NEW YORK--American officialdom says the economy is humming. But ordinary citizens think it sucks. Who's right?
Current Republican Party talking points focus on three mantras. First, there are lots of new jobs. Second, unemployment is low. Third, more people own homes than ever before. And it's all thanks to George W. Bush's cuts in the income and estate taxes, which stimulated the economy by freeing up additional capital for investment in jobs and new ventures. Things couldn't be better, they claim, but the liberal media refuses to give Bush the credit that he's due.
The trouble for Republicans is that the American people believe they're still in a recession. A new poll by the American Research Group finds that a whopping 58 percent of voters disapprove of Bush's handling of the economy while only 36 percent approve. (The figures are virtually identical to those for his overall job approval rating, which lists 57 percent disapproval and 37 percent approval.)
Reflecting a polarized nation in which Democrats and Republicans work, live and worship side by side while apparently living in separate realities, most liberals disapprove and most conservatives approve of Bush's economic stewardship. But the GOP has good cause for concern as this fall's midterm elections draw closer: the self-identified Independents who have determined the outcome of recent races disapprove, 66 to 28. Even more worrisome, most voters--by a margin of 47 to 36--think the economy is getting worse. Americans haven't been as pessimistic about the American Dream in years.
As one who was a science major in a previous life, I have always taken issue with Disraeli's (or possibly Twain's) aphorism about lies, damned lies and statistics: numbers are not meaningless. To the contrary, factoids can make sense of the world when presented logically and in good faith. Unfortunately, both those conditions are obviously lacking in men whose defense to the charge that they leaked classified information in order to get even with a critic is that they secretly declassified it first. The result is an increasing number of attacks on statistical decency.
Bush summarized his party's economic arguments in his weekly radio address on April 1. Each of Bush's tropes, lawyered as consciously as was his classic phrase "weapons of mass destruction-related program activities," collapses upon cursory inspection.
"The truth," said Bush, "is that since August 2003, America has added almost 5 million new jobs."
Sounds great, but it depends on what your definition of "added" is. According to the Economic Policy Institute, the U.S. economy must generate 150,000 jobs every month in order for the unemployment rate to stay the same. Because the total number of workers rises with population growth, a president who creates fewer than 1.8 million new jobs each year presides over rising unemployment.
Just to stay even, then, Bush would have had to create 4.65 million jobs between August 2003 and the present. By his own admission, he only has 350,000 net new jobs to show for a workforce of 143.6 million people--a net increase of less than one quarter of 1 percent. No wonder Bush isn't feeling much love.
Moreover, some 1.9 million jobs--net jobs--vanished before August 2003, during the first two and a half years of Bush's first term. That wasn't all his fault. He came into power at the start of the dot-com bust. Nevertheless, Bush's tax cuts didn't help. Those lost jobs never came back. The people who lost them are still unemployed, underemployed or have been statistically transformed into "unpersons," the "discouraged job seekers" no one bothers to count.
Another statistic sliced so thinly as to be meaningless is Bush's description of joblessness. "Our unemployment rate is now 4.8 percent--lower than the average of the 1970s, 1980s, and 1990s," Bush said on April 1.
Setting aside the fact that during the 1980s the Reagan Administration ordered the Bureau of Labor Statistics to stop counting "discouraged workers"--those who had stopped looking for work--as unemployed, this is a classic case of comparing apples (the current unemployment rate) with oranges (the broad average of the unemployment rate over decades). Applying Bush's logic, one could pluck the unemployment rate from any point from 1970 to 1999. So what if Bush's current 4.8 percent beats such historical peaks as Ford's 9.0 (May 1975) and Reagan's 10.8 (December 1982) and Bush 41's 7.8? (Notice a trend?) While he's dredging up old jobless rates, why not compare himself to Depression-era Herbert Hoover? As far as politics go, the most relevant historical comparison to Bush's performance would be that of his immediate predecessor. Unfortunately, Bill Clinton's 4 percent (December 1999) doesn't do him much good here.
Can the economy boom without benefiting individuals? Economists often ask themselves that question, but that's not what most Americans believe is going on. When they look beyond their personal financial situations, they see a dismal macroeconomic reality reflected in 401(k)s that have yet to recover from their post-dot-com losses. The Bush Administration has added $2.7 trillion to our national debt. Not only do its expensive wars in Afghanistan and Iraq have no end in sight, now they're talking about nuking Iran. The U.S., they know, is broke and getting broker.
Writing in The Washington Times, pundit Robert Charles tells his fellow Republicans that they can regain their footing in the polls. All they have to do, he advises, is to "highlight the extraordinary performance of the U.S. economy." Nothing would do more to convince the public that the GOP doesn't have a clue.
Ted Rall is the editor of Attitude 3: The New Subversive Online Cartoonists, an anthology of Web cartoons which will be published in May.