Courtesy of Pam Martens
By Pam Martens and Russ Martens: May 17, 2017
When the Commerce Department released its data on April 28 for Gross Domestic Product (GDP) in the first quarter, it signaled the slowest growth in three years. The economy had grown at a tepid 0.7 percent annual rate as a result of weak consumer spending. The individual consumer matters greatly to growth in the U.S., accounting for more than two-thirds of economic activity. In the first quarter, consumer spending registered at a 0.3 percent rate, a pace not seen since the depths of the financial crisis in the fourth quarter of 2009.
It is perhaps ironic that the 1 percent in America control Washington through lobbyists and a perverse campaign finance system but the 99 percent, the consumers, control the economic fate of the country. If consumers lose confidence in the country’s leadership, they will retrench from spending in order to build a larger cash safety net for a potential downturn.
There has now been a solid week of confidence-draining news swirling around the President of the United States, Donald Trump. It began last Tuesday evening with the President’s firing of FBI Director James Comey, who had testified before Congress that he had an open investigation of the Trump campaign’s ties to Russia. That was followed by what seemed like an admission from the President in an NBC News interview that he had Comey’s Russian investigation on his mind when he fired him – leading to endless media comparisons to Watergate.
Next came the news that on January 27 President Trump had held a one-on-one dinner with Comey in the White House where he had asked for a pledge of loyalty from the FBI Director. (The FBI Director owes his oath of loyalty to the American people, not to any elected politician.)
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