Economy is kick-started, but can it motor ahead?
Over the past year, the U.S. government has thrown almost every tool at its disposal toward making the economy grow again. And it has worked, at least for now.</br></br>The trillion-dollar question for the economy now is: What will happen when those government supports are gone? While the government has successfully jump-started the U.S. economy, there are emerging signs that its engine still isn't running very well, and may even sputter out.</br></br>The government has deployed about half of $787 billion in spending and tax cuts that were part of its stimulus package. It has executed the "Cash for Clunkers" program that boosted auto sales over the summer, and it has taken a wide range of steps to support the housing market. The Federal Reserve, besides cutting its target interest rate to nearly zero, has committed $1.75 trillion to unconventional programs meant to reduce interest rates.</br></br>The combined results of all those efforts will be on display Thursday, when the Commerce Department reports on gross domestic product for the July through September quarter. Economists expect that broadest measure of economic activity to have risen at a 3 percent annual rate, compared with a 6.4 percent drop in the first quarter, and forecasters expect growth to continue through year's end.</br></br>"The patient is out of intensive care, but is still highly medicated," said David Shulman, senior economist at the UCLA Anderson Forecast. "So you don't know how much of this growth is driven by short-term stimulus and how much of it is self-sustaining. My guess is this is going to be the best quarter of growth for a long time."