Economic Policy

Unfair Bush Policies Cause Weak Bush Economy
Economic Policy

Mike Hersh writes: "The economy is already weak and getting weaker, thanks to Bush's bad priorities and irresponsibility. Job losses are up, the Index of Leading Economic Indicators is down, consumer confidence is down, the deficit is up, gas prices are up, the costs of health care are up, poverty is up, family income is down, and things can only get worse as Bush stubbornly stays the course putting 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."

Bush Policies Endanger America's Ability To Create New Industries And Jobs
Economic Policy

The Progress Report: "America needs to improve its research and development climate, so it does not lose its edge in high-tech industries. The Bush administration's latest five-year budget would cut research and development budgets in 21 of 23 scientific agencies and its post-9/11 visa policies have had a negative affect on the flow of foreign scientists to the U.S (http://www.geosociety.org/aboutus/position8.htm). This endangers America's ability to create new industries and jobs. American Progress recommends (http://www.americanprogress.org/atf/cf/%7bE9245FE4-9A2B-43C7-A521-5D6FF2E06E03%7d/offshoring.pdf) that the research and experimentation tax credit be made permanent, that the administration increase support for scientific and technology research and update immigration policies to reflect the critical role that immigrants play in enhancing U.S. innovation and competitiveness."

Bush Promotes Outsourcing with 10% Incentive Loophole to Firms Sending Jobs Abroad
Economic Policy

The Progress Report: "The Bush administration has 'embraced foreign outsourcing (http://tinyurl.com/4jdrj)' and endorsed tax policies which encourage job flight. The cumulative effect of current loopholes and tax havens (http://www.treas.gov/offices/tax-policy/library/subpartf.pdf) reduces the average effective tax rate that U.S. companies pay in foreign countries to 21 percent, compared to the 31 percent effective rate they pay in the United States. American Progress recommends the government close loopholes in the tax code that provide incentives for companies to move jobs abroad rather than invest at home."

Bush Administration Calls Outsourcing 'A Good Thing' as Americans Lose Jobs
Economic Policy

The Progress Report: "Days after Americans learned the economy had added just 96,000 jobs (http://washingtontimes.com/business/20041009-123033-4084r.htm) in September (population grew by 220,000), a new report (http://tinyurl.com/5dphm) says the trend of offshoring, when U.S. companies send jobs overseas, 'will grow by 20 percent per year through 2008 (http://www.boston.com/business/technology/articles/2004/10/13/20_annual_rise_in_offshoring_seen/).' At that point, about 60 percent of U.S. firms will send at least some technology work abroad. The Bush administration has called outsourcing 'a good thing' (http://www.cnn.com/2004/US/02/12/bush.outsourcing/), but done little to make the practice palatable for American workers."

'War Time President' Image Means Nothing to Americans Who Can't Pay their Bills
Economic Policy

Al Lewis writes: "George W. Bush's fate on Election Day hinges on the economy. But voters won't care about the chief measure of its strength, the gross domestic product, which is strong despite recent downward revisions. They won't care about the ballooning national debt. Or even rising inflation. What they'll care about is a job. As long as the national unemployment rate holds at its current 5.5 percent, or lower, Bush stands an excellent chance of re-election, according to John Challenger of Chicago-based outplacement firm Challenger, Gray & Christmas." However, Challenger is basing his projections on the pre-outsourcing world and failing to take into account that this is the FIRST TIME IN US HISTORY that American workers in a non-depression period have taken a cut in pay. So it is not just the job now, it's whether that job pays the bills.

The Facts Speak for Themselves: American Workers Have Taken a Huge Hit Under Bush
Economic Policy

Here are the facts, ma'am, from the Bureau of Economic Analysis: Wages: Under Clinton: (plus 3.3 percent); Under Bush: (minus 0.6 percent): Private Industry Wages: Under Clinton: (plus 3.9 percent); Under Bush: (minus 1.1 percent); Personal Income: Under Clinton: (plus 4.0 percent); Under Bush: (plus 3.5 percent). However, Personal income measures the AVERAGE family, not the typical family... If just one person gets much richer, the statistic will show that everyone's average income has increased. This is especially problematic under Bush because Census data show that higher quintiles have done better than lower quintiles in recent years. Thus Bush can use the windfalls of the rich to pad the stats for everyone.

BushMedia's Tinkerbelle Economics: a Gain of 1.25 Points in S&P and Soaring Crude Prices are 'Good News'
Economic Policy

In a Peter Pan fantasy world, all you have to do is clap your hands and wish really hard and Tinkerbelle will come back to life. That apparently is the model Bush & Co. use for their economic policies. In this fantasy world, rising prices, soaring oil costs, the loss of over 1.8 million jobs, the reduction in average pay, and an historic low for Standard & Poors are an "economic upturn" because Bush and co. are wishing really hard that it is. Here's a prime example: In this Tinkerbelle article from the Bushie Bloomberg newswire, it is implied that the reader should be thrilled because not only has the S&P climbed 1.25 percent, but rich folks are getting wealthy off soaring crude oil prices that soak the average citizen. Yep, just clap your hands and wish real hard!

Common Sense for 2004: How to Bring Back the Middle Class
Economic Policy

Mary Schweitzer writes, "The middle class today comes from having more education, and then paying people who serve us with enough income and benefits that they can be comfortable. It is a win-win situation. If instead of giving a tax break to the very wealthy, who already get enough tax breaks, why don't we use the same money for more teachers per pupil, more nurses per patient, more social workers per battered or abandoned child, more police on the street, more firemen back at work? If we don't have enough doctors, why not pay for medical educations and pay back those hefty student loans that doctors had to take out? This is what happened back in the 1950s when the soldiers returned from World War II and went back to school on the G.I. Bill. They got educations, then turned that around to benefit the whole society for the next forty years. This way, we get more of the services we need, we pay people better, and not only are we better off as a nation - the middle class is back again!"

Wealthy G-8 Nations Refuse to Take Definitive Action on Debt Relief for Impoverished Nations
Economic Policy

Common Dreams: "Over the past several days press reports had indicated that UK Prime Minister Tony Blair had put forth a proposal for 100% debt cancellation for poor countries. This afternoon, however, the leaders of the Group of Eight wealthy nations instead announced a meager 2-year extension of the Heavily Indebted Poor Countries (HIPC) Initiative instead of a definitive commitment to full cancellation."At this critical moment, when every minute another African child dies of AIDS, the global community needs 100% cancellation of multilateral debt without harmful conditions," said Marie Clarke, National Coordinator of the Jubilee USA Network. "By failing to seize the opportunity, the G-8 has once again chosen baby steps over bold action.""

National Embarrassment: US Sec. of Commerce Reduced to Peddling 'Economic Optimism' on Rightwing Talk Shows
Economic Policy

This is pathetic! The smoke and mirrors of the Bush "recovery" is wearing so thin that they have resorted to sending Don Evans out to sing to the rightwing choir about just how darn rosey the economy is. Here he spouts his line on the Rush Limbaugh show, blaming any negative attitude on the "recovery" on the media and liberals, rather than the lack of decent jobs (i.e., those not part-time, not at Wal-mart or McDonalds, not temporary, and not without any benefits). "You know, it is really, really tough to break through the negative media that's out there. I mean that's just pure and simple. I mean as you say the other side, it's a political year, and they continue to try and find every little bit of data they can to try and convince the American people that the economy is bad. I mean, you know, they're always looking at the economy being -- the glass being half empty as opposed to half full." LOL!!!

Reagan/Bush 'Optimism' Built on the Backs of the Working Class and Poor
Economic Policy

It's easy to be optimistic when you are spending other people's money - the inheritance of future generations, to be exact - and don't have to pay the piper yourself. Both Reagan and Bush gave the illusion of "returning money" to taxpayers through tax cuts that benefitted the upper income levels. Yet both ran the federal deficit up to record levels. Whose money do you think this represents? Not theirs! Giving a tiny tax cut to most Americans while running up the deficit by billions is the same as giving someone a three-bucks-a-week raise, then stealing their life savings and transferring it into the accounts of several ultra-wealthy corporations. Yep, easy to be optimistic when YOU are one of the few on the receiving end. Here's a Social Studies 101 lesson in the Federal budget.

