The numbers tell us the United States is out of recession. According to the US commerce department, America’s GDP grew at an annualised rate of 3.5 per cent in this year’s third quarter, following four straight quarters in which it shrank. But it may be too soon to beat the drums and bang the gongs of celebration. There are some questions to be asked first.

Does this constitute a broad-based recovery? Is it the case that American enterprises and American capital stand ready, again, to serve as the engines of world growth? Sadly, no. Breaking down the numbers makes it clear whence this growth derives: from the enormous resources that the US government has managed to mobilise to keep its economy from a spiralling free-fall into depression. The other components of growth haven’t really bounced back in sufficient degree to constitute a full-scale recovery. Look, for example, at consumer spending. Yes, it went up by over 3 per cent; but a big chunk of that was because of the US government’s “cash-for-clunkers” scheme, in which Americans were subsidised to encourage them to trade in older cars for newer ones with better fuel efficiency. Then consider the fact that in real estate, the sector in which the contagion began, residential construction went up rather dramatically, by as much as 23 per cent. But when that is put together with the fact that an $8,000 credit on federal tax for first-time home buyers has just been introduced, it makes more sense. The simple truth, therefore, is that crisis measures seem to be working — but that the crisis isn’t over yet. The patient is walking, but on crutches; so it is too soon to declare her leg healed.

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