Six words that launched a weekend of politicking: "The Private Sector is Doing Fine."
His opponents called him tone deaf and out of touch. The president and his team furiously backtracked and hit back. Forget the politics, let's look at three gauges of health.
Jobs, profits, and business loans.
The White House says the private sector has created 4.3 million jobs over the past 27 months. Correct. But economists say a healthy, growing economy should have created more. University of Maryland economist Peter Morici says we should have created 4 to 5 times as many jobs. And over the past two years, the largest U.S. companies added jobs overseas at three times the pace they added jobs here in the U.S.
How about profit? Corporate profits have risen 58 percent since mid-2009. So yes, big companies are making money. But they're putting it right into the bank, not back into the economy. The Federal Reserve says companies had $1.74 trillion dollars in the bank at the end of March. Twice what is normal.
And finally -- businesses need loans to grow. Since the end of the recession, loan growth has been historically weak, and small businesses have bitterly complained that they can’t get the loans they need to expand.
The private sector is not a homogeneous monolith. It’s everything from General Electric all the way down to your local electrician. Depending on where the business is, how much exposure it has to credit, and how robust its demand is, there remains unprecedented uncertainty since the end of the recession.