Are Greenspan and the White House Colluding to Manipulate the Economy?
Economic Policy

Using FOIA, economist Kenneth Thomas has revealed that Alan Greenspan's relationship with the White House goes far beyond the usual President-Fed connection. Carried by a limo, Greenspan travels to the White House regularly for "tete-a-tete's" not just with Bush, but with Cheney, Rice, Powell, and Andy Card. Since Bush took office, Greenspan's visits to the White House have quadrupled (over the number of visits made to Clinton's White House). This pattern is suspicious, to say the least, and has prompted Thomas to ask: How involved is the Fed chairman in setting White House policy? And do those friendships with top Bush officials influence what Greenspan does with interest rates? Many economists believe that artifically depressed interest rates have kept major economic indicators misleadingly pumped up - to Bush's advantage.

Outsourcing Is All About Taking American Capital Back to the 19th Century
Economic Policy

Historian Robert E. Mutch writes that outsourcing isn't about trade, it's about jobs and wages -- since American workers expect living wages and livable working conditions, American capitalists are moving the jobs to where they can operate sweatshops and keep all the profits themselves. "We used to think the social progress of the twentieth century would spread to the rest of the world. What may happen instead is that our communities will join the rest of the world by falling back into the 19th century." Bush and his minions, such as economic adviser Gregory Mankiw, think this is a good thing. The only way to conserve the social and economic progress for which so many patriots fought long, hard campaigns is to re-defeat Bush this November.

Bush Manipulation of Interest Rates and Iraq Policy are Fueling Confrontation with OPEC
Economic Policy

The Bush administration's manipulative policies are the primary cause for rising gas prices. In addition to manipulating the Strategic Petroleum Reserves, Bush has artificially propped up selected economic indicators by keeping interest rates abnormally deflated. Interest deflation has, in turn, caused the dollar to plummet. And, because OPEC's oil currency is US dollars, this has led to an erosion of OPEC oil. To offset this loss, OPEC has toyed with either raising prices directly or cutting production (which would raise prices). And, thanks to Bush's inflammatory policy toward Iraq, OPEC, which had, at the start of the war pledged to do all it could to keep oil supplies steady, is no longer in a mood to be helpful. Thanks, G. W. (as in G.lobal W.reckingball!).

The Big Bush Boom is a Bust
Economic Policy

According to the government's Bureau of Economic Analysis, the wage and salary component of U.S. personal income rose 4.6 percent, slightly less than the 4.8 percent increase in the price index for personal consumption over the period. So where is the income growth needed to support increased consumption and the promised Bush Economic Boom going to come from? Probably not from big wage increases. Average hourly earnings rose only 1.7 percent in the 12 months ended in February. A broader measure, the wage and salary portion of the Bureau of Labor Statistics' employment cost index, increased 2.9 percent last year, enough to keep workers a bit ahead of inflation, though not by much. And those big $300 refunds have already been spent.

Serfs for Bush
Economic Policy

Thom Hartmann, who is the host of the noon hour radio show, Uncommon Sense from the Radical Middle, makes the compelling point in his latest article in Common Dreams that the middle class is a creation of an enlightened governmental intervention in the business cycle. Hartmann points out that without government intervention, what is left is a small, class of rich owners, a few middle class merchants, who provide services and product to those owners, and a huge underclass of workers, who live in continual fear of losing their jobs. The obvious conclusion is that a vote for Bush is a vote for the reemergence of a serf class in the United States. Can you say, "Welcome to Walmart?"

Bankruptcy Filings Set Record
Economic Policy

So much for that "big recovery" our wise economic steward claims comes from giving money to billionaires: March 13, 2004 One out of every 73 U.S. households filed for bankruptcy last year, a record high, despite historically low interest rates, the American Bankruptcy Institute said. "Despite enjoying the sustained benefit of low interest rates, growing numbers of U.S. consumers are facing difficulty in meeting their monthly obligations," ABI Executive Director Samuel Gerdano said. U.S. households had $10.4 trillion in debt outstanding at the end of last year, although debt accumulation slowed toward year's end, according to data from the Federal Reserve. Last month, the Administrative Office of the U.S. Courts said there were 1,660,245 personal bankruptcies last year. It was a record for any calendar year, but off slightly from the all-time 12-month high reached in the period ended in September.

A View from the Right: The Jobs Crisis and the GOP
Economic Policy

Pat Buchanan writes for the Richard Mellon Scaife funded, rightwing World Net Daily: "The U.S. trade deficit is the greatest foreign aid and wealth transfer program in history, and our workers are paying for it by the loss to their families of the American Dream... For the Bush Republicans, the chickens are coming home to roost... At a weekend conference on immigration and jobs hosted by The American Cause, which this writer chairs, one speaker blurted out that while he voted for Bush in 2000, he would never do so again. The room erupted in applause, though virtually all there were conservatives, and all had once been Goldwater-Nixon-Reagan Republicans."

CBO: Bush Tax Cuts Won't Jumpstart Economy and Could Make Things WORSE!
Economic Policy

Northwest Indiana News: "The tax cuts and other policies Bush proposed in his $2.4 trillion budget would probably have a minimal impact on the economy, the nonpartisan Congressional Budget Office said Monday. In its annual report on the president's budget, the agency that provides fiscal analysis for lawmakers said Bush's proposals could either increase or reduce [as in make things worse!] economic output through 2009, and improve it in the following five years. [yeah, that ought to really excite the unemployed in 2004!]. However, the differences are likely to be small, affecting output by less than one-half of one percentage point on average," the study said."

Bush's Three-Point 'Plan for Jobs and Growth': One-Way Ticket to Nowhere
Economic Policy

This is it folks. This is the "aggressive, detailed plan" Bush has formulated to save the economy - the 'solid, realistic" plan we keep hearing so much about from the Busheviks. As a lady said during an exit poll at a Democratic Primary in California: "My cat could do a better job." Here are the three (and only) Bush goals: 1.: Encourage consumer spending that will continue to boost the economic recovery (yep, all you unemployed folks rush out and start spending!). 2. Promote investment by individuals and businesses that will lead to economic growth and job creation (Too bad all the investment is in India). 3. Deliver critical help to unemployed citizens (like cutting off their unemployment checks and making it harder to collect welfare as an alternative). This isn't a plan, it's a lame joke!

Will Asia Finally Dump the Dollar? Soaring Deficit, Bush Economic Policy May Be the Last Straw
Economic Policy

US liabilities now exceed assets by $3 trillion - and growing. $3 trillion of US debt is owned by foreign nations, mostly Asia. Bush's mismanagement of the US economy has, for the first time, made Asian debt holders fear they will be left holding the bag if they keep their financial reserves in dollars. "The U.S. deficit has been growing for so long that cries of 'wolf' now fall on deaf ears," says the International Herald Tribune: "Could this year's likely current account shortfall of more than $500 billion be the final straw? ...Confidence in U.S. political will to sustain a system based on a sound dollar and free trade principles may be eroding. The persistence of unemployment despite economic growth, the emergence of outsourcing as an issue...suggest there are doubts in America about a system which has promoted U.S. consumption but raised debt levels to unprecedented levels and, arguably, failed to deliver jobs."

Global Authorities Suspect Washington is Pushing Dollar's Decline in Pre-Election Ploy
Economic Policy

BBC reports: "The dollar has sunk against other major currencies, squashing hopes that a meeting of leading industrial nations in Florida could stem its decline. The meeting of finance ministers from the Group of Seven had condemned 'excess volatility' in exchange rates. The warning was a dig at the way US authorities have encouraged the dollar's slide, at first underpinning a rally for the greenback. The dollar has sunk rapidly against the yen, the pound and the euro in recent months, in the face of apparent tacit US sanction of its decline. The trend has worried policy-makers elsewhere, who fear their own fragile economic recoveries could be damaged if their exports are priced out of the lucrative US market. The imminence of a US election in November could also be a factor, with a weak dollar [temporarily] enhancing US exports and therefore perhaps catalysing a growth in employment."

