Opinion: Where Did All Those Economic 'Green Shoots' Go?

(Aug. 13) -- In an Aug. 2 op-ed headlined "Welcome to the Recovery," Treasury Secretary Timothy Geithner said that "we are on a path back to growth." Eight days later, the Federal Reserve issued a report saying the "pace of recovery in output and employment has slowed in recent months." The next day the Dow tumbled 265 points, and on Thursday initial jobless claims hit a nearly six-month high.

But don't blame Geithner for being Pollyannaish. Over the past year and a half, administration officials have issued one glowing statement after another about the economy, only to see reality turn out far worse.

In February 2009, for example, President Barack Obama released his first budget, predicting unemployment that year would be 8.1 percent -- actual result, 9.3 percent. In February this year, he said the economy had turned a corner, and in June said it "is getting stronger by the day." (In June, the economy lost 221,000 jobs.)

To be sure, the administration has hardly been alone. Way back in March 2009, Fed chairman Ben Bernanke was touting "green shoots" of economic recovery and saying it would "pick up steam" in 2010. And analysts and the press kept pumping up every sign they could find of growth. My favorite is a CNN report from May 18, 2009, headlined, "Job Recovery May Be on the Way."

Yet, despite all this encouragement, the economy has stubbornly refused to buck up. (See the timeline below.)

There's nothing wrong with a little cheerleading. But there's a real danger with all this "turning the corner, things are getting better, recovery is on the way" talk. If you don't think so, just ask Herbert Hoover, who infamously claimed that "prosperity is just around the corner" right before the worst of the Great Depression.

At some point, someone is going to have to level with the American people about just how bad things really are and why, despite all the ministrations from Washington over the past two years, they don't seem to be getting much better.

A Timeline of Pollyannaish Economic Prognostications

Unemployment chart showing the monthly unemployment rate from Jan. '09 to July '10.

Source: Bureau of Labor Statistics

A) Obama budget predicts that the unemployment rate for 2009 will be 8.1 percent (actual rate is 9.3 percent), and says it will be 7.9 percent in 2010 (average so far: 9.7 percent). -- Feb. 26, 2009
B) Fed Chairman Bernanke says he sees "green shoots" of U.S. recovery, which, he said, would "pick up steam" next year. -- March 15, 2009
C) Obama says, "We are beginning to see glimmers of hope." -- April 14, 2009
D) CNN reports that "Job Recovery May Be on the Way." -- May 18, 2009
E) Jeffrey Kling of the Brookings Institution says, "It seems clear the U.S. economy has turned a corner." -- June 5, 2009

F) Bernanke says recovery is under way and "prospects for a return to growth in the near term appear good." -- Sept. 16, 2009
G) Obama says, "We are seeing the corner turn on the economy growing again." -- Feb. 7, 2010
H) Obama says, "The worst of the storm is over. ... We are beginning to turn the corner." -- April 3, 2010
I) Obama says, "The economy is getting stronger by the day." -- June 4, 2010
I) Vice President Joe Biden dubs the months ahead "Recovery Summer," and David Axelrod adds that "this summer will be the most active Recovery Act season yet." -- June 17, 2010
I) Obama declares the economic recovery is "well under way." -- June 29, 2010
J) White House press secretary Robert Gibbs says, "The economy is getting stronger." -- July 8, 2010