Carolyn Kaster, File, Associated Press
This would be the year when the global economy finally regained its vigor. At least that's what many had hoped.
It didn't happen.
The three largest economies — the United States, China and Japan — struggled again in 2012. The 17 countries that use the euro endured a third painful year in their financial crisis and slid into recession. Emerging economies slowed.
President Barack Obama defied predictions by sailing to re-election. And his landmark health care plan surprisingly survived Supreme Court review. Obama's re-election triggered a face-off with Republicans over averting the "fiscal cliff" — the drastic spending cuts and tax increases that were set to kick in Jan. 1.
The tech world dueled over smartphones and tablets and saw Facebook's IPO sour as fast as it had sizzled. The housing market inched toward recovery. And Americans suffered both a catastrophic drought and a catastrophic superstorm.
Least surprisingly, perhaps, another gallery of rogues brought investigative scrutiny to Wall Street.
The achingly slow global economic recovery was chosen as the top business story of the year by business editors at The Associated Press. The U.S. presidential election came in second, followed by the Supreme Court's upholding Obama's health-care plan.
1. THE GLOBAL ECONOMY: Worldwide growth was slack again in 2012. The global economy grew just 3.3 percent, down from 3.8 percent in 2011 and 5.1 percent in 2010, the International Monetary Fund estimates. The U.S. economy, the world's largest, failed to gain traction. Five years after a recession seized the economy and more than three years after it ended, growth in the United States was only about 2 percent. Unemployment remained a high 7.7 percent.
Europe fared worse. Its financial crisis did stabilize, thanks in part to the European Central Bank's plan to buy government bonds to help countries manage their debts. But the euro alliance sank into recession. Europeans, in turn, held back China, the world's No. 2 economy, by cutting back on Chinese goods. China's economy grew at a 7.4 percent annual rate in the July-September quarter. Though a scorching pace for developed countries, that marked a 3½-year low for China. And at year's end, Japan's economy, the world's third-largest, was shrinking.
2. U.S. PRESIDENTIAL ELECTION: Obama vaulted to a re-election victory over Mitt Romney, who had staked his bid on the weakest U.S. economic rebound since the Great Depression and had pledged to slash taxes. Unemployment under Obama topped 8 percent for 43 straight months.
Yet he won despite the highest unemployment rate of any president seeking re-election since World War II. Voters assigned him higher marks on the economy as the year progressed, perhaps encouraged by job gains. As the fiscal cliff neared, Obama fought to raise taxes on the highest-earning Americans. He also demanded aid for the long-term unemployed and money for roads, bridges and other infrastructure. Economists raised hopes that if the fiscal cliff was averted, the gloom would lift in Obama's second term.
3. OBAMA HEALTH CARE PLAN UPHELD: The Supreme Court caught many by surprise when it backed Obama administration's health care reform in a 5-4 vote. The law requires Americans to buy insurance or pay a tax, while subsidizing the needy. Hospitals and health insurers will likely benefit from 30 million new customers. Medical device makers, though, will face a new sales tax. And some small businesses say the law will discourage hiring because it requires companies to provide health care once they employ more than 50.