From an economic perspective, it would have been hard to expect more of 2014. After six years of frailty, the American economy is purring and may soon start to roar. The recession may finally be over.
The experts say the Great Recession actually ended five years ago, but tell that to the long-term unemployed or workers whose incomes aren’t keeping up with inflation. For millions of Americans, the recession has never ended. Maybe that will change.
The Dow Jones Industrial Average rose above 18,000 for the first time just before Christmas. The reason: Faster-than-expected growth in gross domestic product boosted confidence in the economy.
That growth produced the nation’s strongest economic vital signs in a decade. Businesses and consumers both opened their wallets in the third quarter, increasing economic output at an annual rate of 5 percent.
Even more encouraging, that growth was led by increased investment by businesses, a harbinger of further expansion. All in all, it was the strongest third quarter since 2003, when President George W. Bush was still in his first term.
And the good news doesn’t end there. The unemployment rate in Buffalo Niagara dropped to a seven-year low of 5.8 percent in October. The actual pace of job growth here is only modest, it is true. Helping to push down the unemployment rate from the other end of the yardstick is a shrinking labor force, driven largely by the retirements of older workers.
It would be more heartening if Western New York’s job growth matched the state and national rates, although that may yet happen as Buffalo’s resurgence takes hold. Still, a declining unemployment rate is a positive sign.
It’s been a long time coming. Near the end of the 2008 presidential campaign, the alarms about the economy were unmistakable. Then-President Bush responded appropriately, with a massive infusion of spending that pushed the annual budget deficit over the $1 trillion mark.
No one wants to see that kind of spending, of course, but in the face of an economic crisis that wiped out millions of jobs and eviscerated the housing market, it was Washington’s job to respond in force, and it did.
President Obama kept up that pace of spending, though the deficit began to shrink over the past couple of years. For the year that ended on Sept. 30, the deficit is estimated at $483 billion, less than half its recession peak. That is also a sign of economic growth.
Remember: Government spending saved the banking and automobile industries. Without either one of those expensive investments, the Great Recession could easily have cratered into a new Great Depression, with potentially calamitous results.
If it took a little longer to find our footing again, we appear to have done so in a way that avoided worse problems and kept faith, more or less, with those on whose lives the recession visited devastation.