Greetings to our Constituents, fellow Floridians, and all Americans. It is time for our weekly update.
My wife, Angela, and I bid farewell this week to two constituents who were very dear friends. One was a highly accomplished businessman and stalwart conservative, Larry Day. May God bless you Larry, and may God bless your wife Sharon. We will miss you.
Our other dearly departed friend was Mrs. Greta Sussman, an American patriot. Greta was so warm and kind to Angela and our daughters, especially when she invited our family to her home for Friday Shabbat dinner. It was very special. To her husband and former Mayor of Hillsboro Beach, Chuck, I want to say that Angela and I will always be here for you and your lovely family.
Americans like Larry Day and Greta Sussman are why I serve this great nation. They are indicative of that unique American exceptionalism and indomitable spirit that never surrenders. As we go forward as a nation, it is that indomitable spirit that will guide us back to the greatness that we know is achievable. An integral subset of that indomitable spirit is our American entrepreneurial drive, which has fueled our free market and enterprise system and given birth to unprecedented economic growth, innovation, ingenuity, and investment.
Still, today's report of a 2.0 percent GDP growth for the third quarter, is not reflective of what rugged individual industrialists can achieve. Our previous second quarter GDP growth was initially reported as 1.8 percent only to be downgraded to 1.3 percent. My concern is that this number will receive the same revision in mid-November.
The almost $1 trillion stimulus promised a GDP projection of 4.5 percent right now, as well as unemployment of only 5.8 percent. One disturbing aspect of today's report is that the key driver of private sector job creation, real nonresidential fixed investment, declined for the first time since the first quarter of 2011. Real nonresidential fixed investment remains 7.2 percent lower than it was when the recession began in the fourth quarter of 2007. Also, the tiny 0.72 percentage point of today's reported 2.0 percent annualized growth rate was the result of higher Federal Government consumption and investment. We all know the Federal Government is currently spending about 25 percent of our GDP with estimates from the Obama Administration's Fiscal Year 2013 budget projecting it to grow to nearly 32 percent.
Today's report cements America's current recovery in last place among post-World War II recoveries lasting more than a year. Since the recession ended in June 2009, real GDP has increased a total of 7.2 percent. The average total increase in real GDP over the comparable 13 quarters in the other recoveries was 16.8 percent. In the strong President Ronald Reagan recovery of the 1980's, real GDP increased a total of 19.6 percent. In comparison, President Reagan had the economy humming at 7.1 percent GDP growth at the same period of time in his presidential term. If the economy had grown at the average pace of the other post-World War II recoveries, real GDP would be $1.2 trillion higher (based on 2005 dollars). A Reagan-style recovery would have produced an economy with $1.6 trillion more than the current recovery (again, based on 2005 dollars).
A bigger economy would mean more job creation and higher federal revenues. If the economy had grown at the average pace of the other recoveries, and revenues had returned to a Fiscal Year 2007 level relative to GDP, the budget deficit would have been reduced by more than half. In other words, we would currently have a budget deficit of only $230 billion, rather than $1.1 trillion. Sadly enough, the debt is taking the opposite growth path, which is why we have an upside-down debt to GDP ratio.
Lastly, we continue to learn more about the incident in Benghazi, yet we hear no response or explanation from President Barack Obama. I remember the University of North Carolina basketball team, under Coach Dean Smith, used a tactic called, "four corners." It was a stall tactic implemented, particularly in the second half, since there was no shot clock to run down the clock.
It is evident by his appearances on those really tough media outlets like Inside Edition, Daily Show, Late Night, Tonight Show, and MTV that President Obama, a basketball enthusiast, learned about using the four corners. But there's one difference. The President's team has no lead on the scoreboard, and the American people have the ball. The only question is, will they slam dunk?
Steadfast and Loyal,
Allen B. West