Clinton-cooked books?

WASHINGTON -- The Commerce Department's painful report last week that the national economy is worse than anticipated obscured the document's startling revelation. Hidden in the morass of statistics, there is proof that the Clinton administration grossly overestimated the strength of the economy leading up to the 2000 election. Did the federal government join Enron and WorldCom in cooking the books?

Through all of President Clinton's last two years in office, the announced level of before-tax profits was at least 10 percent too high -- a discrepancy rising close to 30 percent during the last presidential campaign. Most startling, the Commerce Department in 2000 showed the economy on an upswing through most of the election year while in fact it was declining.

Although a political motive for Democratic cooking of the government's books is there, nobody -- including Bush administration officials -- alleges specific wrongdoing. Nor is there any evidence. Estimation in 2000 was conducted by career public servants who are doing the same jobs today (working under a highly political Democrat in the Commerce Department). Nevertheless, such discrepancy in earnings statements by corporate executives today would warrant a congressional subpoena.

The Commerce Department's Bureau of Economic Analysis quarterly estimates before-tax profits of domestic non- financial corporations, releasing the information the last week of the month following the quarter. Revised figures last week showed profits were really lower by 10.7 percent, 12.2 percent, 15.2 percent and 18 percent for the four quarters of 1999. In 2000, this gap became a chasm. The revised quarterly profits for the election year are lower than the announced figures by 23.3 percent, 25.9 percent, 29.9 percent and 28.2 percent.

Most startling, original estimates showed a generally rising profit outlook for the two years preceding the election. Starting with $503.7 billion in the last quarter of 1998, the quarterly estimates rose steadily to $543.8 billion in the fourth quarter of 1999 and then took off in the first two quarters of 2000 to $574.9 billion and $606.6 billion, leveling off to $602.9 billion in the third quarter (before falling to $527.3 billion in the fourth quarter after the election).

Last week's revised returns reflect not only different numbers but a different trend (starting at a much lower level of $473 billion). Profits actually fell through much of 2000, dropping from $449.7 billion to $422.4 billion for the second half (before slipping to $372.8 billion).

How could there be this big of a discrepancy? How could the government have reported steadily rising profits when they actually peaked in 1998?

"The gap is a bit larger than usual, but not really out of line," Brent Moulton, associate director at the Bureau of Economic Analysis, told me. Moulton, who was in charge of both the old figures and the new revision, said the problem was the two-year delay in obtaining corporate tax returns (reflecting changes in telecommunications and business services).

Moulton's boss in 1999-2000 was one of the Clinton administration's most politically astute economists: Under Secretary of Commerce Rob Shapiro, a pioneer "New Democrat" and early friend and supporter of Bill Clinton. I asked him flatly: "Did you cook the books?" Shapiro laughed it off, asserting that the Bureau of Economic Analysis is "the most non-political, non-partisan agency in the government."

That begs the question of whether the bureau's very political, very partisan management chief should have known the bureaucrats were on the wrong track. "No," said Shapiro, "2000 looked very good to us." He dismissed the early reports as "an econometric projection based on estimates."

The result: headlines in 2000 spewing false information of corporate profits growing at 25 percent, bolstering the stock market and holding up the state of the economy as the election approached. That is the underpinning for the Democratic myth that a growing and vibrant American economy has been sabotaged by President Bush's tax cut ("We lost the opportunity for long-term economic growth," says House Minority Leader Richard Gephardt).

If the government's books were not purposely cooked in the same way as corporate accounts, there still remains the question of how the government could be so wrong. The Bureau of Economic Analysis may well be free of partisan tilt, but its incompetence can cast a long political shadow.

Clinton Economic "Boom" is Actually Economic BUST

December 19, 2000

You've heard the stories for years now. How in eight years of President Ronald Reagan, the national debt tripled, the poor got poorer, and the rich got richer. How Bill Clinton inherited "The worst economy is 40 years" from President George H. W. Bush. All lies, but sucked up by press/media, liberal economists and daytime brain dead shows like Regis & What's-her-name, Good Morning America, and Oprah Winfools..

