The Economy
Early on, it looked like 2011 would finally be a year of recovery. The unemployment rate dropped to its lowest level in two years. In mid-February, the Federal Reserve upped its growth outlook, predicting the U.S. economy could grow as much as 3.9%. Then came rising oil prices, the Japanese nuclear disaster and a series of confidence-killing Washington budget showdowns. By mid-year the unemployment rate was rising again, and economic growth had slowed to 1%. What also became clear in 2011 was that not everyone had been equally hurt by the recession and its aftermath. Corporate profits and CEO salaries were on the rise again. Earnings at high-end retailer Tiffany jumped 40%. Meanwhile, the portion of the nation's 14 million unemployed who had been out of work for more than six months reached 42% — a post World War II high. Worse, there was a growing sense that Washington could do — or was willing to do — little about it. The stimulus money has been mostly spent, and Obama's plan to extend the payroll tax cut has been getting a cold reception in Washington. Recently, the economy has shown some signs of life — the unemployment rate is dropping again and the holiday shopping season has started off stronger than expected — but probably not enough to help those still struggling to find work.