If there were a Pulitzer Prize for wishful thinking, I have no doubt the New York Times would win hands down.
Here we are 3 days before the election and, right on cue, the Times pulls a journalistic stunt that, if we didn’t know how partisan and biased they truly are, would be remarkable for its blatant attempt to plant a horrifically negative spin on one of the Republican’s only major pluses going into Tuesday’s vote; the relative economic health of the country.
First, the set up. In a front page story, the Times reveals that many Republicans are running on the economic record for the last 6 years and are buoyed by the Labor Department’s report of a significant drop in the unemployment rate:
Republicans seized on a drop in the unemployment rate to assert on Friday that tax cuts were invigorating the economy, highlighting just four days before the election an issue that party strategists are counting on to offset bad news about the war.The Labor Department announced Friday morning that the unemployment rate had fallen to 4.4 percent in October — down from 4.6 percent in September and the lowest rate since May 2001, when it was 4.3 percent.
Within hours, President Bush mocked Democrats for predicting that the administration’s tax and spending policies would wreck the economy.
In fact, by most indices, the Bush economy is at least as good as the Clinton economy from 1998 during that off year election. Unemployment, income, GDP growth, and other broad markers are as good or better than when the Times and other media were talking about the Clinton “miracle” economy. That’s not to say that there aren’t enormous problems, largely created by Republicans, that we must address down the road. But the current state of the economy is, in fact, fairly good.
But never let it be said that the New York Times let any positive news for Republicans be allowed to speak for itself. In an almost comical juxtaposition, the Times’ editors run an editorial that cuts the legs out from underneath any salutary news about unemployment by telling us that layoffs are coming – you just wait:
The latest information about the economy leaves no question that it has slowed down by just about every measure — housing and manufacturing, retail sales and job growth, and others.Even the recent increase in compensation is generally believed to be a sign of coming layoffs, not a harbinger of wage inflation. When business dries up at firms and factories, employers don’t cut back immediately. So for a time, pay and benefits hang in there. As for the recent improvement in the unemployment rate, sorry to say, it’s an aberration. The job market won’t turn up in any meaningful way when the overall direction of the economy is down.
In fact, the “overall direction of the economy” is still going up although at a slower rate than the frenetic pace of the previous 2 1/2 years when the Times never missed a chance to, well, miss a chance to prominently report the fantastic rates of GDP growth (never in the news section; always in the business section).
To the editors, it’s not a question of if but when the slowdown will occur and whether it will be a recession or not:
All of this information has fed the debate on the dominant economic question of the day: Is the United States economy headed toward the longed-for soft landing, in which it cools without contracting. Or is another recession inevitable? It’s an interesting question, but in many ways it also is a diversion.Most Americans are ill prepared for an economic deceleration, even if it ends in a soft landing. When economic basics like income and insurance coverage are taken into account, most working families are no better off now than they were when the economic expansion began in late 2001.
Some Americans are always unprepared for bad times. Those that live on borrowed money end up paying for it when the economy goes south. The fact that people borrow against the future should not surprise us. The government has been doing it for more than 6 years and when that bill comes due, true economic pain will be involved.
The Republicans and Bush have done more damage to the long term economic prospects of the United States than any two Administrations before them. The debt burden, extending out as far as they eye can see, is almost unbelievable. This AP piece on our economic future is one of the more frightening things I’ve read in quite awhile.
Their basic message is this: If the United States government conducts business as usual over the next few decades, a national debt that is already $8.5 trillion could reach $46 trillion or more, adjusted for inflation. That’s almost as much as the total net worth of every person in America – Bill Gates, Warren Buffett and those Google guys included.A hole that big could paralyze the U.S. economy; according to some projections, just the interest payments on a debt that big would be as much as all the taxes the government collects today.
And every year that nothing is done about it, Walker says, the problem grows by $2 trillion to $3 trillion.
People who remember Ross Perot’s rants in the 1992 presidential election may think of the federal debt as a problem of the past. But it never really went away after Perot made it an issue, it only took a breather. The federal government actually produced a surplus for a few years during the 1990s, thanks to a booming economy and fiscal restraint imposed by laws that were passed early in the decade. And though the federal debt has grown in dollar terms since 2001, it hasn’t grown dramatically relative to the size of the economy.
But that’s about to change, thanks to the country’s three big entitlement programs – Social Security, Medicaid and especially Medicare. Medicaid and Medicare have grown progressively more expensive as the cost of health care has dramatically outpaced inflation over the past 30 years, a trend that is expected to continue for at least another decade or two.
My beef with the Times isn’t that the Republicans haven’t been lousy stewards of the economy per se. It’s the rank partisanship they exhibit with a regularity that makes them poster boys for Metamucil. For such an established and respected name in journalism, they have demonstrated that they are little better than shills for the Democratic party – and bad ones at that. At least a shill will make an effort to hide their partisanship. The Times doesn’t even bother anymore.
As for the future, taxes will have to be raised. Spending will have to be cut. And somewhere, somehow, we have to find the money to keep fighting an enemy that wishes to destroy us. Will we be forced by economic circumstance to curtail our efforts in the War on Terror? I don’t think so. But we are almost certainly going to be forced to fight smarter. A smaller armed forces with more emphasis on “asymmetrical warfare” and an even greater reliance on our technological advantages will probably be in the offing.
These problems are not going to solve themselves. It will involve real statesmanship at the top and a cooperation in Congress between the two parties that would almost be unprecedented. And we, the American people, must somehow wean ourselves from dependence on government for some things that today we might find convenient or even helpful.
