Study Finds Greater Income Inequality in Nation’s Thriving Cities

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Off the Charts: Now It’s the Developed Nations’ Turn to Grow

During and after the Great Recession, developed economies tended to fare worse than emerging ones, and that was shown in the amount of business going to manufacturers and service companies in various countries around the globe. But in the last few months, that tide has turned. Companies in developed countries are more likely to be reporting growing business than are companies in emerging markets.

The accompanying charts look at trends in the most prominent developing countries — Brazil, Russia, India and China, the so-called BRICS — and four major developed regions, the United States, Britain, the euro zone and Japan.

They are based on the monthly surveys of companies taken by the Institute for Supply Management in the United States and by Markit in many other countries around the world. The surveys ask whether business is improving or getting worse, both over all and in a number of specific areas. The charts focus on the question of whether new orders are increasing or decreasing.

In each case, a figure above 50 shows that more companies are reporting rising orders than are reporting falling orders, and the higher the number, the broader the rising order trend. Similarly, figures below 50 indicate that a plurality of companies sees orders declining. Figures above 60 show widespread growth in orders.

For the first time in more than two years, the four developed regions shown in the graphic all reported rising orders for both manufacturing and service economies in August. There was still growth in some emerging markets, but Indian and Brazilian manufacturers reported falling orders in both July and August. The last period when both of those countries reported declines was March 2009, at the bottom of the worldwide credit crisis.

A simple way to compare the two groups is to average the four reported figures for developed countries and compare it to the average for the four emerging markets, which is done in the bottom chart. The developed-area advantage is the highest it has been since the Great Recession began in the United States in December 2007.

It is worth emphasizing that the figures are intended to show change, not the level of new orders. A company with booming business would presumably report a decline if the boom eased a little, while a struggling company could see a small gain from a low level.

Nonetheless, it is impressive that of the eight euro zone countries where surveys are taken of manufacturing companies, only France registered a figure under the neutral number of 50 in August, and that figure, at 49.8, was the best French manufacturers had posted in more than two years. Even Greece posted a positive figure, that first time that had happened in four years. Germany’s manufacturers, which reported order declines earlier this year, are again reporting increases.

Both the United States and Britain had figures above 60 for new manufacturing orders. That had not happened since the spring of 2010, when order books were still rebounding from the credit crisis. Similarly, the slip in new business has extended to many other emerging markets. While Chinese manufacturers reported a rise in new orders in August, the first such report in four months, the countries registering declines included Taiwan, South Korea, Indonesia and Vietnam. Their manufacturing exports run the gamut, from inexpensive clothes in Vietnam to cars and electronic products in Korea.

Floyd Norris comments on finance and the economy at nytimes.com/economix.

Obama Promotes Ambitious Plan to Overhaul Nation’s Infrastructure

At the end of a week absorbed by social issues like gun control and gay rights, the president returned to the economic challenges he has called his top priorities with a set of proposals to generate money for construction projects.

“What are we waiting for?” Mr. Obama asked, surrounded by massive cranes and cargo containers. “There’s work to be done. There are workers who are ready to do it. Let’s prove to the world that there’s no better place to do business than right here in the United States of America, and let’s get started rebuilding America.”

Expanding on ideas from his first term and this year’s State of the Union address, Mr. Obama proposed a series of tax breaks and loans to stimulate private investment. Among other things, new “America Fast Forward Bonds” would help state and local governments borrow money for projects, while foreign pension and retirement funds would have a tax penalty eliminated so they could invest in infrastructure in the United States on a similar basis as American funds. Grant programs that were part of the president’s stimulus program would be expanded by $4 billion.

Mr. Obama also promoted an infrastructure bank that would use $10 billion in public money to leverage private investment, a concept he has been pushing without success since 2011.

Republicans responded by saying they also wanted to upgrade American roads, bridges and other infrastructure, but only if it could be paid for. SpeakerJohn A. Boehner’s office distributed comments he made last month after Mr. Obama’s State of the Union address.

“It’s easy to go out there and be Santa Claus and talk about all the things you want to give away,” Mr. Boehner said. “But at some point, somebody has to pay the bill.”