Bushonomics: The Rich Get Richer and the Poor Get the Shaft
Economic Policy

The Washington Post reports what Americans have already seen for themselves: the rich have benefited from Bush's economic policies -- for example, executive bonuses increased 20 to 30 percent last year. But the only things that have increased for working people and the poor are unemployment, bankruptcies, and insecurity. George W. Bush keeps talking up the economic "recovery", but a jobless recovery is like a foodless banquet.

I.M.F. Says Bush's Deficits Threaten World Economy
Economic Policy

"With its rising budget deficit and ballooning trade imbalance, the US is running up a foreign debt of such record-breaking proportions that it threatens the financial stability of the global economy, according to the IMF. The report sounded a loud alarm about the shaky fiscal foundation of the US, questioning the wisdom of the Bush administration's tax cuts and warning that large budget deficits posed 'significant risks' not just for the US but for the rest of the world. The report warned that the net financial obligations of the US to the rest of the world could equal 40% of its total economy within a few years - 'an unprecedented level of external debt for a large industrial country' that it said could play havoc with the value of the dollar and international exchange rates... Bush's deficit reached $374 billion last year, a record in dollar terms but not as a share of the total economy, and it is expected to exceed $400 billion this year."

A Nation of Wal-Mart Workers
Economic Policy

"Can we afford to shop at Wal-Mart if we're all working there? Or will the most massive national debt in history beggar our future? Imagine for a moment that you took all your credit cards and maxed them out. Now take your mortgage and borrow the maximum on it. Cash in the kid's college fund, your rainy day savings, your 401(k) retirement savings. While you're at it, stop paying for your health insurance and the maintenance on your house, your car and your yard. Now take all that money and spend it. Feeling pretty flush? Sure you are. You just pumped tens, maybe hundreds of thousands of dollars into your pocket. But you'd never do that. Because you know that just because you'd be living large for the time being, you wouldn't be wealthier. In fact, you'd be getting poorer by the minute. And yet, that's exactly what Mr. Bush's recovery is - a giant borrowing binge."

Bushnomics is a Form of Looting
Economic Policy

George Akerloff, Nobel prize winner in Economics, characterizes the Bush economic policy as a "form of looting."

How Tax Lawyers Help the Super-Rich Hide their Money to Avoid Paying Taxes
Economic Policy

Jonathan Blattmachr is one of "16,000 or so lawyers in America who specialize in trusts and estates, the passing of wealth from one generation to the next... Blattmachr's practice exists because America has two tax systems, separate and unequal. One is for wage earners, and most of us know firsthand that that system works effectively. The other is for the wealthy, who control much of what the I.R.S. knows about their finances and who in recent years have paid a shrinking share of their incomes to sustain the civilization that makes their riches possible. Few of us also know that this means that the 400 Americans who reported the biggest incomes in 2000 paid just 22.3 cents out of each dollar in federal income taxes. That is about the rate paid by a single person making $125,000. Wealth is more concentrated in America than at any time since 1929. Tax specialists like Blattmachr have done their part, but the tax code itself -- written and approved by Congress -- also stacks the deck."

Bush Walmartizes America
Economic Policy

Aaron Bernstein writes in Business Week that we are experiencing the "Wal-Martization" of America - "hiring temps and part-timers, fighting unions, dismantling internal career ladders, and outsourcing to lower-paying contractors at home and abroad." As he notes, "More than a quarter of the labor force, about 34 million workers, are trapped in low-wage, often dead-end jobs." What does that mean? "The result has been an erosion of one of America's most cherished values: giving its people the ability to move up the economic ladder over their lifetimes."

Red Alert: GOP Plans Sweeping New Welfare Reforms
Economic Policy

"Given the state of our economy, one might expect a welfare reauthorization bill to offer emergency assistance to the poor and aid to those trapped in the low-wage workforce. Instead, the so-called Personal Responsibility and Individual Development for Everyone (PRIDE) bill that has just come out of the Senate Finance Committee, like the more extreme bill passed in the House, shows that lawmakers are willfully oblivious to the challenges facing welfare reform. No jobs to be found in our economy? Let's increase the work requirements for welfare recipients. No money in the budget for social services? Let's launch a new $1 billion program to cajole women down the aisle. Job training needed? Let's cut the amount of time that recipients can devote to literacy or vocational education. The provisions in the PRIDE legislation are not only bad as individual proposals, they reflect a punitive vision of welfare reform that can never address the root of persistent poverty in America."

U.S. Dollar at 3-Year Low, With Its Future Dependent Entirely on Charity of Japan and China
Economic Policy

What most Americans may not realize is that the only reason the U.S. dollar has not already collapsed under the weight of Bush economics, is intervention by the Japanese and Chinese governments. However, with Japan's economy reeling, this help is evaporating. "The strong dollar policy is now officially declared dead and the dollar index will correct lower," says a Morgan Stanley currency economist in London, who adds hopefully, "But I don't think Japan will stop intervening -- especially because if all of Asia cease to intervene, it will certainly lead to the collapse of the dollar." However, Japan's increasing reluctance to intervene has prompted the Bush administration to being to bully Japan and Asia into helping prop up its failing currency. So our "recovery" now features both escalating job losses and a collapsing dollar!

GAO Chief Calls on 'Responsible Parties' to 'Recognize Reality' about the Budget; The Bush Gang are Certainly 'Responsible' -- for This!
Economic Policy

"The federal government's budget is in far worse shape than most Americans realize, and the fiscal hole is deepening, the head of Congress' nonpartisan watchdog agency said Wednesday. 'Our projected budget deficits are not manageable without significant changes' in taxes or spending, U.S. Comptroller General David Walker said in a speech to the National Press Club. 'We cannot simply grow our way out of this problem.' Walker, who heads the General Accounting Office, said he is a nonpartisan auditor whose job is to 'state the facts and speak truth' about the nation's bookkeeping. Current accounting systems fail to adequately reflect just how severe the government's fiscal problems are, he said. 'The time has come for all responsible parties to recognize reality,' Walker said. 'Our nation has a major long-term fiscal challenge that is not going away.'"

IMF Report Says Bush Deficits are a 'Noose Around the Neck of the Economy'
Economic Policy

"The International Monetary Fund yesterday warned that the colossal United States trade deficit was a noose around the neck of the economy, emphasising that the once mighty dollar could collapse at any moment. Arguing that the world's big economies were already too dependent on the willingness of American consumers to live beyond their means, the IMF said the US could not continue to run a current account deficit of 5% of GDP. The IMF's chief economist Kenneth Rogoff said that it was just a matter of time before the gap closed, tipping the dollar into a potentially steep fall.... In its twice yearly report on the world economy, the Fund warns that even a controlled slide in the dollar's value is likely to slow US growth and unless other countries picked up the slack, the global economy would suffer."

Former World Bank Chief Slams Bush's Trade and Fiscal Policies
Economic Policy

Joseph Stiglitz writes, "In 2001, Resident Bush misled the American people. He said that a tax cut that was not designed to stimulate the economy would stimulate it. But it did not.... This year...after persuading Congress to pass another tax cut - in some ways even more inequitable than the first - his administration revealed how bad the fiscal position had become. The $230bn surplus inherited from Clinton had turned into a $450bn deficit. Meanwhile, the US trade deficit is mounting. America, the world's richest country, evidently can't live within its means, borrowing more than a billion dollars a day. As the US thrashes around for someone to blame, it is inevitable that it will focus on China, with its large trade surplus.... But this is blame shifting, nothing more. America's fiscal and trade deficits are intimately linked. If a country saves less than it invests, it must borrow the difference from abroad, and foreign borrowing and trade deficits are two sides of the same coin."

Clueless in Crawford
Economic Policy

Bob Herbert writes, "Bush and his clueless team of economic advisers held a summit at the resident's ranch in Crawford, Tex., yesterday. This is the ferociously irresponsible crowd that has turned its back on simple arithmetic and thinks the answer to every economic question is a gigantic tax cut for the rich. Their voodoo fantasies were safe in Crawford. There was no one at the ranch to chastise them for bequeathing backbreaking budget deficits to generations yet unborn. And no one was there to confront them with evidence of the intense suffering that so many poor, working-class and middle-class families are experiencing right now because of job losses on Mr. Bush's watch. After the meeting, Mr. Bush said, 'This administration is optimistic about job creation.' It's too bad George Akerlof wasn't at the meeting. Mr. Akerlof, a 2001 Nobel laureate in economics, bluntly declared on Tuesday that 'the Bush fiscal policy is the worst policy in the last 200 years.'"

