This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

'This Is Not a Recovery at All': Stanford's Lazear




By Bruno J. Navarro, Producer

NEW YORK (CNBC) -- The U.S. economy grew at a rate of 2.4% since the second half of 2009, which hardly represents a comeback, Stanford University economics professor Ed Lazear said Wednesday.

"The problem is, this is not a recovery at all," he said on CNBC's "The Kudlow Report." "We haven't made up for the lost ground, and that's unprecedented."

Lazear, who also chaired President George W. Bush's Council of Economic Advisers from 2006 to 2009, authored a Wall Street Journal op-ed piece this week, titled, "The Worst Economic Recovery in History," in which he used historical data to argue that the current period of growth is anemic at best.

More from CNBC
Mitt Romney Not 'Apologizing for Success'
Which Is Fairer: 'Buffett Rule' or 'Romney Rule'?
NBC Makes Smart Move By Streaming Olympics

In the article, Lazear writes: "The Great Depression started with major economic contractions in 1930, '31, '32 and '33. In the three following years, the economy rebounded strongly with growth rates of 11 percent, 9 percent and 13 percent, respectively."

The New Deal, which involved a series of economic measures implemented from 1933 to 1936, did not figure into Lazear's arguments.

Instead, he focused on lagging growth in the postwar period to the current recession, from 1947 to 2007.

During that period, he wrote, "the average annual growth rate for the U.S. was 3.4%. The last three decades have experienced somewhat slower growth than the earlier periods, but even in the period 1977-2007, the average growth rate was 3%.

Lazear cited the private nonprofit National Bureau of Economic Research, which determined that the recovery began in the second half of 2009.

"Since that time, the economy has grown at 2.4%, below our long-term trend by either measure," he wrote. "At this point, the economy is 12% smaller than it would have been had we stayed on trend growth since 2007."

Asked by host Larry Kudlow for his take on the Dow Jones Industrial Average -- up more than 13% over the past six months, and 18% over the past two years -- Lazear said that hardly represented a recovery.

Lazear noted that the Dow was near 14,000 pre-recession and now struggles to maintain 13,000.

"It's four years later," he said. "We should be is approximately 12% better, and we're not."

Lazear laid blame for the economic sluggishness with the Obama administration's policies on trade, taxes, regulation and health care, all of which "have not been conducive to business growth."



--Written by Bruno J. Navarro at CNBC.

CNBC is a world leader in business news, providing real-time financial market coverage and business information.

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,109.68 +2.98 0.02%
S&P 500 2,001.51 +1.49 0.07%
NASDAQ 4,574.4870 +3.85 0.08%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs