Going into this morning, expectations for economic growth in the second quarter -- April, May, and June of this year -- were quite poor, making the actual GDP report a little more encouraging.
The U.S. economy grew at a 1.7% annual rate in the second quarter, buoyed by a solid gain in consumer spending and a sharp increase in business investment, the Commerce Department said Wednesday. Economists polled by MarketWatch had expected growth to total 1.0%.
To be sure, 1.7% GDP growth is not, by any fair measure, good news. It tells us the economy is growing, but the recovery is at best sluggish. But given the news we were expecting, 1.7% is a relatively pleasant surprise, especially since the previous quarter's growth was revised down to 1.1%.
Of course, this morning's report would have shown GDP growth over 2% had it not been for reductions in government spending, mandated by conservative policymakers who believe the recovery will be stronger if they weaken it by taking capital out of the economy. The caveat to this is that conservative austerity measures at the state and local levels appears to have come to an end, which helps mitigate the deliberate damage done by congressional Republicans.
Incidentally, this is also the report that revises previous GDP estimates, and it now appears the economy grew at a 2.8% annual rate in 2012, up from the previous 2.2% estimate.
As for the image above, the chart shows GDP numbers by quarter since the Great Recession began. The red columns show the economy under the Bush administration; the blue columns show the economy under the Obama administration.
Update: The original chart published above did fully not reflect Commerce Department revisions to previous years' growth. The image and the text has been revised and corrected.