in line with previous ones.

"It's not a recovery," he wrote. "It's not even normal growth. It's bad."

That has long-term implications in the face of technological advancements that continue displacing workers, Leamer said. And the country's education system isn't adequately developing the workforce of the future, he said.

I think setting the bar for acceptable post-recession growth at 3 percent per year is unacceptably low. Most if not all post-World War II recoveries have far outperformed that mediocre benchmark.

Leamer does take some liberties with the data when he claims that, in Lopez's words, "The Golden State outperformed the U.S. in the rate of payroll jobs growth in the 12-month period that ended in April 2013. Only Utah has added jobs faster than California."

That's true if you refer to the Department of Labor's Household Survey which is based on contacts with household members. Although the Household Survey does include a more comprehensive total employment number than the Establishment Survey based on contacts with employers, its primary use is to present unemployment rates. That said, the Household Survey number would be an acceptable reference point if it weren't for two inconvenient facts: 1) It allows illegal immigrants into the survey by not asking respondents what their legal status is, and 2) California has lots of illegal immigrants -- at least 2.5 million. According to the Establishment Survey, at least four states -- Texas, North Dakota, Colorado, and Utah (there may be others; I found enough examples to make my point) -- have seen their workforces grow by a greater percentage than California's during the past 12 reported months.

Sadly, neither Lopez at the Times nor the unidentified writer at AP really dug into why "it's bad"; in fact, they seemed to consciously avoid it. Out-of-control Keynesianism, deficits, debt buildups, and regulations deserved to be mentioned, and weren't.

Cross-posted at BizzyBlog.com.

Tom Blumer
Tom Blumer
Tom Blumer is a contributing editor for NewsBusters.