Bush Embraces Voodoo Economics
Economic Policy

Daily Enron reports, "Bush recently ventured to Michigan and Pennsylvania for the dual purposes of high-dollar fundraising, and 'touting' his economic plan despite two years of backsliding economic figures. Unemployment figures are at record levels. Federal deficits are approaching $500 billion annually. What was Bush's grand solution? Patience. The effects of the tax cuts are sure to trickle down sooner or later. In a stunning political turnabout, Bush delivered strong rhetoric in support of expanding the child tax credit to the lowest-income Americans, stating, 'I want the benefits of tax relief all across the spectrum of our society.' Perhaps this statement should also be attributed to British intelligence... Six and a half million low-income families were denied the expanded child tax credit in the Republican-drafted legislation that Bush recently signed into law."

Bush Holds Retiree Checks Hostage to Push Through Tax Cuts that Will Bankrupt Social Security
Economic Policy

"The Bush administration warned Congress on Monday it would run out of room by May 28 to juggle the government's books to stay within the current national debt limit." AP reports: "Legislation to boost the debt limit by $984 billion -- the largest increase in history -- has been caught up in a battle between Democrats and the White House over President [sic] Bush's proposed new tax cuts. In a letter to congressional leaders, Treasury Secretary John Snow said Treasury set May 28 as the date it would exhaust its avenues for clearing extra room for borrowing. Payments to Social Security retirees and other government obligations would be jeopardized after that time... Sen. Kent Conrad, D-N.D., criticized Snow's letter, saying Republican tax-cut policies will push the national debt to $12 trillion by the end of 2013, right before a wave of baby boomer retirements dramatically increases demands on Social Security."

Treasury Says U.S. Could Face Default - Thanks to Smirk-o-nomics!
Economic Policy

"The Treasury Department says the United States could face the prospect of not being able to pay its bills in late May unless Congress raises the government's borrowing authority, now capped at $6.4 trillion... 'on current projections, the extraordinary measures taken since Feb. 20, 2003, will only be adequate to meet the government's needs until the latter half of May,' said a statement released Tuesday... Last year, Congress boosted the old debt limit by $450 billion, from $5.95 trillion to the current $6.4 trillion. At that time Treasury warned that Congress would need to again increase the government's borrowing authority... Republicans blame the lingering effects of the 2001 recession and the costs of fighting terrorism for the need to extend the debt limit." Hey, it was Bush's $2 trillion tax break -- mostly to the wealthy! And now Republicans want up to $500 billion more in tax cuts through 2013. Remember when Clinton-Gore were on track to pay down the debt by 2013!

Bush Discards American Workers - Let Them Eat Cardboard
Economic Policy

Bob Herbert writes: "Among the many things overshadowed by the war is the substantial human toll that is quietly being taken by the faltering U.S. economy. Putting Americans to work is not part of the agenda of the Bush administration, and the fallout from this lack of interest is spreading big time... There doesn't seem to be much awareness in the Bush administration of the terrible distress of the unemployed American worker. This is an ache that does not extend to the gilded towers of the very wealthy, which is where the administration has always focused its concern. The White House response to the latest job loss figures [2 1/2 million during Bush II] is the same response it has had all along to bad economic news: more tax cuts are the cure. [An unemployed executive from a 'Republican background,' said he feels the American worker has been abandoned.] 'Robert Reich always talked about the work force as a national asset. It is. We should treat it that way.'"

Governors Conference Slams Bush - Texas Gov. Perry Goes Home in a Snit!
Economic Policy

"Democrats sharply criticized Bush's budget proposals, while even fellow Republicans questioned the details. There also was some dismay that the governors' association, seeking a unified position on behalf of the states, was too harsh in assessing Bush's spending plan. Bush's successor as Texas governor, Republican Rick Perry, quit the organization, partly to save $160,000 in annual fees and partly because he was unhappy with what he believed was its criticism of the Bush administration, 'Open criticism of the resident is not an approach Governor Perry favors' spokeswoman Kathy Walt said."

Greenspan and Bush in Public Clash
Economic Policy

"In a rare rift with Alan Greenspan, the White House has taken issue with the Fed chairman's assessment that now is not the time to boost the economy - at least not along the course Bush has chosen...Republican sources & economists said Greenspan may have thrown his future into question by breaking publicly with Bush on tax cuts. Some Bush allies were fuming after Greenspan bluntly told Congress in closely watched hearings on Tues. that stimulus was not needed right now and warned of the dangers of rising budget deficits... in a second day of testimony, Greenspan sought to minimise the differences, endorsing Bush's proposal to eliminate the double taxation of share dividends. Greenspan's testimony has presented the White House with a difficult course. The Fed chairman's influence is such that his opposition could sway votes when Congress considers the full tax-cut proposal. The plan aims to lift the sagging economy and faltering share prices before next year's election campaign."

Rep. George Miller Denounces Republican Class Warfare in Rip-Roaring Speech to AFL-CIO
Economic Policy

George Miller (D-CA) declared, "We are being fed a steady Republican diet: unprecedented tax cuts for the richest 2% of Americans and givebacks by the working men and women of America. Trade policies that have no regard for the devastating impact of unfair trade on American families. Over 3/4 of Americans say 'protecting the jobs of US workers should be a top priority in trade agreements.' But 800,000 American jobs have been lost thanks to NAFTA, and this Administration thinks that agreement is working great! Tax policies that reward companies for moving offshore and for locating in cheap labor nations, not to build up foreign markets, but to export cheap products back to the Wal-Marts and K-Marts of America. Changes to pension rules that allow companies to slash the retirement benefits of hundreds of thousands of hardworking employees, and even refusing to extend Unemployment Insurance during the holiday season or consider a reasonable increase in the Minimum Wage."

Even Republicans Agree - Bush Is An Out of Control Madman
Economic Policy

Paul Krugman writes "Although financial reporters have started to realize that Mr. Bush is out of control -- he has 'lost his marbles,' says CBS Market Watch - the sheer banana-republic irresponsibility of his plans hasn't been widely appreciated. That $674 billion tax cut you've heard about literally isn't the half of it. Even according to its own lowball estimates, the administration wants $1.5 trillion in tax cuts over the next decade - more than it pushed through in 2001... Mr. Greenspan must know that many people, whatever they say in public, now regard him as a partisan hack. That very much includes Republicans, who assume that he will support anything Mr. Bush proposes... This may be Alan Greenspan's last chance to save his reputation - and the country's solvency."

Blue Monday: W-ar Threat Pushes Dow Below 8,000
Economic Policy

CBS reports, "Stocks fell on Wall Street and abroad yesterday as investors faced a week packed with uncertainty about a war with Iraq, the outlook for corporate earnings and the economy over all... During a day in which the three major market gauges on Wall Street fell more than 1.3% - the Dow Jones industrial average closed below 8,000 - and several main markets in Europe were down more than 3%, investors continued to receive mixed signals on the immediacy of a war with Iraq." The Dow reached its lowest level since last October, when it hit 5-year lows.

Bush Tax Break Boosts Regal Class
Economic Policy

Ian Urquhart writes, "It's interesting to imagine how long it took - after the first plane hit the World Trade Center - before the Bush administration fully grasped the enormous opportunities that had just opened up. If that sounds crass, I hasten to point out that I'm not the one who has taken advantage of the anxious post-9/11 political climate, in which it's considered unpatriotic to criticize or even question the White House. The Bush administration has effectively exploited this climate to push forward dubious policies that, in more relaxed times, would be subject to considerably more scrutiny and debate." Read on for an astute analysis of Bush's new "stimulus plan."

