While debating how much austerity outside of the magic no-budgetary-impact spending on the Pentagonto enact, the United States could take a lesson from, well, from the rest of the developed world. The relative lack of austerity in the US compared to Britain and the rest of Europe led to better economic performance (and it’s important to say “relative,” because US fiscal policy turned negative for growth at the federal level in 2010, and at the state and local level it’s been full-speed ahead for austerity since 2008).

Ben Bernanke’s speech on the economy today offered no new information. It was more of an overview on the state of the economy, and it hit on many very familiar themes which Bernanke has expressed for a long time now, including the need to loosen lending standards in a type of reinflation of the housing bubble, which infuriates me. But give Bernanke credit for actually depicting the economy as it is rather than as someone hopes it to be; a weak economy with troublingly high unemployment. In other words, the wrong time to engage in a fiscal cutback through austerity.

A series of economic data released today has pretty bad news for those hoping for a sustained recovery that will increase job and GDP growth.

The Conference Board’s Consumer Confidence index shot up today, rising from 61.3 in August to 70.3 in September. This typically correlates with a brighter outlook for the economy, and could lead to stronger consumer spending. However, it may be worthwhile to ignore the Conference Board’s index in the last couple months of an election cycle.

The great middle class, the group lauded in campaign ads by every politician in the country, is wasting away according to a Pew study. Using the broadest possible figures (between 67% and 200% of the national median income), the study shows that the middle class has declined to a bare majority of the population. Furthermore, those remaining in the middle class have suffered the worst decade in post-war history.

Fatster rounds up news articles from all over, including stories and links about, BP’s losses, consumer spending, feckless Fed, rich are richer, voter confusion, GOP’s Fast and Furious misdirection, John Boehners economics, Bob Kerry, kiss my ass, Rick Scott, Dick Cheney, GOP v. Planned Parenthood and more.

Retail sales fell for the third straight month in June, a rare event that usually happens during recessions. With 70% of the US economy coming from consumer spending, it’s almost axiomatic that slower retail sales correlates with economic contraction.

In a paper for the Center for American Progress, Scott Lilly looks at the “swiftly ticking time bomb” that is the discretionary trigger. First of all, he finds that many contractors have already begun planning their budgets as if the cuts will happen, which will dampen spending at the end of the current fiscal year, starting in just a couple weeks, on July 1. He adds that the threat made by defense contractors also applies to the discretionary side.

In many ways this is the best economic data since the beginning of the recession. The Labor Department reports that unit labor costs have risen above the level of inflation for the first time since the end of 2008. And much of that can be attributed to higher wages, according to the Wall Street Journal.

The minimum wage will increase in eight states and several localities across the country. In these states, the minimum wage is indexed to inflation, a campaign priority of Barack Obama back in 2008 that never got past the formative stage. This can actually have a pretty decent impact, if a small one in macroeconomic terms, and a significant increase in the minimum wage would be even better.