In actual fact, the Reagan years produced the strongest economic growth since the roaring 20's, saw more people jump UP income brackets than at ANY time in our history, and created more jobs than in ANY 8 year cycle EVER. Yes, the federal debt did triple, but actually dropped as a percentage of GDP, and don't forget, Reagan WAS handed one of the worst economies in our history, with 20% interest rates, gas lines, and rabid inflation. Yet in just 8 years he reversed it all, WHILE defeating the threat of Communist obliteration of our country, and having to deal with a Democratic Congress that just couldn't stop spending. Now that's MR. REAGAN'S legacy Mr. Clinton, unfortunately, yours will be more along the lines of scandal, sex, lies, drugs, draft-dodging, Monica and of course, ...IMPEACHMENT.

Here's what you NEVER hear from the liberal media: The first 2 years of Clinton/Gore DOUBLED the federal debt, even though they were handed a growing economy, a peacetime dividend, and an information revolution that would dramatically increase productivity.

As you now know, it's not a "Clinton Boom" we're enjoying, but a continuation of President Ronald Reagan's boom. Even George H.W. Bush endorsed what he had previously called "Voodoo Economics" after Reagan proved to us that it worked. Reagan's historic economy actually continues to grow with us to this day, only briefly interrupted by two large tax increases. (Econ 101 for liberals: "Economic boom, interrupted by tax increases.") As shown in the famous graph occasionally published in The Wall Street Journal, a mild recession brought on when President Bush was forced by the Democrats in Congress to break his "No new taxes" pledge more than recovered in the fourth year of his term. In fact, Clinton would never match the economic growth President Bush left him until the Republicans took over the Congress and started reversing his liberal tax-and-spend policies. That bears repeating: Clinton would NEVER match the economic growth President Bush left him until the Republicans took over the Congress and started reversing his liberal tax-and-spend policies. The incredible market run up and period of economic growth was slowed under the first two years of the Clinton administration, due to the largest tax increase in history, and the first one that was ever retro-active. (Clinton actually had the audacity to tax people for a period of time when he WASN'T EVEN PRESIDENT!) Other poor fiscal policies inspired by the liberals within the Clinton team contributed to the Clinton downturn.

Here's the graph:

As Mr. Peabody would say, "Sherman, set the way-back machine to 1992." Clinton has just been inaugurated, and has appointed his liberal friends to the treasury and economic advisory board. In order to pay for their huge increases in government spending programs, and keep the largest tax increase in history from being even larger, Clinton goons must "Cook" the books and make some hair-brained accounting moves to make the national debt APPEAR smaller.

How you ask? Let us count the ways.

By swapping long term treasury notes at higher interest rates for short term notes at lower government paid interest rates.

Now, this works as long as the economy stay up and interest rates stay low. But if the short term notes come due after interest rates go up, then the government has to sell new notes (borrow) at the higher interest rates. Remember Ross Perot bagging on Clinton for short-term financing our national debt? The liberal media just ignored him.

Think of it this way. You are financing a house and the interest rates are lower than they have ever been. Do you go for the long term note or the five year variable? Of course you lock in the long term rate!

Unless you're Slick Willie, and know that you won't be in office in eight years, so who cares? And in fact, it would make Slick look even better if the economy did well while HE was in office, and poorly after HE left. Too much to ask? Not if you go for the lower short term rates to reduce your deficit and forego the long term security and increased financial market stability you could have had with the only slightly higher long term note rates. Almost like buying a house on your credit card. Guess what? That's EXACTLY what the scumbags did! Who care's about the country's future, it's all about me, me, me. Make the economy look good while I'm in, and ah, er, screw the next guy. What Bill Clinton would call a "Twofer."

How else did the Clintonistas "Reduce" the debt to increase spending on fabulous programs like Hillary's failed healthcare plan, Al Gore's favorite: Environmental impact study on cow farts, or "Midnight basketball??" (Simply an excuse for young thugs to be on the streets in the middle of the night, instead of home, getting a good night's rest so they can go to school, or WORK.)

