October 30, 2003
FLOCCINAUCINIHILIPILIFICATION
The Bush Boomlet The economy just had a great quarter. Does that really mean it's booming? (Daniel Gross, Slate, 10/29/03)
When the Department of Commerce releases third-quarter gross domestic product figures Thursday morning, it will kick off one of the best days of the Bush presidency. As the Wall Street Journal reported, respected forecaster Macroeconomic Advisers believes the economy grew at an annual rate of 6.9 percent last quarter. . . .This article is splashed on the Slate homepage as Is The Economy Coming Back? Dan Gross on Bush's Bogus Boom.. The article, of course, doesn't say anything of the sort, concluding instead with "maybe, maybe not." There is no doubt, though, that Slate is hoping that there won't be any boom, and assumes that its readers are hoping the same thing.But thus far, the Bush boom rests more on hope than hard data—and on a pretty weak definition of a boom. . . .
The Bush boom promoters also sidestep the real issue about the third-quarter growth. It would be hard for the economy not to surge when you consider how much money the administration has poured into it in the form of tax cuts and government spending. It remains to be seen whether the economy can produce jobs and growth without continual booster shots, and whether the massive deficits the administration is running will drag down growth for years to come. . . .
The Bush boom may or may not be a reality. I'd settle for several quarters of consistent growth, with job creation and GDP expansion at rates remotely close to those of the '90s. But that doesn't make for a particularly sexy book title, or for a compelling re-election slogan.
This is the sort of "play-by-play" political reporting that drives me up the wall, because there is no point to it at all. Over the next 12 months, the economy will do whatever it does and the President's reelection will be easier or harder depending on its performance. But all the posturing now, by either side, is simply wasted.
Well, maybe not wasted. The Democratic voters who will soon be chosing their presidential nominee might well be effected by a belief that the economy is permanently crippled for '04. Such a belief would, I think, make Howard Dean seem just that much more electable and thus help his quest to be the Democratic Alf Landon. I would enjoy it immensely if all this doomsaying by the left lead the Democratic party to its richly deserved exile.
Posted by David Cohen at October 30, 2003 10:55 AMBREAKING NEWS:
ALL 9 DEMOCRATIC CANDIDATES FOR THE PRESIDENCY HAVE DROPPED OUT OF THE RACE UPON HEARING OF THE NEW GDP NUMBERS.
Edwards says - "Hey, there's some REAL money to be made now in the private sector! I'm outta here!"
Lieberman says: "Cheney had the right idea. I hope Haliburton is hiring!"
Kucinich says: "Why does God hate me? I mean - The Power of the Universe. Sorry about that God thing to all my fans."
Carol M. Brown says: "I'm glad the race is over. I was just wasting my time here, but at least I got on TV for a few months!"
John F. Kerry asks: "You think Congress will pass a bill so that we can get our expenses repaid? My wife won't give me my allowance if I'm not running."
Al Sharpton says: "Yo Mamma! Who's going to pay attention to me now? I hope that. . . "
(His words could not be made out after this, due to his chomping on a cheeseburger.)
Dick Gephardt asks: "Can I get my old job as Democrat Leader in Congress back, at least?"
Howard Dean says: "We can't afford a strong economy. That means we'll stay in Iraq and . . "
(All reporters left the room, so no one is sure what Dean had to say after his initial words.)
General Wesley Clark screams out: "ATTENTION!"
(No one paid attention to him again.)
Bill Clinton in disguise was photographed reading a Playboy magazine while waiting for the 2008 race for President. Hillary forgave him this indiscretion as she mulled her upcoming 2008 candidacy.
This reporter is mulling over a change in careers. Jason Blair has been offered my job by the NY SLIMES.
Posted by: Oswald Booth Czolgosz at October 30, 2003 1:49 PMReactions from pundits, bloggers and hangers-on:
Jonathan Chait: I hate Bush. I hate his economic numbers. I hate his tax cuts...but I'll keep my share. Hey, I ain't stupid.
