The new monthly jobs report wasn't quite as strong as some had hoped, but it wasn't necessarily awful news, either. As Matt Yglesias noted, "[M]ake no mistake -- this economy is growing and has been growing steadily for months. It's not booming and it's not undoing the damage of the prolonged labor market weakspot, but it's definitely growing and the situation is definitely improving."
I think that's right, but I also wonder whether Congress will screw it up.
Sen. Joe Manchin (D-W.Va.) said something the other day that stuck with me: "Something has gone terribly wrong, when the biggest threat to our American economy is the American Congress."
That's profoundly true. Americans elect officials to serve and advance their interests, not act against those interests, and yet, arguably the single greatest threat to a more robust economic recovery in 2013 is posed by congressional Republicans.
Last week, before the fiscal agreement was crafted and approved, Neil Irwin reported:
The pieces are in place for 2013 to be a year of solid economic gains. But the big, dark cloud on the horizon is located right in the middle of the District of Columbia. Look for the building with the giant dome.
It is not simply that the federal government could mess up what should, by all rights, be a good year. It is that there are so many different ways that government policy could mess things up, a long menu of options for how things could go awry in Washington, with gloomy consequences across the United States. As economists at Goldman Sachs put it in their title to a research note last week, the story of the United States in 2013 is one of "Economics vs. Politics" -- and the open question is: Which one will prevail, the improving economic fundamentals or the rapidly deteriorating political fundamentals?
For what it's worth, Irwin pointed to three specific steps Congress could take to screw things up, and one of them -- the Dec. 31 deadlines popularly known as the "fiscal cliff" -- has already passed. The other two threats -- debt-ceiling "hijinks" and "too much austerity" -- remain in place.
Taken together, there's reason for some economic optimism in 2013, just so long as the congressional Republicans voters put in office don't deliberately make things worse.