Democrats Prove Bush Has WORST Job Creation Record, so Bush Blames Clinton!
Economic Policy

NY Times reports as "Bush prepares to announce a proposal next week for deep new tax cuts, House Democrats plan to circulate a mischievous little chart aimed at skewering him on what they say is one of his biggest vulnerabilities, unemployment. The chart, based on standard government statistics, measures the number of jobs created under every president since Harry S. Truman and ranks Bush as DEAD LAST by a wide margin... Although President Bill Clinton averaged more than 230,000 new jobs a month in his eight-year tenure, the chart shows, Mr. Bush has averaged a loss of 69,000 jobs a month since he took office. Although every other president is at least slightly above the zero line, Mr. Bush is conspicuously below it... White House officials quickly dismissed the chart and cited their figures to argue that the economic problems originated under Mr. Clinton." Hey George - when are you going to stop blaming Clinton for your failed policies, and start taking PERSONAL RESPONSIBILITY?

Harvard Economist is Bush's Economic Guru and Eli Lilly Board Member
Economic Policy

NYTimes.com profiled Martin S. Feldstein, the Harvard economist whose former students comprise a significant number of Bush's administration ("the Bush administration's economic team begins to look like a Feldstein alumni club"), and who is slotted for Alan Greenspan's job at the Federal Reserve. "For his part, Mr. Feldstein has shown little taste since the 1980's for straying from the Republican Party line. In 1992, he predicted that the Clinton administration's tax increase would stifle economic growth and do little to erase the deficit." (Well, we know how wrong that turned out to be!) An article he wrote for The Wall Street Journal in 2000 was headlined 'Bush's Tax Plan Is Even Better Than the Campaign Says.' (Mr. Feldstein helped create the plan.)" [The economy tanked.]..."Mr. Feldstein and his wife (wrote), 'Paul O'Neill was an inspired choice for secretary of the Treasury.' Mr. Feldstein is also on the board of Eli Lilly, the pharmaceutical company with strong Republican ties."

The Visa Party
Economic Policy

Brian Balta writes: "The Republican Party of George W. Bush is, first and foremost, the party without consequences. No, I'm not saying that everything the Republicans do turns out perfect. Of course I don't believe that; if I did I wouldn't have been shivering out in the rain on Election Day trying to elect Democrats. What I mean is that, under George W. Bush, the Republican Party has virtually never admitted that there may be consequences to anything they do. Every single initiative that they undertake,...has only a positive side. In fact, everything they suggest shows a blatant disregard for consequences not only in the way it's presented, but also in the way that it was conceived. Take every single program that they have proposed, and they all follow this pattern. The Department of Homeland Security? When it was originally proposed, it was to be budget neutral,...Never once would you hear Mr. Bush admit that their may be additional costs associated with the reorganization."

White House Drafts Financial Short-Lists
Economic Policy

Beth Piskora writes: "The first domino was Harvey Pitt. Now the question is how long will it take other members of Bush's inept economic team to fall away. William Webster is the next to go, sources said. After that, said sources familiar with Bush's thinking, the administration will likely replace chief economic adviser, Larry Lindsey, and Treasury Secretary Paul O'Neill. The White House also intends to exercise great influence choosing new heads of the Office of Management and Budget and the Congressional Budget Office, where the current directors are on the way out. The Treasury secretary is clearly the most important job, and Bush and Dick Cheney have been meeting with potential candidates for more than a year."

Last Night's Other Big Loser: The Balanced Budget
Economic Policy

Daniel Gross writes in Slate: "prospects have... improved for several other Republican economic projects that have been bottled up by Senate Democrats, including tax breaks for investors who have taken losses and tax cuts for profitable corporations. Such moves may or may not help jump-start the sputtering economy. But they will virtually guarantee a return to the era of structural budget deficits. That may be the most far-reaching economic implication of yesterday's unexpected Republican sweep. We are now blessed with a Congress and executive branch devoted to the proposition that the government should spend, but not tax. (And what's more, it shouldn't try too hard to collect the taxes that are owed, especially if they're owed by companies or the cheating wealthy.) Last month, the books were closed on a disastrous fiscal 2002. The government ran its first deficit since 1997's $157 billion - and the $6.3 trillion, 10-year surplus that Bush inherited all but evaporated."

Begala says, 'Why Should We Be Scared Of Someone Who Couldn't Even Get As Many Votes As Al Gore?'
Economic Policy

Paul Begala speaks on the economy: "We should stand four-square against Bush's economic policies. They're bad policy, bad economics and bad morality. Democrats should call for a smaller tax cut that targets the middle class and working poor. Reducing the payroll tax would have more stimulative effect and do less damage to the deficit. It would create jobs and put cash in the pockets of people who need it most. That's Democratic economic thinking. I just can't believe there's a Democrat with a brain who's scared of Bush. Why should we be scared of someone who couldn't even get as many votes as Al Gore?" On Social Security: "Bush and his people hate social security. They want to privatize social security. Every one of the three proposals from Bush's commission would cut guaranteed social security benefits -- even if you decide not to gamble your social security in the stock market." Read Paul Begala's interview on his new book, "It's Still the Economy, Stupid."

The Buck Stops Where?
Economic Policy

"Bill Clinton was handed the largest nominal deficits in history, a shaky, stop-and-start economy, and an unemployment rate over 7% (nearly 10% in CA and more than 11% in WV). There was negative economic growth in the first quarter of 1993. In the face of these economic challenges, he took tough action to cut the deficit, open new markets for trade, and invest in people -- action that helped to strengthen the investment climate and lay a solid foundation for economic growth and poverty reduction. The economy that...Bush inherited was slowing, but was also bolstered by strong productivity, very low unemployment, several years of across-the-board income growth, and the strongest fiscal situation ever inherited by an American president. What our economy needed in 2001 was the type of disciplined economic management that inspires confidence, a continued commitment to long-term fiscal discipline, and a strong, targeted effort to stimulate the economy to avoid a prolonged downturn."

For Richer: The New Gilded Age and America's Future
Economic Policy

New York Times columnist Paul Krugman analyzes economic inequality in America, and the profound effects -- economic, social and political -- of that widening gap. Since the gap between the rich and the rest of us has returned to the levels of the "Gilded Age" of the robber barons, Krugman notes that you might expect to see proposals to address this inequality. Not so, says Krugman. By channeling vast sums of money into think tanks, media and other institutions that promote right-wing causes, the wealthy can buy more than political influence; they can shape public perceptions as well. "This obviously raises the possibility of a self-reinforcing process....Economic policy increasingly caters to the interests of the elite, while public services for the population at large -- above all, public education -- are starved of resources." But look on the bright side: As the robber barons of the first Gilded Age knew, uneducated, desperate people make the very best servants.

On Economics, Democrats Beat Republicans Every Time - And Bush Is The WORST!
Economic Policy

"Welcome to the Economic Sweepstakes Quiz. The rules are simple. Guess which president since World War II did best on...good economic management. You can choose among five Republicans...and five Democrats...Which president produced: 1. The highest growth in the GDP? 2. The biggest increase in jobs? 3. The biggest increase in personal disposable income after taxes? 4. The highest growth in industrial production? 5. The biggest rise in hourly wages? 6. The lowest Misery Index (inflation plus unemployment)? 7. The lowest inflation? 8. The largest reduction in the federal budget deficit? [The] answers: 1. Truman; 2. Carter; 3. Johnson; 4. Kennedy; 5. Johnson; 6. Truman; 7. Truman; 8. Clinton. A Democratic sweep. If this isn't enough to destroy the myth that the economy has performed better under Republicans, consider that the stock market has historically fared better when a Democrat is in the White House [and] that figure is even higher if you factor in last year's nose-dive."

Iraq Around the Clock: What About Jobs?
Economic Policy

Last night Bush said he wouldn't risk a single American life by trusting Saddam Hussein. We don't have to. We have Saddam under our thumb now, and need not fear him unless we behave stupidly. Saddam did not use his worst weapons during the Gulf War, because he was not endangered. Bush's rash, reckless policies will threaten Saddam with utter destruction, undermine deterrence, and encourage him to do his worst. Bush's policy as stated is madness. It makes sense only as a distraction to make us vote our fears rather than our hopes. Even Bush understands Iraq is no threat. Otherwise why would he spend day after day raising money for Republicans and attacking Democrat's patriotism? Bush desperately talks about attacking Iraq to keep us from talking about other things. Such as: Bush's corporate scandals with Enron and Harken; Dick Cheney's double dealing with Enron when he should have been leading the anti-terror task force which never met even once.

