Happy Days Are Here Again: Economy Grows at 2 Percent, Sort Of

This might be good news for President Obama in his effort to secure re-election: The Commerce Department reported Friday morning that the economy grew at 2 percent during the third fiscal quarter—slightly better than expected, and a higher rate of growth than the 1.3 percent rise in the second quarter. One bit of interesting news: A big chunk of the growth came from an uptick in defense spending by the federal government—without it, the economy would’ve grown just 1.4 percent during the quarter. That’s OK, though! Government spending doesn’t create jobs, unless they’re defense-related jobs, in which case Ronald Reagan’s ghost gives it his free-market blessing. The downside? The upcoming “sequestration” may sharply cut defense spending after the first of the year, meaning all that growth will go away. Which is one reason President Obama has promised it won’t actually happen. [The New York Times]