A tall order all of that. And the hell of it is, there doesn’t seem to be the leadership in Congress now in either party that is good for anything except jostling for power and position.
3:44 pm
Rick
As always, good post. You nailed it!! You write: “But we are almost certainly going to be forced to fight smarter.” I agree whole heartedly. Right now the militaries of Russia and China are every bit equal to the military of the US and, in some ways, they are militarily superior to the US. This is especially so with regards to Russia. These countries have achieved military parity with the US while spending only a fraction of the amount of money on their militaries that the US spends.
Btw, as a Conservative, my over riding theme is “government stay out!!” The Republicans have expanded the size and intrusiveness of the government at an astounding rate. Thuis is unacceptable. If there is a silver lining here, as the debt comes due down the road, government services will have to be cut. We will finally have a less intrusive government. At some point, Government services will have to be cut. This has to happen whether Democrats or Republicans are in office. The long term damage from this spending spree is to late to correct.
The Government agencies I would eliminate first would be the EPA and the Department of Education. The elimination of these useless organizations would save the taxpayers alot of money.
5:01 pm
In keeping with the theme of my previous post, here are some suggestions on how we can fight a smarter war. 1.) Assist Israel to become completely militarily self sufficient. Israel is by far and away our most valuable ally. A militarily self suffiecent Israel will be a strong buffer between the Western world and terrorists. 2.) Encourage South Korea, Japan, and Tawian to develop nuclear weapons and to substantially increase the capabilities of their militaries. Those three countries would be able to act as a check on Russia and China. Also, it gives the US the benefit of removing most, if not all, of it troops from Japan and South Korea. My understanding is most of the citizens of South Korea and Japan don’t want US troops in their countries any way. This suggestion gives us stronger allies and allows us to withdraw our troops from these areas. This is a win-win all the way around. In any event, set a date certain with these governments as to when American troops will be completely out of their countries. This would give them strong incentive to implement the above policy suggestions. The date certain for US withdrawl should NOT be made public. 3.) I think we have a large number of troops stationed in Europe, specifically in Germany. My understanding is the Western European countries do not have very large militaries. We should set a date certain with our allies where we have troops as to when our troops will be completely withdrawn. We should assist them in developing their military capabilies prior to our withdrawl. Again the date certain for our troop withdrawl should not be made public. A militarily strong Western Europe will help to serve as a check on Russia. 4.) We need to secure our borders. 5.) The mosques need to be closely monitored and a moratorium should be placed on immigration from Muslim countries. In this note racial profiling is a good idea. We know who is most likely to be a terrorist. 6.) We should develop more of our own oil and gas resources. As we lessen our oil and gas imports, this will give us more leverage in any negotiations with middle eastern countries and Venezuela. Right now we have very little leverage. 6.) Somehow we are going to need to improve our human intellegence. 7.) We are going to need a frank assessment of who we are, who our enemies are, which enemies are the most dangerous, and where we are in the GWOT. By far and away our most dangerous enemy is Russia. As to where we are in the GWOT, to date the biggest winners have been Russia, Iran, and China, probably in that order. In other words, our three most dangerous enemies have been the chief benefactors of our current policies. The biggest loser in the GWOT has been Israel In other words, our most valuable ally has suffered the most. 8.) Finally, we need to recognize that the Islamic extremist/Communist alliance that is arrayed against us poses an existential threat to the USA and it should be treated as such.
There is still time to turn this around and win the GWOT. The first step to winning will be a frank assessment of our current situation. Once we have honestly assessed the situation, we will be in a better postion to develop successful policies.
7:43 pm
Rick,
We will be running budget surpluses within the next two years. I know that sounds odd – but the trend lines are there. The National economy has grown by over 33% since 2000 (pre-war and at the height of Clinton’s economic miracle). If the tax base grows by 10% and the spending grows by 5% than we are within 20 Billion of balance in FY2008. Our tax base growth has easily exceeded 10% since FY2004 (after the 2003 tax code changes), and our spending is around 7.5%. Wow, that is not 5%... But, that includes necessary DOD growth and Katrina relief. This year the DOD could not even spend all it was allocated so that growth will be slashed and Katrina is basically funded. Katrina itself accounted for 2% of the spending growth. So 5% spending growth will not even cause a serious yawl from the Libs. In fact, a good year puts us in balance this FY (4% spending growth and 14% income growth – achieved in FY2005
And, those trends are accelerating with the advent of the PorkBusters concept – a concept made possible by the internet and the blogosphere.
And, note that Medicare and Social Security expenses came in significantly less than expected this year. Are folks working a bit longer? More likely, are retiring folks actually paying taxes on investment income (401(k), IRA) that prior generations did not have? Are we actually a bit healthier that we were twenty years ago?
September 2006 Monthly Treasury Statement (ie. FY2006)
7:03 am
Since I’m campaigning myself for a local office I am on the street a lot and one thing glaringly obvious is all the “Help Wanted” signs. I must confess—I always have had a secret urge to be a truck driver and command a huge machine. Now would be the time, as all I would have to do is go to truck driver school for a few weeks and get the CDL and I would have my pick of jobs.
Despite hordes of immigrants in this area, the fast food places all desperately need more staff.
While doorbelling (my campaign theme centers on the miserable 75% high school on time graduation rate and the drop-out plague, I encountered a Hispanic lady who expressed a not-untypical complaint in her very limited English. Her son just dropped out of his Senior year in high school despite the fact that he speaks excellent English and was getting good grades.
The problem? He was offerred a full-time job at $22/hr and he jumped on it so that he can buy a new car with spinny wheels and a stereo system suitable for a small stadium.