Stock Market Does 50% Better under DEMOCRATS
Economic Policy

"Democrats, it turns out, are much better for the stock market than Republicans. Slate ran the numbers and found that since 1900, Democratic presidents have produced a 12.3% annual total return on the S&P 500, but Republicans only an 8% return. In 2000, the Stock Trader's Almanac, which slices and dices Wall Street performance figures like baseball stats, came up with nearly the same numbers (13.4% versus 8.1%) by measuring Dow price appreciation. (Most of the 20th century's bear markets, incidentally, have been Republican bear markets: the Crash of '29, the early '70s oil shock, the '87 correction, and the current stall occurred under GOP presidents.)" We always suspected you had to be rich and/or stupid to vote Republican - but this proves it!

On the Economy, It's Deja Bush All Over Again
Economic Policy

Ron Brownstein "ran the numbers" on Bush, and they stink:

Median income
Bush I: down 4.9%
Clinton: up 14.5%
Bush II: down 2.2%

Americans in poverty
Bush I: up 6.5 million
Clinton: down 7.7 million
Bush II: up 1.3 million

Job creation
Bush I: 2.3 million new jobs
Clinton: 22.9 million new jobs
Bush II: 1.5 million fewer jobs

Federal budget
Bush I: deficit of $290 billion in last year
Clinton: surplus of $236 billion in last year
Bush II: deficit of $160 billion in latest year

Unemployment rate
Bush I: up 1.9%
Clinton: down 3.1%
Bush II: up 1.5%

Percentage of Americans without health insurance
Bush I: up 1.4%
Clinton: down 0.8%
Bush II: up 0.4%

Shrub "chose to put all his chips on a huge tax cut that blew a hole in the federal surplus, may increase upward pressure on long-term interest rates and has severely crimped his ability to [address] the increase in poverty or the decline in health-care coverage."

Domestic Programs, Including Education, Are On the Cutting Block to Fund W-ar
Economic Policy

WashingtonPost.com reports: "Bush will look for new ways to restrain growth of domestic programs - including education spending he considers wasteful - as he struggles to pay for an indefinite war on terror with falling tax revenue... [OMB Director] Daniels said that apparently for the first time in history, the economy is growing but revenue is shrinking, in part because of the weak stock market. Combine falling revenue with a growing cost of war, he added, and spending will have to restrained elsewhere... 'To avoid the guns-and-butter mistake, we're trying to hold everything nonsecurity-related to very severe scrutiny' [said Mitch Daniels, citing] expenditures on literacy training for prisoners." Yeah, that'll work: by a 12th-grade standard, 75% of inmates are illiterate and prisoners have a higher proportion of learning disabilities than the general population [including 75-90% of juvenile offenders] per ERIC research. Where are librarian Laura and pro-literacy Bar on this issue?

Bush is 'Fundamentally Uninterested In and Uncomfortable With Economic Policy'
Economic Policy

Paul Krugman writes: "This is the way the recovery ends - not with a bang but with a whimper... Industrial production is falling and layoffs are rising. But it's still not a sure thing that the months ahead will be bad enough for the business-cycle referees to declare a renewed recession. And on the other hand, the administration seems determined to have a bang sometime before Nov. 5.... Most people don't care whether G.D.P. growth is slightly above or below zero; what matters to them is whether they can find jobs and keep them. And the job situation is increasingly dismal. A 5.7% unemployment rate doesn't sound that bad, but an unusually large number of workers have given up searching for jobs. The overall unemployment rate also doesn't reflect the rapidly growing number of people who are truly desperate, because they have been out of work for six months or more.... The number of people filing new claims for unemployment insurance... has increased sharply over the past month."

Bush Demonstrates Same Financial Insensitivity to Americans' Economic Distress as His Father
Economic Policy

Bush Junior declared "the fundamentals of our economy are sound" at his cheerleading rally Economic Summit, but the facts strongly suggest otherwise. As Kelly Kramer of Spin Resistance notes in recent headlines: "Ames announces plans to Close All Stores (22,000 Americans will lose their job); IBM is Cutting More than 15,600 jobs; Agere Plans to Cut 4,000 jobs; Johnson & Johnson to eliminate TX jobs, 180 jobs lost; Flextronics to cut 5,261 jobs; Charles Schwab announces plans for more major layoffs 375 jobs (as founder Schwab attended Bush's economic summit); American Airlines to cut 7,000 jobs - that's 54,416 jobs lost in the last THREE DAYS! And at the same time, US Airways files for bankruptcy, United Airlines announces bankruptcy is more than likely. Oh yeah, and the stock market tanked (again)…To say the economy is 'sound' is either completely idiotic or a bold faced lie...take your pick."

It's the Economy, Stupid - Yes George, We Mean YOU
Economic Policy

The Daily Enron reports, "You can almost smell the fear emanating from the White House strategy sessions leading up to [the] economic forum in Waco, Texas. Administration strategists - some of whom also worked in Bush's father's administration - were experiencing disturbing flashbacks this week. They remembered those sweet days of high poll ratings in the wake of the Gulf War. And, then they recalled the cold shower they got from voters just two years later when the domestic economy tanked. Poppy Bush was seen as out of touch and voters sent him to an early retirement. Now his son is trying to figure out how to avoid a similar fate."

Bush's Economic Summit Ignores the Growing Divisions between Rich CEO's and Unemployed Americans
Economic Policy

AFL-CIO president John J. Sweeney writes, "As CEO pay soars, major corporations routinely lay off workers, cut health and retirement benefits, slash pay and shut down American plants altogether and start up abroad -- all to impress the stock market. Now unemployment stands at 5.9%, compared with 4.6% in July of 2001. Altogether, 9.8 million people want to work but cannot find jobs -- and 1.5 million have been unemployed for at least six months. Manufacturing -- a sector of the economy on which working people depend for well-paid, steady jobs -- has been decimated. Manufacturing employment is down 2 million since April 1998, and down by almost 1 million in the past 12 months alone. As working men and women struggle to pay the bills, the top 1% of taxpayers stand to reap nearly a half-trillion dollars in tax breaks during the decade as a result of last year's tax changes championed by the Bush administration. These are the 'economic fundamentals' that families face."

GOP Attacks on 'Automatic Stabilizers' Will Make Current Recession Deeper
Economic Policy

Jeff Madrick writes that economist Hyman Minsky believed "government itself is a necessary bulwark against recession. In particular, so-called automatic stabilizers are ideal tools for the job... Automatic stabilizers are programs like unemployment insurance and welfare that increase during economic downturns but recede in good times. As more people are unemployed, for example, the government disburses more, helping to maintain demand in a declining economy. More sign up for welfare as well, helping to place a floor under the economy. What makes them especially useful is that when the economy strengthens again, the automatic stabilizer programs are reduced as, for example, unemployment declines." Of course, Republicans slashed all the stabilizer programs, which will deepen the current recession. Defeat all Republicans!

It's Still the Economy, Stupid
Economic Policy

James Ridgeway writes, "Treasury Secretary Paul O'Neill's dotty performance Sunday on Meet the Press signals just how vicious Bush can be when he puts his buddies out to dry. O'Neill's insistence that the fundamentals of the economy are great is buttressed by the administration's deliberately twisted facts, such as: Bush projects that the stock market will rise this year, when it already has tanked. When Bush came to power, the Dow Jones industrial average stood at 10,600. Last Monday it fell below 8000. According to the Standard & Poor's Index of 500 stocks, Bush's first year and a half has been the worst ever recorded. Bush claims that tax cuts aren't responsible for the vanishing surplus, when in fact they contributed 38 percent. O'Neill says the fundamentals are good, but for younger workers unemployment rose last month to 12.2 percent from 11.6 percent. For blacks it stands at 10.7 percent." Want a job? Vote Democratic!

Bush's Economic Team Is Tone-Deaf And Brain Dead
Economic Policy

Jim Hoagland writes, "The dysfunctionality of the Bush administration's economic policy team paraded into public view long before a plunging stock market slammed the point home this summer. Billions of investor dollars later, it is time for a change. Bush has stocked his Cabinet with officials with tin ears. They cannot hear what markets, the media and even their own advisers try to tell them. This is particularly true of the non-team that Bush has non-managing the financial free-fall caused by the bursting of the stock bubble and a tsunami-like wave of corporate corruption." Fire Paul O'Neill now!

