The Bureau of Economic Analysis reported today that the U.S. economy contracted at a 0.1 percent annualized rate in the last quarter of 2012. While this quarter’s contraction likely does not signal a return to recession (it was driven by decelerating inventory investments and a very large reduction in defense spending, which are not likely to be repeated in coming quarters), the economy had grown at an average rate of just 2.1 percent for the first three quarters of 2012, which is not fast enough to lead to rapid improvements in the nation’s job situation. Today’s data emphasizes the need to reorient the policy debate back to growth and jobs and away from rapid fiscal contraction.