Posted on 10/06/2004 2:39:55 PM PDT by GaryL
Iraq won't win the election for John Kerry. He has to convince voters that George W. Bush has botched the economy. That's a tall order right now, with the unemployment rate down from 6.3 percent to 5.4 percent in a year. It's back where it was when Bill Clinton was re-elected in 1996.
Kerry has another problem. His debate with Bush on Friday comes the same day as a report that will almost certainly show powerful employment gains, including upward revisions from earlier this year.
Still, Kerry is trying hard, and two main themes will be on display during the debating to come.
Kerry says Bush is "the first president to lose jobs in our country in 72 years." This statement is both false and disingenuous. Franklin Roosevelt lost lots of jobs; so did Ronald Reagan. Both inherited bad economies from their predecessors--as did Bush.
The president was faced in his first year with a tech bubble that had burst, a terrorist attack that had killed 3,000 Americans and the worst corporate accounting scandals in history. None of these was Bush's fault; Clinton deserves at least some of the blame for all three.
The real question is how Bush handled the cards he was dealt. He did what any economist--Keynesian or supply-sider--would prescribe: cut taxes, increase spending and loosen monetary policy (really, the job of the Fed). All steps were taken quickly, and the economy has turned around.
The big job losses occurred at the start of the administration. The big gains have occurred in the past year.
The second theme that Kerry will push is outsourcing or offshoring--the hiring of foreigners by American companies. This accusation makes Kerry the first major-party presidential candidate in decades to spout a protectionist line on trade.
Outsourcing is a non-problem. The latest statistics show that of the 1.5 million jobs lost last year in mass layoffs, less than 1 percent were sent abroad. Daniel Drezner of the University of Chicago also points out that while 4,633 workers were laid off from offshoring in the first quarter, Kodak laid off 15,000 because of the growth of digital photography.
It is technology and competition that are costing--and gaining--jobs for Americans. When we have an edge over the rest of the world--as we do in many sectors, from entertainment to financial services--we gain from trade. When other countries have an edge over us--as they do in textiles, for instance--then we gain as well, as nearly 300 million Americans pay lower prices. That's the way trade works. It benefits both parties. Obstructing it would be a disaster.
My guess is that the emotional and cynical appeals that Kerry is making won't work--for the simple reason that the real economy is alive and well and getting better. "The U.S. will probably grow more in the second half than in the first," says David Malpass, chief economist for Bear Stearns. I agree.
The unemployment rate today is lower than the average of the past three decades. Household wealth has soared to a new record, and 69 percent of Americans own their own homes, the highest proportion ever.
Last week, the final figures for Gross Domestic Product in the second quarter were announced. GDP, the nation's total economic output, grew nearly 5 percent for the year. That's greater than in any 12-month period during the Clinton administration. Personal income is up 5 percent in the past year, and business spending is strong. Inflation is tame, and interest rates are low. Compare the United States with Kerry's paragons abroad. Unemployment in France is 9.9 percent; in Germany, 10.6 percent.
On Friday, statistics on employment will be released. August showed a gain of 144,000 jobs, but, because of the hurricanes, the increase could be smaller for September. But there should be a dramatic upward revision for past months as the Bureau of Labor Statistics reconciles the payroll survey, which shows a net loss of about 800,000 jobs during Bush's term, with the household survey, which shows a gain of 2 million jobs.
Kerry, through distortions and obfuscations, will try mightily to convince Americans that Bush has messed up the economy. If reality counts, he won't get away with it.
James K. Glassman is a resident fellow at the American Enterprise Institute.
Source Notes: This article also appeared in the Washington Times on October 6, 2004 (AEI print index no. 17422)
Even Cokie Roberts said last winter on ABC that she's amazed the economy is doing so well despite Kerry talking it down all the time.
He is truly reprehensible.
I was going to vote for Bush.
Then I lost my job so I was going to vote for Kerry.
But now I just got a new job, so I'm going to vote for Bush again.
Kerry wil argue its nopt the unemployment stupid its the under employment.
Bush should shoot back that " Kerry has nothing to offer but fear and loathing"
Flip flop flip
I hope the majority of voters aren't that myopic...
Wheee! I'm a waffle!!!!!
At least you're having a good time.
Dubya has jeopardized our National Security and sovereignty by plundering the Treasury and mortgaging our future.
Look if the unemployment rate was one percent and every worker got a million dollar bonus last year, the Dems would still be talking down the economy and doing their reprehensible class-warfare thing. That's all they ever do. The top Dems know that all the Dem class-warfare rhetoric is a pile of manure, but the people who vote for Dems don't know it. These are people, like a lot of my friends, family members, and co-workers, who have large expensive houses, vacation homes, multiple cars, state-of-the-art appliances, trips to Vegas, Mexico and elsewhere but who are jealous of people who have a few more bucks than they do. Every Republican-hating Dem I know is doing better than me, and I'm doing alright thank you very much.
Thanks for your interesting comments.
I think it was Limbaugh who said recently that the Democrats have actually become the party of the super rich and the very poor, while the Republicans have become the party of the middle class - the people who actually pay the taxes!
I hope this is true.
Heard some predictions on FOX that the jobs report might not be too good.
BUMP!
The economy is one of the greatest successes of this administration.
It is hard to believe that since our President was elected, the US economy has gone through the shock of 9/11 in addition to the major problems that resulted with the economy (Stock market lost $1.2 trillion in value that week, the economy probably lost between 2% and 5% that year due to that {200-500Billion$}, airlines were devastated and many nearly went under, direct cost to NYC estimated to be 100,000 jobs and cleanup costs at least 50BILLION dollars) plus the burst of the Clinton cyber-bubble with DoJ leading the charge by hammering Microsoft, the 'Toon-90s inspired Corporate scandals aftermath and that we have been able to finance and win nearly single handedly (economically) two wars in far off places in the process fighting off concerted efforts against us by some close "UN allies".
---whew... long sentence... breathe... ---
The American economy is a near miracle. I challenge nay-sayers to compare our growth and employment figures with France, Germany, and their other favorites.
This President deserves the Nobel Prizes for Physics, Economics, Chemistry, and Peace.
/
On the anniversary of 9/11 this year, Neil Cavuto had on the economists and Wall Street guys who were on his show a few days after 9/11/01.
At that time, they were all predicting that it would take 10 years for the economy to recover.
They all credited the Bush tax cuts and the strength of the US economy and the consumers who didn't abandon Wall Street in droves for the recovery.
Poke a hole in me, I'm done!
Seriously, the Kerry campaign would like us to believe, perhaps are trying to convince themselves that they have the unemployed vote sewn up. But it was funny, when I lost my job I became even more convicted that we MUST re-elect the President. And I think we will.
Historically, Americans have shown very good sense when electing wartime presidents. It's peacetime presidents we have a problem with. It seems to me that when we're at peace Government winds up with too much time on their hands. Corruption abounds and the partisan nastiness doesn't subside, but rather escalates over the petty and the picayune.
Rats are fond of squeaking "It's the economy, Stupid," but as usual that's only half the thought. They miss the caveat -- "except in times of war."
But, as the deep background Washington Source, none of this is news to you, I'm sure.
There is another saying that the only groups who don't have to care what anybody thinks of them are the very rich and the very poor. Think about it. It may have to do with why the rats can adopt certain tactics that the right are unable to match.
True, so true. I know much, but reveal little.
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