To Prevent Economic Collapse, Bush Must Fire Paul O'Neill - and Karl Rove
Economic Policy

The New Republic writes, "It is by now painfully clear that the only constant in George W Bush's economic agenda is that it is determined almost entirely by politics. Last summer the White House sold a tax cut that would mainly take effect years down the road as a short-term stimulus. Since then it has repeatedly abandoned the free-market principles it claims to cherish, courting Rust Belt voters with steel tariffs and lavishing farm subsidies on Midwestern swing states. The pattern hasn't gone unnoticed. When asked last month to account for the dollar's recent decline, [economist David Hale said] 'The world fears that Karl Rove now controls U.S. international economic policy'... Karl Rove may soon learn the one political lesson he hasn't yet assimilated: In the end, bad economics is bad politics. Unfortunately, the United States may have to learn it along with him."

Whenever Bush Speaks, the Market Goes South
Economic Policy

"Bush tried to calm investors' fears today by predicting that new restrictions on corporate accounting will buoy stock prices...Bush echoed many investors' sense of helplessness when he said he is 'the wrong guy' to talk to about what stocks to buy...White House officials had adopted a policy, similar to one followed by President Bill Clinton and his aides, of talking up the fundamentals of the economy -- including the growth, unemployment and inflation rates -- while avoiding comments about daily market turns...House Minority Leader Richard A. Gephardt (D-Mo.), however, said in Miami Beach that the stock market dipped the last three times Bush has addressed economic matters." Bush "'continues to speak -- that isn't helping us,' he said. 'In fact, it may be hurting us because what people want is action, not words.'"

Are Bush and his Corporate Cronies about to Trigger a Global Financial Collapse? Stay Tuned
Economic Policy

David Callaway of CBS.MarketWatch.com writes: "The groundwork for a mass panic in the market later this summer or early this fall is already being laid... Such a disaster will take us well beyond the bursting of the telecom, energy and Internet bubbles and into the realm of a systemic threat to the world's financial system... I wrote seven months ago that the Enron scandal would be President [sic] Bush's Whitewater, and worse, arguing that it would expose in a series of bombshells how the Texas business elite work together to secretly rig the game... to increase their own power and profits. But while the Whitewater scandal was never more than a sideshow for the Clinton team, the corporate calamity and ensuring plunge in confidence that has resulted from the Enron scandal is now the major issue of the Bush presidency [sic], overshadowing even the war on terrorism and threatening the Republican's grip on the House in November."

Bush's Economic Incompetence Sets The Stage For An Economic Perfect Storm - a Depression
Economic Policy

Robert Kuttner asks, "Could there be an economic perfect storm brewing? Consider the elements. When Enron imploded, defenders of unregulated capitalism rushed to condemn it... This is how capitalism works. Eventually the market cleans up its act because investors demand it. [However,] the cleanup invariably involves government intervention, not market self-correction. It was, of course, deregulation that invited this mess. Here is the potential perfect storm: [1] Investor panic. If corporate reporting of profits cannot be trusted, investors flee. [2] The Dollar... The flow of foreign capital to the United States has begun slowing, and the dollar has begun falling. [3] Inflation and Recession... If the dollar decline worsens, the Fed will have to raise rates. Higher rates would slow economic growth. They would also drive investors from stocks into bonds, which would accelerate the stock market decline... Hence the perfect storm: recession, inflation, and a plunging stock market."

George Soros Says the World Financial System is Collapsing as a Result of the 'Bush Factor'
Economic Policy

"Billionaire investor George Soros on Thursday blamed President [sic] Bush and his team for the fall in the U.S. dollar and declared: 'The international financial system is coming apart at the seams. I think we're in fairly serious trouble. I do think we're in a crisis situation,' said the Hungarian-born hedge fund king-turned-philanthropist in a speech to the London Business School on Thursday evening. 'We have the Latin American crisis and we have the declining U.S. dollar, which means that the motor of the global economy is basically switched off,' said Soros. 'There is a lack of confidence. That's what I call the 'Bush factor' in the economy... What worries me is that there doesn't seem to be any great desire on part of the authorities to do much. There is still a belief, particularly in the United States, that the financial markets will correct themselves. But markets cannot be left on their own. You need to correct them,' said Soros."

Memo to Democrats: It's Corrupt Capitalism, Stupid
Economic Policy

"The pattern here should be politically explosive. A firm's stock price is supposed to go up when it has produced something people want, not because its accounts are fraudulent... Put this together with other corporate scams, and you've got a campaign message. Companies are fleeing to offshore havens, forcing you to pay more tax. They lobby for useless weapons, farm subsidies and other corporate welfare, so that your tax dollars get wasted. And look at Enron and Adelphia and those pharmaceutical firms: They are wrecking your retirement funds with accounting tricks, jeopardizing your job security by siphoning cash out of your firm and bankrupting your grandma with sky-high drug prices. Forget the dumb attacks on globalization and free markets. The real injustice is that firms are rewarded for lies and lobbying clout, rather than for producing honest goods and services. The scandal isn't capitalism, in other words. It's that capitalism has been corrupted." So writes Sebastian Mallaby.

Bush is THE Problem in the Corporate Corruption Wall Street Meltdown
Economic Policy

Arianna Huffington writes, "Unlike other eras of corporate corruption, our own hasn't spawned much of a political movement for reform. We can't expect the Bush administration to act -- Bush, Cheney Inc. is a wholly owned subsidiary of corporate America, and President [sic] Bush likes to be known as 'the MBA president.' While his do-nothing anti-regulation approach to business might have gotten him more criticism when Enron imploded in scandal, he was able to use the Sept. 11 attacks and the war on terror to hide from blame. On Thursday Bush acted belatedly to reorganize his messed-up homeland security apparatus; don't hold your breath to see him take on the SEC and other agencies that are botching their regulatory responsibilities."

Chinese Curses and Republican Economic Morality
Economic Policy

Writes Kent Southard: "Used to be we were told that one of the most important central moral principles that elevated the American system above its communist competition was that under communism everyone was paid the same no matter how hard an individual worked while in America an individual was rewarded according to his effort. For most Americans, this no longer seems true. Under this new administration, there's an increasingly nagging sense that workers are little more than economic cannon-fodder to be used up cheap and thrown away in a corporate system and war we barely see the outlines of."

National Review Admits Dems are Better for the Economy
Economic Policy

The U.S. has had recessions and rising unemployment in four of the last five midterm election years in which a Republican was in the White House: 1970, 1974, 1982, and 1990. '86 was weak in comparison to that decade. The Democrats, by contrast, did well for America. Their midterm years — 1962, 1966, 1978, 1994, and 1998 — all had strong economic growth and declining unemployment. This is a consistent historical trend. Time and again Democrats hand a thriving economy over to Republicans, who then wreck it by allowing unchecked theft, greed, and criminality. And once again the current Enron Administration proves this true. Although the cited article in the National Review tries to make a lot of excuses for this, it is clear that Democrats are good for business, and Republicans suck for business. And for working Americans the equation is simple: Republican President = Poverty; Democratic President = Prosperity.

Bush's Policies Are a Dismal Failure for America's Working Families, but a Boon to the Richest 1%
Economic Policy

Democratic principles of improving the living standards of all Americans are being threatened, according to evidence developed by Russell Mokhiber and Robert Weissman. With 43 million (mainly working) Americans unable to afford health insurance, the super-elite are enjoying "boutique" and "concierge" health care, complete with massages, saunas, and expedited services. Federal revenues will plummet as corporate taxes will account for only 1.3% of the gross domestic product (GDP), while more than half of last year's tax cuts will go to the wealthiest 1% of US taxpayers. Meanwhile, one-quarter of the US population earns poverty-level wages, and 1 American child in 6 lives in poverty. While the Bush administration eliminates services through defunding, our US Constitution's preamble reads: "…to promote the general welfare…" Time to take back the Congress and put people before profits!