Infrastructure has been one of Mr. Obama’s favorite talking points because its appeal often crosses party lines. Both labor unions and corporations favor more spending on airports, highways and the like, and both Republican and Democratic lawmakers are eager for projects in their districts.

Ken Orski, the editor of Innovation NewsBriefs, a transportation newsletter, said the president’s emphasis on private investment was important. “We need more of that kind of involvement, rather than exclusive emphasis on public financing,” he said.

In some ways, expanding private investment in such projects is a return to tradition, said Mr. Orski, a transportation official under PresidentsRichard M. NixonandGerald R. Ford. Going back to the 19th century, canals and toll roads were financed with private money, he noted. But the great flow of government spending during the New Deal and the creation of the Interstate highway system shifted assumptions.

So while some industries like freight rail, telecommunications and aviation have depended largely on private investment, other infrastructure financing has come largely from government sources. Now that sensibility is shifting again, with more private money in the past 20 years.

“Many people feel that the role of private capital in infrastructure has been de-emphasized too much and that more balance should be restored to the equation,” Mr. Orski said.

The latest national report card issued by the American Society of Civil Engineers this month on the state of bridges, roads, power grids, rail networks and other systems showed that the country’s grade had actually risen for the first time — but to a D-plus from a D. The group credited an increase of private investment and spending from Mr. Obama’s stimulus program.

PortMiami is in the midst of $2 billion in improvements, including a tunnel directly linking its facilities with the Interstate highway system. Workers are also dredging to provide access to larger vessels, reconnecting the port with the nation’s rail system, upgrading its cranes and strengthening its bulkheads. Some of the cost has been financed with federal loans.

“The Port of Miami is a tremendous example of how infrastructure investment can lead to economic prosperity,” said Gregory E. DiLoreto, president of the engineers’ society.

On Thursday, Gov. Rick Scott, a Republican, chided Mr. Obama during a conference call with reporters for following the lead of states like Florida.

“We’re certainly glad President Obama’s coming to the Port of Miami tomorrow,” Mr. Scott said, “but he’s late to the party on Florida port investments.” He said his administration had fronted part of the federal cost of the PortMiami project when Washington dawdled. “We could not wait for the federal government to come to the table with their share of the project,” he said

Peter Baker reported from Miami, and John Schwartz from New York.

Economic Scene: U.S. Economy Is Doing Well Compared With Other Nations

Today, Republicans around the country are largely campaigning on the president’s words. Conservative economists like Michael Bordo of Rutgers and John B. Taylor of Stanford have written columns for op-ed pages and blogs arguing that by the standard of previous American recessions, the economy should have rebounded much more strongly.

Running with this argument, Glenn Hubbard and Kevin Hassett, economic advisers to the Republican challenger, Mitt Romney, have accused the administration of providing a misguided short-term fiscal stimulus that ultimately contributed to a long period of below-par growth. And Mr. Romney has borrowed a tactic used by Ronald Reagan to defeat Jimmy Carter in 1980, using his acceptance speech at the Republican National Convention to intone “this president cannot tell us that YOU are better off today than when he took office.”

Whether you are better off today than in 2009 may not be the most useful question to ask about an economy emerging from its most severe downturn in 80 years. A more illuminating question is how we have done relative to other countries that were caught in the global financial cataclysm. By that standard, economic growth in the United States has done surprisingly well.

The president’s early assessment of our economic troubles was wildly optimistic. By the administration’s early forecast the economy would be growing by 4.6 percent this year. Instead, it is probably going to expand just over 2 percent this year and next. Economic production per person has not recovered to its level before the recession. Unemployment is still painfully high, at 7.8 percent. The share of the population with a job remains near its lowest in 30 years.

But glance across the Atlantic. The economy of the European Union will shrink by 0.2 percent this year, according to the International Monetary Fund. It is smaller than it was five years ago, while the American economy is 2.9 percent bigger. Even Europe’s most competitive countries are slipping. The Dutch economy is shrinking. Germany and Austria are expected to grow at half the rate of the United States this year and next.

