Is This GDP Growth Better Than Nothing?

Last month the Commerce Department’s Bureau of Economic Analysis produced some shocking news: advance figures showed that the United States economy unexpectedly shrank by 0.1 percent from October through December. But according the revised estimate, real gross domestic product grew at a rate of 0.1 percent in the fourth quarter, a decided improvement to the previously reported figures, yet still missing the 0.5 percent growth analysts had expected.

“While today’s release has revised the direction of change in real GDP, the general picture of the economy for the fourth quarter remains largely the same as what was presented last month,” commented the news release, putting the numbers in harsh perspective.

As the BEA reported on Thursday, GDP — the output of goods and services produced by labor and property located in the United States — reflected contributions from personal consumption expenditures, nonresidential fixed investment, and residential fixed investment that were only partly offset by negative additions from private inventory investment, federal government spending, exports, and state and local government spending.

This most-recent calculation of GDP still represents a deceleration in economic growth. In the third quarter, the U.S. economy grew at rate of 3.1 percent…