We’ve probably all heard those “Good news, bad news” jokes in which a person is asked which he wants first, the good news or the bad news. Usually the first reply to that request is for the good news, but seldom is that enough and the person queried also wants the bad news, which sometimes proves devastating. That’s funny when it’s a joke, but not always in real life.
Ever notice how some people can take something good and seemingly turn it into a bad situation?
Remember when you were a youth. Your parents told you they were going to boost your weekly allowance because you had been so good. You begin to think how much you will get, maybe 50% extra or even more. Then, when you receive your money and the increase is only 15%, what did you think about? Did you focus on what you got or what you didn’t get?
Another example. Take the US economy. If growth is reported, but it’s not as much as expected, is that good news or is that bad news?
I realize this is a simplistic analogy, particularly when applied to something as complex as economics, but I often see this approach used when members of the media report news or when various individuals write opinion pieces for public consumption. Often it’s not the direction, i.e., whether there is gain or loss, but whether the increase equaled the expectations. Now, don’t get me wrong. Expectations are good and serve as valid benchmarks for progress, but sometimes I wonder if the general public is given a fair shake when information about our nation’s or state’s economic growth is tempered with the fact that the advancement wasn’t as much as anticipated.
Through the years, all of us have probably witnessed the antics of naysayers and doomsday predictors, sometimes with amazement and at other times in amusement.
I’ve always been “the glass-is-half-full” kind of person. Over the past 25 years or so that I’ve been a professional economist, I’ve usually maintained an optimistic view of the American economy.
That’s not to say I have ignored problematic conditions or looked at situations with rose-colored glasses. It just means that I have confidence in the American people and their ability to withstand all kinds of difficulties and in doing so to not allow adversities to sidetrack their attention from the path of positive progression.
Our nation is some 230 years old, and Texas is about 60 years younger. No one can doubt that over such a lengthy period, we have seen many ups and downs. Equally true, no one can doubt that our nation and our state have survived conditions bordering on perilous.
From January through March of this year, the US economy expanded at a 5.6% pace. The strong rate of growth was indicative of the ability of Americans to survive, even thrive after difficult periods. The 2006 first quarter report shows the nation was able to rebound from the 1.7% growth rate for the last quarter of 2005—the result of a slowdown induced by the unprecedented destruction of the hurricanes on the Gulf Coast.
The preliminary second quarter report on US economic growth is set for release July 28. Most economists are predicting a cooling in the economy for the months from April through June, brought on in large part by high energy prices and a moderate housing market. I agree.
However, as I see it, in spite of the enormous difficulties and uncertainties our nation has faced over the past several months and is still facing, the American economy remains strong. Even though the rate of growth for the second quarter will likely be less than that reported for the first quarter, which incidentally was the hottest tempo in two and a half years, the operative word is “growth.”
The US economy is the biggest in the world, and in spite of the see-saw economic growth pattern in which we find ourselves, I have no doubt that over the long term, it will remain healthy and continue to grow.