Watch: #2 When Life Handed Bush a Bowl of Cherries, He Made
Jerald Cumbus (JCMach1)
It is no mistake my column this week begins with a mixed
metaphor: a mixed message of clichés. It
was almost exactly one year ago that the mixed messages began.
Clinton administration officials argued the relative health
of the economy despite the dot.com debacle. It was at
this time the recession emerged fully developed from the creative
engineers of Bush, Inc. as a way to sell their huge tax giveaway
to the American people. On Thursday, December
21, 2000 the Bush Recession began with the Dick Cheney statement
that the United States was at "front edge of a recession."
Combined with the month and a half of the election challenge
'the real' economy began its downturn.
Because of the excellent health (with the possible exception
of factory orders) this alone would probably have not been
enough to tip the scales to negative. However, events
quickly overtook the Bush administration that continued the
erosion of the nation's economic health. Bush's go it
alone 'Cowboy' foreign policy left many foreign investors
cold. The China crisis and our arguments with Russia
over the ABM Treaty served to reinforce this view. Add
in the California energy crisis and Bush's 'do nothing' policy
and you have a recipe for disaster.
Additionally, the effect of Bush pushing his tax cuts cannot
be overstated. Part of the success of the markets over
the Clinton years had been the result of taking control of
runaway Republican spending and the accumulation of record
budget surpluses. Economists and the market clearly
recognized that the Bush tax cuts would lead to new deficits.
All of these factors served to first destroy confidence in
a relatively healthy economy and later directly led to the
unemployment dive that began in March 2001 which marked the
beginning of the Recession proper.
The economic blow dealt by September 11th was like kicking
an old lady after she had already fallen down. It hastened
the decline, but did not cause the Recession. In fact
there was some evidence this week that the economic affect
of the attack on America may be less than previously thought.
For example, there was a record
jump in consumer spending in October. While unemployment
claims dropped by "18,000" last week. I firmly believe
that most of this decrease can be accounted for by people
returning to work after employers miscalculated the affect
of 9/11 on their businesses. The unreported news
in the Unemployment
Insurance Weekly Claims Report was that "The advance number
of actual initial claims under state programs, unadjusted,
totaled 599,975 in the week ending Dec.1, an increase of
160,533 from the previous week. There were 477,503 initial
claims in the comparable week in 2000." The media completed
ignored these important figures.
When you combine an
unemployment rise of of 5.7% (the highest in 6 years)
retail sales this holiday season, on its one year anniversary,
the Bush recession is going strong. And, because it
was directly caused by his administration's policies Bush
is more responsible for the economy than almost any other
President in recent memory. Welcome to the Bush recession.
Depression Watch is a continuing series that will explore
the numbers, politics, and realities of the US Economy.
Why a Depression Watch? We are in a Recession -- there
is only one thing worse than that. We here at Depression
Watch will keep you informed on this important issue that
affects your pocketbook.