Economy is Up, Up, Up -- Where's Kerry Now?

[FUZO]

TweetEconomy is Up, Up, Up -- Where's Kerry Now?





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Until Election Day, President Bush's political foes were condemning what they called a jobless, slow-growing economy that John Kerry kept comparing to the Great Depression.

Despite Kerry's hyperbole, the U.S. economy was in a full recovery. The month before voters went to the polls, businesses reported that they had added 303,000 new jobs to their payrolls, though the government's October jobs report came a few days after the election.

Since then, just about all the salient economic numbers have been up, and the Massachusetts liberal has all but disappeared from the major political arena, his dismal economic rhetoric, in retrospect, looking pretty foolish. Unemployment continues to fall, economic growth is up, the Dow has staged an overall comeback (despite the usual week-to-week fluctuations), consumer confidence has risen and Bush's job approval score is up at 53 percent, according to the Gallup Poll.

It turns out that Bush's tax cuts, roundly condemned by the Democrats, were just the right medicine after all.

Unfortunately, while the war against Bush's economic policies ended on the campaign front, at least temporarily, national news media bashing of the economy continues. It can be seen in the news pages and much of the daily reporting from Wall Street, despite the post-election rally in the financial markets and economic growth numbers that any of our trading partners would be proud to have.

Adjectives like "mediocre," "lackluster," "weak" or "sluggish" are still being used in business reporting to describe an economy that is growing at about 4 percent, according to the U.S. Commerce Department's third-quarter revision of the Gross Domestic Product.

Since when is 4 percent GDP growth mediocre? The European Union is barely achieving 1 to 2 percent. The Japanese would be dancing in the streets if their economy was performing at our level.

Here at home, retail sales have been rising, the technology sector is in a comeback, with Intel forecasting higher revenues, industrial activity is up, oil prices (as I'm writing this column) have fallen precipitously since the Energy Department reported that inventories were much higher than expected, and government officials tell me that higher incoming tax revenues are reducing the federal budget deficit.

True, earlier this month the Bureau of Labor Statistics (BLS) reported that the economy created 112,000 new payroll jobs in November -- a number that disappointed Wall Street, which expected 200,000.

The major newspapers and nightly media shows, of course, turned this one-month number into bad news, worrying that it could mean a downturn in the economy. The usual suspects were brought before the cameras to say that the jobs number had to reach at least 150,000 jobs a month to keep up with the growth of the labor force.

Not reported, though, was the 303,000 payroll jobs created in October, following 119,000 jobs in September. Simple math shows that the economy has created 534,000 jobs in just the past three months, thus yielding a monthly average of well over 150,000 jobs.

Add to this the BLS' benchmark revision of the payroll survey that was released in October -- showing that many more jobs have been created over the previous year than the initial monthly surveys suggested -- and a stronger payroll employment picture emerges: 2.4 million new jobs have been created since August 2003.

In just the past year alone, more than 2 million new payroll jobs have been added to the labor force. Hardly a number that should produce the post-election hand-wringing we're still seeing.

But you don't get this perspective on the nightly network news shows, which is a pretty good reason not to watch them or, if you must, not to believe them. All too often the economic reporting is cooked with selective facts reported out of context.

The bottom line is that we have had 15 straight months of payroll job growth and the unemployment rate has fallen to 5.4 percent. Compare that to the nearly 10 percent jobless rate in Europe.

Meanwhile, the president is slowly putting his economic team together, choosing to keep Treasury Secretary John Snow, for the time being at least, after the White House sent signals that the former railroad executive would be leaving.

Snow has been a loyal soldier who was on the road virtually nonstop during the campaign selling the president's economic policies, but White House strategists wanted a stronger pitchman to make the administration's case on Social Security reform and overhauling the tax code.

In the end, the president's men decided that both initiatives were going to rise and fall on Bush's personal salesmanship, and the amount of political capital he is willing to spend to get them enacted.

But a strong, growing economy is always the best political capital any president can have when making his case for fundamental fiscal reform, and that's what Bush has going for him as he heads into his second term.

[T-Man007]

Tweet4 more years! Either way this is good for me. I'm in the Real Estate business. When rates are low people refinance more. When the economy is good people buy more. Either way it gives me the opportunity to do more appraisals.

[mick-G]

TweetI don't know about the statistics. I have seen more businesses file chapter 11 and in the back in the last yr. Also, i think that when ppl that are layed off and then stop collecting unemployment, they use that in their statistics as ppl that are back to work, when in fact they are prob accepting much lowing paying jobs. Alot of these so called new jobs are also jobs that are much less in salary then the ones that were replaced. There are also alot of jobs being taken out of the country, as many small businesses and corporations are forced to hire those who will do the same work for much lower wages and whos workmanship is of better quality. I don't think that other than the war in Iraq that it has been the fault of an administration, but in changes in the economic cycles. I believe that the economy fluctuates every 5-7yrs in either an upward or downward trend. We are still, i beleive in the down tread since the last 3 yrs. Hopefully the next few yrs we'll be seeing a noticable improvement.