Consumer spending ticked upward in October in a marked reversal from the previous month, according to a Commerce Department estimate Wednesday.

The 0.7% increase--0.4% when adjusted for inflation--follows a 0.6% decline in September.

Democrats immediatly seized on the news, hoping to beat back Republican attacks that the party in power has failed to guide the economy through recession.


The DNC blasted an email to reporters touting the numbers, and the Commerce Department released a statement citing the spending increase, as well as a slight increase in personal income, as results of government policy.

"The strength of the holiday sales is not clear yet, but strong growth in government benefits and a large drop in personal taxes so far this year have enabled households to increase spending and also improve their financial position by paying down debt,” said Commerce Under Secretary Rebecca Blank.

Meanwhile, claims for unemployment benefits fell last week to their lowest level in over a year, giving Democrats another piece of data to tout in the days ahead.

The good news comes a day after some dour reports. Commerce on Tuesday re-adjusted estimates on third quarter growth, reporting that the economy grew at a 2.8 percent clip between July and October, not the 3.5 percent growth initially estimated. Separately, the Federal Reserve predicted unemployment would remain high for several years.

For months Republicans have hammered Democrats on the economy, pointing to the double digit unemployment rate as evidence that the $787 billion economic stimulus package signed by President Barack Obama failed.

Democrats have insisted that the economy would be worse without the $787 billion package, but are nevertheless afraid that a bad economy will lead to big losses in 2010's mid-term elections.

Congressional Democrats, for example, are planning to sell a new economic package as a "jobs bill" rather than a "stimulus," fearful that the original legislation is perceived as a failure.

Worries about the economy were also reflected in the demands by members of the Congressional Black Caucus to put off financial regulatory reforms until more is done to help minority communities suffering through the recession.