Josh Barro, Columnist

Neither the Private nor the Public Sector is Doing Fine

July 27, 2012 at 3:18 PM UTC

Josh Barro is the lead writer for the Ticker, Bloomberg View's blog on economics, finance and politics. His primary areas of interest include tax and fiscal policy, state and local government, and planning and land use. Previously, Barro was a Senior Fellow at the Manhattan Institute for Policy Research and a commercial real estate banker at Wells Fargo. He holds a bachelor's degree in psychology from Harvard and lives in Queens, New York.

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Today’s GDP data show roughly what was expected: Real GDP growth is estimated to have been 1.5 percent in the second quarter; the first quarter growth figure was revised upward from 1.9 percent to 2.0 percent. The economy is growing, but not nearly as fast as it should be. (Note, though these data are quarterly, all figures are annualized rates of change.)

The public sector continues to shrink; in the second quarter, government GDP declined at a rate of 1.4 percent. But even when you look at private sector figures alone, they are unimpressive: Real private sector growth was 2.4 percent in the second quarter and 3.2 percent in the first quarter.