Steve Sailer: Big deal. Bush stands no chance because he hasn't made the Republican party all-white.
Jonah Goldberg: Paul Krugman's so p.o.ed that he kicked his cat to the moon.
Paul Krugman: I'm so p.o.ed that I'm gonna kick Goldberg's, uh, donkey to the moon.
Orrin Judd: Fifty states! Fifty states!
Michelle Malkin: I'm bummed. This'll just bring more of those lousy immigrants.
Molly Ivins: Gimme another beer.
Casey Abell: Watch that misery index! I keep telling ya, watch that misery index!
Posted by: Casey Abell at October 30, 2003 2:30 PMMolly Ivins was on NPR this morning saying how she can't understand why people think she's a Bush hater. She likes Bush, he's affable and he's not stupid. He just done a lot of damage because all he cares about is big "bidness."
Posted by: David Cohen at October 30, 2003 2:35 PMDavid:
It's a safe bet that Molly will still have another beer or four. She sees a 2004 replay of Ann Richards perishing in flames.
And to all the people I may have offended with my parody, I apologize, including to myself.
Chuckle, snort.
Posted by: Casey Abell at October 30, 2003 2:41 PMOswald and Casey - funny stuff. If the economic news keeps improving there will be even more opportunity to pick on the Dems.
Posted by: AWW at October 30, 2003 3:29 PMI'll grant the Dan Grosses of the world that one quarter does not a booming economy make. But are we that nearsighted?
The jobless report today fell again, pulling the four-weak moving average down below 390K. The fact that inventories continue to fall, and productivity is rising, indicates that costs are low. As such, the production environment appears ripe for accelerated activity, which in turn would mean that businesses will need to re-hire workers.
On this news, revisions to fourth quarter GDP in the coming days/weeks are likely. Currently, GDP forecasts hover in the range of 3.5% to 4% for the fourth quarter. If 4% ends up being the actual number, then the economy will have grown at roughly a 4% pace for the year.
Now, move forward one more quarter (a painful mental exercise for some, I know). If the economy can at least sustain a 3.5% to 4% pace in 1Q04, the economy’s average growth rate will have jumped to between 4.5% and 5% on a four-quarter basis. Provided Mr. Greenspan doesn't stand on the brake pedal at that point, a highly unlikely scenario indeed, things should be humming.
The fact that inventories shrank again while consumption rose with real final sales growth of 7.8%, indicates production levels will have to jump at some point in the coming quarters. If the last three years has forced new efficiency levels as most suspect, the correlation between such increases and job growth should be virtually transparent.
John:
Indeed. Since Greenspan has indicated that he'll wait until Carter-style inflation to raise rates, and businesses have begun to spend on tech again, if you throw in a likely huge Christmas season for retailers, '04 looks like a lock for a boom year.
Posted by: Michael Herdegen at October 30, 2003 8:39 PMWhat will be funny is -- with the quarterly growth numbers coming out at 7.2 percent today -- if the next numbers come in at 4-5 percent growth, the Democrats will spin that as a sign that the economy is on a downslide towards the worst economic numbers since Hoover ... or the Panic of 1907, or the 1837 run on the Bank of the United States, or whichever sound byte goes over better with their focus group's poll responses.
Posted by: John at October 30, 2003 10:18 PMNo, the next Democratic wail line will be that tax revenues are not growing fast enough commensurate with the economy. And they will probably try to get Bob Taft and a few other Republicans to sing it out, too.
Posted by: jim hamlen at October 31, 2003 12:13 AMDaschle was on NPR this morning saying that Americans care about J-O-B's not GDP. Ted Kennedy was making the Bizarro world argument that the new overtime provisions were job killers. So prepare yourself for 12 months of jobs, jobs, jobs.
Posted by: David Cohen at October 31, 2003 7:53 AM