The U.S. Economy Grows by 1.8% in the Third Quarter of 2011

Economic growth is good news for the President and his economic team

In more good news for the U.S., the economy grew by 1.8% in the third quarter of 2011. The gross domestic product (GDP) numbers — the output of goods and services produced by labor and property in the United States — comes from the “third” estimate released by the Bureau of Economic Analysis.

This compares to second quarter GDP growth of 1.3%, but is revised downward from the second estimate of 2.0%. The increase in real GDP in the third quarter primarily reflected positive contributions from consumer spending, investments, exports, and federal government spending.

Negative contributors included drawdowns of private inventory investment and state and local government spending, and increases in imports. Despite the downward revision, the general trend of economic reports appear to be positive for the U.S.

The fewer claims accompanies data from earlier in the month showing the national unemployment rate dropping to 8.6% in November from 9.0% in October.

The fly in the ointment might be the political process, where the Republican-led House has created an artificial crisis in DC that may result in the reversion of the payroll to 6.2%, instead of the 4.2% level proposed by President Obama and a bipartisan Senate vote.