US economy slows with high cost of gas
Image by Getty Images via @daylifeExpansion in gross domestic product (GDP) is expected to have slowed to 1.8pc in the first quarter of the year from the 3.1pc seen in the final three months of 2010, according to Wall Street economists.Think of how much worse it would have been if the Obama administration had passed the cap and trade bill. Their strategy of driving up the cost of energy to make less efficient alternative energy look competitive has been a disaster. Their strangling of domestic production has been a huge mistake.
Most point out that a combination of higher oil prices, a particularly harsh winter in the US and the earthquake in Japan all proved unexpected constraints on a quarter that in December was forecast to provide further evidence of a strengthening recovery.
"Things are not looking that good," said Yelena Shulyatyeva, an economist at BNP Paribas, which is predicting that the US will see growth at 2.5pc this year. "The situation has changed."
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The biggest headwind for an economy still largely based on consumer spending is the rise in petrol prices, which climbed to the highest level in almost three years last week.
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It is pretty clear that Obama's intellect has been overrated. He seems to b e under the impression that he can repeal the laws of supply and demand when it comes to energy. The GOP will be hammering him on the energy front in the coming weeks. They are going to have to keep at it because the media is trying to give him a pass.
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