The word "unexpectedly" for negative economic reports has become a much-mocked cliché in the media over the past five-plus years of recovery, but this week's final look at first-quarter economic growth deserves an exception. First estimated at a meager 0.1 percent annualized rate, and then downwardly revised to -1.0 percent in May, most economists expected a smaller revision to the downside – in the -1.5 percent-1.8 percent range.
Instead, the Bureau of Economic Analysis calculated the drop as -2.9 percent, a full three percentage points lower than its initial estimate, and the worst quarter since the technical recovery began in June 2009.
Almost immediately, the Obama administration and its apologists began insisting that the sharp decline meant nothing. Cold weather caused it, some claimed, even though the US has had cold winters in the past without suffering undue economic damage. In fact, this was the worst Q1 read on GDP in 32 years (1982), and the three winters following that produced annualized growth rates of 5.3 percent, 8.2 percent, and 4.0 percent. This was hardly the first tough winter America has faced in terms of weather, but it was the worst in decades economically.