Posted on 11/01/2003 8:55:13 PM PST by Utah Girl
The latest report on U.S. economic growth -- a gaudy 7.2 percent in the last quarter -- gives President Bush a legitimate opportunity to crow about his tax-cutting policies.
This Commerce Department report on the gross domestic product is considered the broadest gauge of economic health. But, unless these happy numbers start reflecting significant job growth relatively soon, President Bush and his Republican allies in Congress will have some explaining to do in 2004.
There is little doubt that the Bush tax cuts, particularly those child tax credit rebate checks that hit families' mailboxes just as they were shopping for back-to-school clothes, helped kick-start what had been a sluggish national economy. So did record-low interest rates, a result of decisions over at the Federal Reserve Board, and the resulting boom in mortgage refinancing.
But the tax rebates are spent, mortgage rates are creeping up and unemployment nationwide is still a distressingly high 6.1 percent. Even those folks who still have jobs find the cost of health insurance soaring, sometimes completely out of reach, while college tuitions and state and local taxes are rising.
All of those factors are bad omens for future consumer spending. And, with a growing federal deficit and spiraling costs of the war in Iraq, the federal government is hardly in a position to expand health coverage, subsidize education or bail out state and local governments.
And the Bush tax cuts, like his invasion of Iraq, have created a tiger-by-the-tail situation. Continuing the cuts -- or, as has been suggested, adding to them -- is sure to further increase the federal deficit, forcing the government to borrow more, which will suck up private capital and push up interest rates.
But repealing the cuts, or allowing them to expire, could be politically disastrous for whomever gets the blame. Just ask the president's father about that.
The economy is an unpredictable, and largely uncontrollable, beast. Presidents get unfair shares of the credit, and of the blame, for its behavior. Bush's hope, that economic growth becomes job growth, which in turn boosts federal tax revenue without raising tax rates, may yet come true.
If so, there's no reason why he shouldn't base his re-election campaign on a revived economy.
But, if not, we will have to deal with the fact that today's economic good news is built on a foundation of sand. Joblessness and growing federal deficits still threaten both the general economy and Bush's reputation for managing it. Meanwhile, things the president does not control, such as oil prices and interest rates, could undermine everything else.
It is, still, a jobless recovery. And that might threaten the president's job most of all.
we had the same situation last year with different kinds of rebate checks going out and that didn't kick start the economy... so what was different?? Oh yes, the tax rate changes took effect!!!!
It's not the bait & switch. It's the bait, bait, bait, and then switch until Nov. 2004. And the complaints are not even about real issues.
I would rather be a Broken Glass Republican than a Razor Blade Democrat. (The party of political suicide!)
[ (c) Copyright ChewedGum/King of Fools, 2003 ]
Which means that this was a piddly little recession.
For reference, the unemployment rate when Reagan took office was 10.8%.
So, all those Democrats out there beating their breast about "the worst economy in fifty years" (or "since the Depression", I heard one claim), have only to look back 22 years to the Jimmy Carter Era for their claims to be refuted.
Gaudy?
Yes, it's a guady, vulgar and tasteless recovery.
You mean the other 94%?
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