How about looting the Social Security trust fund of the extra cash put in there to cover the retirement of the baby-boomers which starts in another 12 years? (Once again, AFTER Bill is long gone!) Yep, they did that too, and get this, they THEN had the audacity to claim that Republicans would destroy Social Security and put granny on the street if they were elected. Shame? No way, we're talking about the guy that dorked Monica.

Gutting our Armed Forces: Clinton brags about Al Gore "re-inventing" government, (Didn't Al invent it the first time?) and in the process, cutting 100,000 government jobs. What he fails to follow up with, is that number includes over 700,000 active duty Armed Forces personnel, and almost 300,000 Reserves who are no longer defending our country! In other words, he's INCREASED the size of "government" by 900,000 basically worthless workers, (the government was already screwed up) and cut our military. Sounds just like something Gore would do! More government spending, simply transferred from our military budget. And while we're on the subject of looting military spending, don't forget all those foreign trips, you know, like the ones Bill, Hill, Chelsea, Hillary's mom, (a real national security expert, chuckle, chuckle!) and ALL their friends went on to Africa, India, etc., etc.? Yep, you guessed it, literally hundreds of millions of dollars, ALL budgeted to "Military expenses." All while our troops live on food stamps, another Clinton first.

"Cooked books?" They hadn't even thawed them yet. Under Reagan and Bush, unemployment was measured by sending out about 60,000 "Household surveys" asking about employment. The "Chronically unemployed" were dropped from counting, defined THEN as three or four years of being out of a job. The Clinton regime dropped 9,000 surveys, mostly in inner cities where unemployment is much higher, then later trimmed the overall number to 50,000 - again avoiding inner cities. They then redefined the "Chronically unemployed" horizon down to ONE YEAR. BINGO! Instant record breaking unemployment and the lowest recorded unemployment for African-Americans in history. Wow, are we doing well or what!

What has to be remembered is that the reading of the economic speedometer (CPI, PPI, unemployment, etc) is done by the Clinton administration Department of Labor. Surely, no one is suggesting that Labor Secretary Alexis Hermann lied to make Slick Willie look good. (Ahem! Cough, cough! We're talking about someone who has a special prosecutor slowly proving she took bribes and lied about them!)

Fortunately for America, the GOP took the House and Senate in 1994, AFTER which, the market began its extraordinary rise. Again, that bears repeating. Bill Clinton had actually SLOWED the economy until....the GOP took the House and Senate in 1994, AFTER which, the market began its extraordinary rise.

Remember when Bill claimed "He was still relevant" after the Republicans took Congress? In actual fact, he has been totally irrelevant to our current economic boom. The only relevance he's had on the economy is when he briefly stunted a booming period of growth with his huge tax increase, massive federal spending, and terrible fiscal policies. Hey, at least he was getting laid.

"Amazingly" (dripping sarcasm now turned off) GOP-backed legislation such as the balanced-budget, reduction of deficit spending, welfare reform, etc., quickly reversed the Clinton mini-recession. (And probably got him re-elected, and certainly saved his @$$ from being the first President impeached and REMOVED from office.) While Greenspan contributed interest-rate moderation, Clinton simply went along for the ride, although, not willingly. He vetoed every one of the bills until public pressure forced him to sign them later. He basically went kicking and screaming, and you certainly remember his dire predictions when he signed them: "Poor people, the elderly, and (of course) women and children will be left cold, homeless and hungry." Now that none of that has actually happened, Slick claims these GOP successes as HIS administrations greatest accomplishments. Nerve? Hey, we're talking about Bill Clinton.

Now, flash forward to today. The liberal media is talking about the upcoming recession, as if, since a Republican was elected President, the bad times are back again. What their short-term-memory-loss-minds forget is that when Billy was handed the keys to the White House in 1993, the proclaimed Bush "Recession" of 1992 was suddenly termed an "Economic boom."

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