Some will argue that Europe makes for an easy comparison. The European Central Bank held the economy back for many months by refusing to slash interest rates aggressively or pump money into the economy. Germany’s insistence that indebted Mediterranean countries cut government spending deepened recessions in those nations. And some other developed countries are growing faster than the United States: Canada, which didn’t have a banking crisis to begin with; Australia, a big exporter of raw materials that benefited greatly from China’s growth; the oil exporter Norway.

Yet the United States has recovered more quickly than other countries that don’t use the euro — including Japan, New Zealand, Denmark and Britain. The performance is all the more remarkable considering that the financial crisis that sent much of the world into recession was set off by American homeowners defaulting on their mortgages, taking down a big chunk of the nation’s banking sector.

The one crucial area in which the United States has performed worse than its peers is in jobs. Joblessness is at record highs in countries like Spain and Greece. But many European countries have done a much better job of protecting employment than the United States. In Austria, Germany and Belgium, the governments paid companies to put workers on short-time work rather than lay them off. Sweden also has a longstanding wage subsidy.

Alongside stronger unions and stiffer employment regulations that make it tougher to fire workers, these countries managed to prevent soaring unemployment. Total employment in Britain, Germany, the Netherlands, Austria, France and even Italy has recovered more since the financial crisis than it has in the United States. Though the United States has grown faster than France since 2007, the unemployment rate has risen higher here.

Yet the president’s critics are not suggesting the government should have subsidized wages or financed more public works. Rather, they have championed the type of budget-cutting policies that have played such a large role in thwarting economic growth in Europe.

Federal Reserve officials today concede they were too slow to respond to the crisis. The Fed was nonetheless far more aggressive than the European Central Bank, quicker to drop interest rates to zero and pump money into the economy, buying government debt and other bonds. Fiscal stimulus — an initial $800 billion package in 2009 followed by about $600 billion in payroll tax cuts and other efforts — was bigger and more sustained than in other advanced countries. Banks in the United States were forced to raise billions in new capital, which allowed them to cope with the turbulent financial markets better than their European peers.

Every step was an uphill battle. The Republicans who took control of the House of Representatives in 2010 argued that fiscal stimulus was wasted and counterproductive, and pressed for German-style austerity. During the Republican primaries, the Texas governor, Rick Perry, accused the Federal Reserve chairman, Ben S. Bernanke, of treason for debasing the currency by printing money to buy debt.

Today, most economists say they believe that these policies provided vital support to the economy. In its most recent World Economic Outlook, published this month, the I.M.F. acknowledged that the fiscal stimulus was probably much more effective at bolstering growth than it had previously allowed.

So where does this leave President Obama’s record? The Harvard economists Carmen M. Reinhart and Kenneth S. Rogoff, whose 2009 book “This Time Is Different” is the most comprehensive study of financial crises and their aftermath, contend that the comparison by Mr. Hubbard, Mr. Bordo and others is flawed. It mixes relatively mild recessions with deep financial crises that blew up the banking system. Recovering from the latter, they say, is painfully slow and difficult.

By Ms. Reinhart’s and Mr. Rogoff’s accounting, the Obama administration’s record on economic growth is pretty good: “If one really wants to focus just on United States systemic financial crises, then the recent recovery looks positively brisk,” they conclude. Among countries that suffered as deep a financial crisis as we did since 2008 — from Greece and Iceland to Germany and Britain — “the United States’ output performance is, in fact, among the best.” Even the American jobs market looks brighter when compared with other big financial crises in history.

Charles Dumas, chairman of the economic consulting firm Lombard Street Research in London, sees an American economy poised to rebound in the next presidential term. Household debt has fallen from its peak, and rock-bottom interest rates mean homeowners are spending only 14 percent of their disposable income on debt payments, the lowest level since 1992. The budget deficit is already down to 8.7 percent of economic output, from 13.3 percent in 2009. Even China is less of a problem, as high inflation has mostly eliminated its currency undervaluation.

According to most polls, President Obama is still the favorite to lead the country through such a rebound. If he loses in November, it won’t be because he provided too much fiscal stimulus. It will more likely be because on arguably the most important economic variable for American voters, jobs, he didn’t try hard enough.

E-mail: eporter@nytimes.com;

Twitter: @portereduardo