Unfair Bush Policies Cause Weak Bush Economy
By Mike Hersh, Oct 31, 2004
The economy is already weak and getting weaker, thanks to Bush's bad priorities and irresponsibility. The Washington Post reports, "The Conference Board said that its Index of Leading Economic Indicators fell 0.1 percent last month, following declines of 0.3 percent in August and 0.3 percent in July. The group said that while the weakness over the last several months in the economy has become more widespread, the declines in the leading indicator index are not yet large enough nor have they lasted long enough to suggest that the current economic expansion is ending [but] Conference Board economist Ken Goldstein called the September decline a 'clear signal that the economy is losing momentum heading into 2005.'" (See: "Leading Indicators Decline in September," Washington Post, October 21, 2004; http://www.washingtonpost.com/wp-dyn/articles/A51286-2004Oct21.html).
Confirming the bad news, Reuters reports "the University of Michigan's consumer confidence index slipped for a third straight month in October, to 91.7 from 94.2 in September as rising oil costs weighed. The dollar slipped in value against other major currencies. Bond prices ended higher, but primarily on fears about higher oil prices.... Some analysts noted that America's swelling trade deficit seemed to be putting a damper on the rate of expansion but not putting a lid on it entirely. 'It's a pretty good growth rate, but it may not be enough to create jobs,' said economist Robert Brusca of Fact and Opinion Economics in New York." The Bush Commerce Department sited " consumer spending" and "the lowest inflation in decades" as reasons for the growth. (See: "US Growth Under Forecast in 3rd Quarter," Oct 29, 2004: http://olympics.reuters.com/newsArticle.jhtml?type=businessNews&storyID=6660709)
High consumer spending and low prices cannot continue as consumer confidence continues to fall, people lose their jobs, and costs shoot upward. The AP reports the economy keeps weakening: "The number of Americans filing new claims for unemployment benefits rose last week by 20,000, the largest jump in a month, the Labor Department reported Thursday. The bigger-than-expected increase pushed total new claims to 350,000 last week."
As job losses continue, "Worries about job prospects drove consumer confidence lower in October for the third consecutive month, a New York-based private research group said Tuesday. The decline was steeper than expected and raised questions about how consumers will spend during the critical holiday shopping season. The Consumer Confidence Index dropped 3.9 points to 92.8, down from a revised 96.7 in September, according to The Conference Board. Analysts had expected a reading of 94." (See: "Weekly Unemployment Claims Jump by 20,000," Associated Press October 28, 2004 http://www.washingtonpost.com/wp-dyn/articles/A4677-2004Oct28.html and "Consumer Confidence Falls Again in October," Associated Press: October 26, 2004, http://www.washingtonpost.com/wp-dyn/articles/A63773-2004Oct26.html).
Bush's policies favor those who need no help, while making life far more difficult for the vast majority of Americans. As the pro-Republican Bloomberg News reports: "If most of your income is derived from dividends and capital gains, you did very well [under Bush] because the top rate on those items was pared by more than half to 15 percent. [These] 'tax cuts stimulated the economy a little bit,' says Joseph Stiglitz, a Nobel Prize winner in economics, [but] you would have had a much bigger impact if you spread the cuts around. The dividend tax cut was the most egregious and provided no [job-producing] stimulus.'"
Most Americans are falling behind, according to these reports, because "inflation as measured by the U.S. Consumer Price Index - now at a 3.5 percent annual rate versus a 2.6 percent increase last year - outpaced personal-income growth for more than two years [especially] rising utilities, maintenance and repair costs. Residential natural-gas prices alone climbed 16 percent [and] health-care premiums rose 60 percent for family coverage between 2003 and 2004, [while the] Census Bureau estimates 5.2 million lost health coverage since 2000."
Bloomberg reports, "the top 1 percent of wage earners - those making more than $1 million annually - reaped the greatest benefits from the tax-cut laws promoted by the Bush administration." But Bush's 2001 and 2003 tax breaks left nearly all middle-income families worse off. They "experienced a drop in after-tax income: a decline of 0.2 percent for two-parent families and of 1.4 percent for young singles and elderly couples,' reports the Economic Policy Institute [while] bankruptcies hit a record 1.1 million - up 37 percent from 2000 - with 'some households stretched to their limits,' according to U.S. Federal Reserve Chairman Alan Greenspan, speaking Oct. 19."
