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6 Years a Failure on Growth

“The Obama recovery has failed America and is worse than previously reported,” says House economic leader.

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Washington, July 30, 2015 | comments

Washington, D.C. – U.S. Congressman Kevin Brady of Texas, the top House Republican on the Joint Economic Committee issued the following statement on the today’s release by Bureau of Economic Analysis (BEA) that real GDP grew at an annual rate of 2.3 percent during the 2nd-quarter of 2015.

“The Obama recovery’s failure on growth is even worse than previously reported.  Without stronger growth, good jobs will remain in short supply and incomes will continue to stagnate.”  

  • Economy Smaller than Previously Reported.  BEA had previously estimated 1st-quarter GDP was $16.287 trillion (2009$).  That number was revised down by $110.4 billion (2009$).  BEA’s advance estimate of $16.270 trillion (2009$) for 2nd-quarter 2015 real GDP is actually lower than previously reported for the 1st-quarter 2015.
  • Average Post-1960 Recoveries.  During other recoveries lasting longer than one year, real GDP grew at an annual rate of 4.0 percent in the six years following a recession.  During the strong Reagan recovery of the 1980s, real GDP grew at an annual rate of 4.8 percent over a comparable period.  Real GDP has grown at an annual rate of only 2.1  percent during the current recovery.
  • Growth Gap.  Compared with the average of other post-1960 recoveries, the growth gap in real GDP stands at $1.894 trillion (2009$), up from $1.801 trillion (2009$) last quarter.  Compared with the Reagan recovery, the growth gap stands at $2.767 trillion (2009$).
  • Eliminating the Growth Gap. In order to eliminate the growth gap in real GDP compared with the average of other post-1960 recoveries by the end of 2016, real GDP would need to growth at an annual rate of 10.1 percent over the next six quarters.  To catch up with the Reagan recovery, real GDP would need to grow at an annual rate of 14.2 percent over the next six quarters.
  • Real GDP growth per capita. In the six years since the recession ended, real GDP per capita has grown at an annualized rate of 1.3 percent.  The average per capita growth rate over a comparable period in other post-1960 recoveries was 2.9 percent.  In Reagan recovery real GDP growth per capita was 3.9 percent.  The per capita growth gap compared with other post-1960 recoveries stands at $4,815 (2009$)  and at $8,128 (2009$) when compared with the Reagan recovery.
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