ONLY ONE THING can stall the U.S. economic recovery that is now underway: a major policy error by America’s politicians. And, unfortunately, they have two such blunders in mind, namely protectionism and fiscal profligacy. The economy itself continues to grow, although not at the breakneck 7.2 percent pace that has been reported for the third quarter (that figure will be revised upward this week to something like 8 percent). The housing market is a principal driver. In October housing starts rose 2.9 percent from the previous month’s level. Construction was started on more new homes than in any month since January of 1986.

And the index of leading economic indicators rose by 0.4 percent, twice the rise predicted by economists. This index predicts–imperfectly, needless to say–the course of the economy in the next six months. One thing seems certain: The housing sector will do its bit to keep the economy moving along. Inventories of unsold homes are low, as are mortgage interest rates, which last week dropped from 6.03 percent to 5.83 percent on 30-year mortgages. The improving jobs market should increase both consumer confidence and wage income. Applications for building permits, a good indicator of future building activity, rose in October by 5.2 percent.