CAN PUBLIC HAVE CONFIDENCE IN ECONOMY WHEN MEDIA LIES ABOUT IT??

GOPUSA ^ | 8/1/02 | MARY MOSTERT

[Elkiejg]

"The American economy -- our economy -- is built on confidence, the conviction that our free enterprise system will continue to be the most powerful and most promising in the world," President George W. Bush said in a news conference in early July on "Corporate Responsibility." There is little doubt that the recent rash of record-breaking bankruptcies, WorldCom, (Enron at $107 billion, Global Crossing at $63 billion, Financial Corporation of America at $33 billion, and Adelphia Communications at $24 billion) have rattled many people's confidence in the economy.

However, the public's perception of what is going on in the economy is often affected by how the media reports what is going on in the economy. On the same day that Al Gore finally admitted defeat in the November 2000 election we began to hear, for the very first time in eight years, the dreaded "R" word -- recession. Recession was never mentioned during no fewer than five major downturns in the stock market during the Clinton years.

And, in spite of claims of "non-partisanship" after 9-11, by late November 2001 the Democrats were unveiling to their friends in the media their plan to recapture the Congress in 2002. Kathy Kiely and William M. Welch, of USA TODAY reported "At a breakfast meeting with USA TODAY and Gannett News Service reporters and editors, Democratic Congressional Campaign Committee chairwoman Nita Lowey said the time is right to make an issue of the economic downturn.

Obviously, the Democrats expected the media to give them a lot of free press on the issue of the economy when they invited them to that breakfast meeting, and the economy has been on the front burner ever since. But, based on the above bankruptcies, by huge multi-national companies that were such an integral part of the so-called "Clinton Economic Boom," was it really a boom when the figures on which it was based came from fraudulent accounting? Just the four above mentioned companies, covered up to $227 billion in losses with deceptive accounting. If we remove the bankrupted billions and report real gains in the Gross National Product, what would become of the so-called "Clinton Boom?

What we now realize was taking place in the 1990s in such companies was billions in borrowed money being spent to pay labor costs that were not creating profitable services or products. This is, of course, deficit spending. The so-called "Clinton Boom" appears to have been built on a new kind of deficit spending, in which money seemed to flow generously to Democrat campaign coffers while tax money was flowing generously to help those companies have an advantage over their competitors through the Clinton Commerce Department.

If we just look at facts, rather than media hype, what do they show about the state of the economy in the various administrations in the last part of the 20th century? If we look at the Stock Market in the last 18 months of the last five presidential administrations, when their policies would have had time to take effect, we might get some clues as to which of the administrations actually were in the saddle when events took place that increased, or decreased, the values on Wall Street.

Going back to the last 18 months of the Jimmy Carter administration we find that on July 20, 1979 the stock market closed at 828.10. On January 20, 1981, the day Reagan was inaugurated, the stock market closed at 950.70, a 14% increase. This was in the era of stagflation -- inflation, and a sluggish economy.

From January 20, 1981 to October 2, 1987 the stock market, under Reagan, increased from 950.70 to 2641, approximately a 178% gain. In the last 15 months of Ronald Reagan's administration there was a loss of 8%. When Ronald Reagan left office on January 20, 1989 the stock market closed at 2235.40. The media seemed to use more ink reporting the 8% loss than the 178% gain.

During the Senior Bush administration, the stock market continued to climb, in spite of the fact that the media and Bill Clinton, during the 1992 election campaign, claimed we were in the "worst economy since the Great Depression." Time Magazine described the last 18 months of the senior Bush's administration as a time when the economy "kept dragging along the bottom for the duration of the campaign." However, the facts show that on July 22 1991, 18 months before George H.W. Bush's administration ended, the stock market closed at 3013. On January 19, 1993, the day before Clinton was inaugurated, the stock market closed at 3256.00 -- an 8% increase in 18 months.

And what was the economy doing the last 18 months of the Clinton administration when he and his friends were claiming a "legacy" based on a "booming economy?" On January 18, 2001, the last trading day of the Clinton Administration, the stock market closed at 9771.90, a 9.9% LOSS from its July 20, 2000 close of 10,843.90. While he clearly inherited a market on the upswing and over the first 6 years of the Clinton administration the stock market increased 214%, in the last 18 months, it was headed down. In fact, it appears as one large company after another declares bankruptcy, that some of that increase was based on fraud and favorable treatment for business tycoons who contributed to Clinton's campaigns, such as Enron and companies in Indonesia connected to General Suharto's regime and businesses.

While the American media has barely mentioned it, the collapse of Enron resulted in large measure from the collapse of its overseas ventures in Indonesia and its Daphol Power plant in India, which was approved only after the Clinton Administration threatened ending all U.S. investments in India if the plant, which would charge 4 times what the Indians were accustomed to paying for electricity, was not approved. The Indian government reluctantly approved the construction, but the local Indians would not buy the electricity and the plant was closed down.

While the Democrats hope their friends in the media will help them blame George W. Bush for the falling stock market, Bush has called for corporate reforms that may steady the nerves of some skittish investors:

Expose and punish acts of corruption;
Hold corporate officers more accountable;
Protect small investors and pension holders;
Move corporate accounting out of the shadows;
Develop a stronger and more independent corporate audit system; and
Provide better information to investors.

It sounds good. However, unless the public elect people of integrity and character to run their local, state and national governments, it's not likely that we can expect much confidence in either the markets OR government.

[Elkiejg]

Good article - amazing when the FACTS are presented. Feel free to pass this onto your local media!!

[NC Conservative]

The infobabes wouldn't know a stock from a bond. My four year old knows more than them. Smart people ignore the media.