PORT WASHINGTON, N.Y. (MarketWatch) — Although you wouldn’t know it from the way the stock market has been behaving over the past month, the economic outlook appears to be brightening.

Prosperity may not yet be just around the corner, but a growing number of economic statistics suggest that growth is shifting into a higher gear.

It’s not “Happy Days are Here Again.” It’s not even “Morning in America.” Rather, it’s more like the glass is no longer half empty — it’s half full.

What makes this step-up in economic activity even more interesting is that it is occurring just the way the textbooks say it should.

Let’s start with the consumer, whose spending, as you know, accounts for about 70% of the nation’s gross domestic product.

Because of the recession and the high unemployment it has left in its aftermath, consumers cut back their demand for a wide variety of goods and services. The annual rate of personal consumption expenditures in this year’s third quarter was only 2% above 2007, translating into an average annual increase of 0.5%.

This softness in demand has caused most prices to fall.

Commodity’ prices are well off their peaks and are still declining. For example, industrial raw materials are 15% below year-ago levels, according to the Economist magazine. Meanwhile, the Labor Department reports that wholesale prices dropped 0.3% in October alone, leaving them barely above last year’s levels.

These price declines have enabled retailers to cut retail tags without eating into their profits. As a result, shoppers have been getting the discounts they’ve been waiting for and have reacted accordingly. Retail sales rose a faster-than-expected 0.5% in October on the heels of a whopping 1.1% jump in September.

Debt panel fails to reach deal

Since these purchases constitute half of all consumer spending and thus one-third of personal consumption expenditures, if this pace continues this month and next, it will lift this quarter’s GDP growth to 3% or even more. The economy hasn’t grown at this clip since early 2010.

Because people have stepped up their purchases during the key holiday shopping season, merchants have already begun to order more goods for the next season in order to capitalize on this newfound buying mood. As a result, many firms have suddenly realized that they need more employees.

That’s why, after hovering above the 400,000 level for many weeks, the number of first-time claims for unemployment insurance dropped below this key level two weeks ago, ending up last week at 388,000 — the lowest in quite some time.

On the employment side, private-sector payrolls have started to recover a lot of the ground lost during the recession. And as you might imagine, the more people that find work, the better their mood will be and the more they will spend. As purchases push higher, retailers will order more, and so it goes.

At this point you’re probably thinking: What could go wrong? What could cause Rosy Scenario to take a hike?

I’ll tell you what could go wrong — the same thing that blitzed the markets a few months ago. It’s politics and the inability of the pols on both sides of the aisle to get along.

The failure of the supercommittee to agree on a plan to cut the nation’s long-term debt epitomizes this dilemma.

The “Occupy” protesters would do themselves and the country a lot of good if they shifted their demonstrations to Washington. Maybe then the pols will listen. If not, we will have to wait until the next elections to make our voices heard.