Under Bush's "tax legislation, less federal revenue - about $4 trillion over the coming decade - is being shared with states for programs like Medicaid, education and state homeland security. Congress owes the states a minimum of $50 billion for fiscal 2004 and 2005 for federally mandated programs that were not fully funded by Washington, according to the National Council of State Legislatures. That means state and local taxing bodies were forced to pare services and increase taxes to balance their budgets." (See: "Are your finances better off now than in 2000?" Bloomberg News October 31, 2004, http://seattletimes.nwsource.com/html/businesstechnology/2002077528_wasik31.html)
The AP reported, "Bush took office after a four-year string of federal surpluses, and the 2004 surplus of $387 billion that he forecast upon taking office became an actual deficit of $413 billion - an $800 billion reversal. 'President Bush has never been straightforward that the deterioration in our deficit is not short term, but a dramatic long-term deterioration,' said Gene Sperling, an economic adviser to Democratic presidential candidate Sen. John Kerry of Massachusetts. 'The American people deserve ... a president who doesn't try to mislead them about the true fiscal condition of the country, and they deserve a president who will put this country back on a course of fiscal responsibility,' said Sen. Kent Conrad, a North Dakota Democrat, a senior member of the Senate Budget Committee. The Treasury released the [$413 billion] deficit figure the same day it announced the government has begun using accounting procedures to avoid hitting the $7.4 trillion statutory national debt limit." (See: "Record $413 billion federal deficit in 2004 as Democrats blame Bush," The Associated Press October 15, 2004: http://www.abqtrib.com/archives/news04/101504_news_debt.shtml)
CBS.MarketWatch reports the economy - especially jobs - has languished. "Since Bush took office in 2001, U.S. GDP has grown from $9.9 trillion to $10.9 trillion (in 2000 dollars), an average of 2.3 percent per year. Over the same time, nonfarm payrolls have fallen about 821,000 jobs to 131.6 million" and "the administration's job forecast of 138.3 million jobs in 2004 didn't pan out. Actual hiring has fallen 7 million short of the White House forecast." This is the worst job performance by any president since Herbert Hoover in the 1930s! "The stock market is down during Bush's term, with the Dow Jones Industrial Average off by more than 500 points, or 1.5 percent per year."
Other key data from CBS.MarketWatch: "[T]he number of Americans living in poverty has grown by 4.3 percent per year to 35.9 million in 2003," gas prices have jumped. Regular gasoline now costs an average of $2.03 a gallon, compared with $1.47 when Bush took the oath of office, an average increase of 9 percent per year" and "twin deficits have grown under Bush. The federal budget deficit has turned from a surplus of $127.1 billion in fiscal 2001 to a projected deficit of $348 billion in fiscal 2005. The deficit averaged 2.9 percent of GDP during Bush's four years. Meanwhile, the current account deficit has grown from 4.3 percent of GDP to 5.7 percent."
(See: "Economy remains potential wild card," CBS.MarketWatch.com, Oct. 29, 2004: http://cbs.marketwatch.com/news/story.asp?guid=%7B6AD5C0AD-4459-45C2-A774-E5E0A394615D%7D&siteid=google&dist=google and "Plenty of growth, but few jobs," CBS.MarketWatch.com, Oct. 29, 2004: http://cbs.marketwatch.com/news/story.asp?dist=¶m=archive&siteid=google&guid=%7B78543745%2DC1F9%2D4EC7%2DBCC9%2D91A4C275E8D0%7D&garden=&minisite=)
As Bush's bad economic policies drive America further into debt and more businesses into bankruptcy, private pensions disappear. As the Washington Post reports, "[L]ast month, in a Chicago bankruptcy court, United Airlines warn[ed] that it will likely dump its pension plan onto the federal government. Under the rules of the federal Pension Benefit Guaranty Corp. (PBGC), [that would leave a retiree with] a third of his expected benefit. 'Instead of being able to retire, see our kids, we're probably going to have to work until we die,'" said one victim of this meltdown, more threatening as Bush announces plans to tamper with Social Security.
Sadly this is "part of a phenomenon that is reshaping the financial landscape for America's retirees. As the baby boom generation retires and people live longer, both Social Security and privately funded pensions - the two basic legs of American retirement income - are under increasing financial pressure." Pressure because of Bush economic policies and failures. (See: "Pension Promise No Guarantee of Security - Bankruptcies Can Mean Sharply Reduced Payouts," Washington Post, October 12, 2004; Page A06, http://www.washingtonpost.com/wp-dyn/articles/A25334-2004Oct11.html).
Now Bush seeks to loot the Social Security Trust Fund to further enrich his already wealthy pals. Bush can only get the money to pay for his planned transition to private or partially private Social Security from taxpayers and the Trust Fund itself. Since Bush promised not to raise income taxes, he must hike payroll taxes, slash benefits, raise the retirement age, raid the Trust Fund - or all of the above.
Bush likes to say, "That's not the government's money, that's your money." So why is he going to take your money, money you worked for, planned on and need for a decent retirement? Why does he continually put the top 1% richest people he calls "his base" above the national good? Why would anyone other than those elite vote for Bush? They shouldn't.
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