Republicans Seize on Weak GDP Report, Build Case to Avert 'Looming Tax Hikes'
Economic estimates reflecting a weak 1.5 percent growth rate in the second quarter quickly became a political football Friday, as Republicans used the stat to chastise President Obama over his economic policies and bolster warnings about "looming tax hikes" next year.
The Commerce Department reported Friday that the economy grew at the 1.5 percent rate from April to June, as Americans cut back sharply on spending. The rate matched expectations -- but expectations were low.
In a hastily convened conference call, the Mitt Romney campaign pointed to the figure as the latest sign the economy under Obama simply cannot produce enough growth to put millions of jobless Americans back to work.
"It's a picture of a decelerating economy," said Romney economic adviser Dean Glenn Hubbard. "At that pattern, the economy simply will never return to full employment."
A campaign email with a snapshot of the gloomy GDP headlines also poked at Obama's recent "you didn't build that" gaffe. The email was titled: "The Obama Economy: Barack Obama Built This."
While Republicans used the report as a campaign cudgel, the White House tried to look on the bright side -- in that, the economy is technically growing.
"Today's report shows that the economy posted its twelfth straight quarter of positive growth," Alan Krueger, chairman of the Council of Economic Advisers, said in a statement. "While the economy continues to move in the right direction, additional growth is needed to replace the jobs lost in the deep recession that began at the end of 2007."
Republicans seized on the Commerce report with an intensity usually reserved for the monthly employment reports, which often feature prominently on the campaign trail.
They also used the report to build their case for extending all the Bush-era tax rates before they expire at the end of the year.
"Today's GDP report is a troubling sign for the future of our economy, and it underscores the need to stop all of the looming tax hikes that will weaken it further," House Speaker John Boehner said.
Senate Democrats passed their version of the tax plan earlier this week, which calls for the rates to be extended for households making less than $250,000 a year, and rates to rise for those making more. Democrats, including President Obama, say top earners need to pay more to help close the deficit and stress that their plan would still benefit the overwhelming majority of taxpayers.
But Republicans warn that the limited tax hike would hurt small businesses, not just the wealthy.
Read more: http://www.foxnews.com/politics/2012/07/27/economic-growth-slowed-to-15-percent-rate-in-2nd-quarter-slowest-in-year/#ixzz21pokVYtx