Maven: GDP Gross Out

Back in March, the Commerce Department revised its estimates of the previous quarter's growth. You may recall that I got all hissy about this same subject then.

See, initially the growth for the fourth quarter of 2005 was put at 1.1%, which caused panic-mode headlines about the nation being on the cusp of recession. That little detail about the possibility (nay, near certainty) of upward revision? Almost always buried deep within articles in a butt-covering little mention like "initial government estimates of economic growth are frequently revised higher."

Are they ever! And higher doesn't even begin to describe what happens. The fourth-quarter number was later ramped up to 1.6% -- almost a 50% increase.

Look: 1.6% growth is still no great shakes. But a nearly 50% markup renders the first wave of imminent-recession stories pretty useless. You'd a thunk the business media, those short-sighted little devils, would have learned their lesson when the same thing happened a year earlier.

No such luck. It seems that when the business media gets egg on its face, it merely wipes it off to make room for the next egg.

Look at the fourth quarter of 2004, when we got a lot of headlines about how economic growth had slowed from 4% the previous year to 3.1%. That's a pretty significant drop, no? Well, no. Revisions came out and guess what? The economy had actually grown at a 3.8% rate, a rock skip or rounding error from 4%.

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