The U.S. Bureau of Economic Analysis reported this morning that the economy expanded at an annualized rate of 1.7 percent in the second quarter, much faster than the consensus forecast of 1.0 percent.
Growth looks even less impressive when you step past the noisy quarterly numbers and focus instead on the 12-month changes. As you can see in the chart below, the economy only grew by 1.4 percent since the middle of last year — the slowest pace since the recovery began more than three years ago.
A new analysis from the Federal Reserve Bank of Dallas provides a broader perspective on the weakness of this recovery and the damage caused by the crisis. They estimate that the shortfall in GDP from 2008 through 2023 amounts to about $10 trillion in today’s dollars.
The shortfall in spending on non-durable