Chamber of Commerce Champions 'Crony Capitalism'
Economic Policy

The Washington Post writes, "This is why the bill crafted by Sen. Paul Sarbanes (D-Md.) is so important. Unlike the sham alternative backed by Sens. Phil Gramm (R-Tex.) and Michael Enzi (R-Wyo.), the Sarbanes bill offers most of what is needed to make corporate numbers meaningful. It guarantees the financial independence of the accounting standards board, thus shielding it from moneyed lobbies. It creates a new regulatory board to watch over auditors, one that would be genuinely independent of the profession. It goes partway toward curbing auditors' conflicts of interest by banning some types of consulting. It tries to bolster corporate boards. Now, precisely because Mr. Sarbanes has proposed tough legislation, the accounting lobby is pounding him... Lobbies such as the Chamber of Commerce appear to have lost sight of this, promoting cronyism in place of capitalism. Those who care about the public interest have a duty to fight back."

Scooby Dooby Doo, Harvey Pitt, Where Are You?
Economic Policy

Arianna Huffington writes, "You know things have really gotten out of hand when the most scathing attacks on corporate greed and Wall Street malfeasance are being launched not by knee-jerk business haters and anti-globalization Jeremiahs but from the glittering towers of corporate America... Warren Buffett, the Grand Pooh-bah of American Capitalism, opened fire with both barrels this month when he told an audience of over 10,000 Berkshire Hathaway shareholders that Wall Street loves a crook, investment bankers don't care about investors, stock-option-engorged CEOs are shameless, and American business is teeming with fraud... With big business in such a sorry state, what we need more than ever is a courageous crusader at the helm of the [SEC]. Instead, we have Harvey Pitt... Talking to Pitt about corporate greed is a lot like talking to Cardinal Law about pedophile priests. It's crystal clear that these guys just don't get it."

Neo-Con Ideology Loses It's Shine
Economic Policy

Richard Gwyn writes that the Neo-Con mantra that the Market is Self -Regulating "has dominated our economic system for about two decades... From it flows our principal contemporary economic policies, from tax cuts to deregulation to privatization to free trade to minimal government... The market does have important self-regulating characteristics. [But what] is hokum is the notion believed in by neo-conservatives (with the same absolutist fervour that Marxists once espoused their nostrums) that the market is inherently self-regulating. To paraphrase the well-known dictum about democracy: The market is self-regulating for some people all of the time and for all of the people some of the time, but not for all of the people all of the time. This is the message that has been sent out loud and clear by the current outpouring of corporate scandals. [The neo-cons philosophy has] been exposed, essentially, as regulation by crony capitalists."

As W-ar Costs Surpass $12 Billion, White House Admits 'You've Got to Have a Roaring Economy'
Economic Policy

After giving America's hard-earned surplus to the rich, and tapping into Social Security and Medicare reserves, White House officials are now mounting a re-election [sic] campaign initiative designed to scrim over their fiscal mismanagement and insure that Bush#43 doesn't appear to repeat the economic mistakes of his father, Bush#41. Fearing that rising gas prices (March's was the sharpest 4-week increase since 1990) could diminish public optimism about economic recovery, Bush strategists are busily implementing a public relations offensive. Plans cover using the poor economy for legislative leverage to promote Mr. Bush's agenda, such as increased energy production, including oil and gas drilling in the Arctic National Wildlife Refuge. While Mr. Bush defers optimism, aides are cautiously optimistic about economic recovery. As one candidly put it, "You've got to have a roaring economy to create the kind of revenue you need to fight wars."

Business Press is Outraged by the GOP's Russian-Style Crony Capitalism
Economic Policy

NY Times columnist Paul Krugman writes, "Even I was startled by the tone of the Jan. 21 issue of Investment News, which describes itself as 'the weekly newspaper for financial advisers.' The headline was 'Paul O'Neill's Sweet Deal'; the blurb was 'IRS backs off closing loophole, averting tax liability for execs and Treasury chief...' Two weeks later I learned from The Wall Street Journal that this loophole is more than a tax break for businessmen: it's a gift to biznesmen... Confused? In the former Soviet Union, the term 'biznesmen' (pronounced 'beeznessmen') refers to the class of sudden new rich who emerged after the fall of Communism - and who generally got rich by using their connections to strip away the assets of public enterprises. What we've learned from Enron and other players to be named later is that America has its own biznesmen - and that we need to watch out for policies that make it easier for them to ply their trade."

Enronomics For Dummies
Economic Policy

Washington Post columnist Richard Cohen writes, "The principle that the government can and should run a deficit to stimulate a sick economy was first propounded by John Maynard Keynes. This is called Keynesian Economics. The principle that the government can and should run a deficit when it does not have to was developed by George W. Bush. This is called Enronian Economics. It should not be surprising that Enronian Economics has taken over Washington. Both the Texas-based firm and the Texas-based president have so much in common. For one thing, the president was once a friend of Enron's former chairman, Ken Lay. He called him Kenny Boy, but since the collapse of the firm, he doesn't call him at all. But more than that personal connection between the two was -- and remains -- a shared business philosophy. Bush recently expounded the doctrine that a tax cut postponed is the same as a tax hike. In other words, a bird in the bush is worth two in the hand, or something like that."

Paul Krugman on Alternative Realities, Lump-Sum Transfers, Enron and Teapot Dome
Economic Policy

"From an economist's point of view, the most revealing indicator of what's really happening is the post- Sept. 11 fondness of politicians for 'lump-sum transfers.' That's economese for payments that aren't contingent on the recipient's actions, and which therefore give no incentive for changed behavior...It's bad if the alleged purpose of the transfer is to get the recipient to do something useful, like invest or hire more workers...Current events bear an almost eerie resemblance to the period just after World War I. John Ashcroft is re-enacting the Palmer raids, which swept up thousands of immigrants suspected of radicalism; the vast majority turned out to be innocent of any wrongdoing, and some turned out to be U.S. citizens. Executives at Enron seem to have been channeling the spirit of Charles Ponzi. And the push to open public lands to private exploitation sounds like Teapot Dome."

Bush v. Economy: The Bush Recession Began in March
Economic Policy

It's official: the Clinton-Gore Expansion ended in March, and was replaced by the Bush Recession. The Clinton-Gore expansion lasted 10 years, breaking the previous Kennedy-Johnson record of nearly 9 years. George W. Bush, like Ronald Reagan and George H.W. Bush, believes that "trickle-down" economics is the solution to recession, while Democrats believe in "trickle-up." That's why Democratic economic policies work, while Republican policies fail.

Conason: Republican 'Stimulus Plan' Amounts to Looting the Treasury
Economic Policy

With greed now masquerading as patriotism, our country's ruling elite resembles the larcenous oligarchies that comprise the core of America's allies worldwide, writes Joe Conason.

Bush v. Economy: Unemployment Rate Soars to 5.4%
Economic Policy

"The nation's unemployment rate soared to 5.4 percent in October, the biggest one-month jump in more than 21 years, providing the most dramatic evidence yet that economic fallout from the terror attacks probably pushed the country into recession. A massive 415,000 jobs were eliminated during the month. Widespread job losses catapulted the unemployment rate from 4.9 percent in September to 5.4 percent last month, marking the highest unemployment rate the country has seen since December 1996, the Labor Department reported Friday. The 415,000 jobs eliminated during the month represented the biggest cut in payrolls since May 1980. Manufacturing, airlines, travel agencies, hotels, retailers were among those posting big losses." The solution is not tax giveaways to big corporations - it's generous unemployment benefits and tax refunds to the poor.

Progressive Democrats Seek $62 Billion for Unemployment Insurance
Economic Policy

There will be an unusual meeting of the House Democratic Caucus at the end of the day Thursday. The meeting itself was forced by a little-used petition supported by a large number of Democratic Members. At the meeting, Representatives Kucinich, Lee, Owens, McKinney, DeFazio, and other members of the Progressive Caucus will offer a motion to expand Unemployment Insurance in any economic stimulus package announced by the House Democratic Caucus. If this meeting had not been called, the Democratic leadership would have announced an economic stimulus package on Thursday with a smaller unemployment benefit increase. Call your Democratic Representative today!

Airline Bailouts Expose Weakness of 'Free Market Fundamentalism'
Economic Policy

"The terrorist acts perpetrated in the name of Islam have scored an impressive 'theological' achievement: Western governments set out to rescue faltering airlines and in doing so disavowed their secular religion - 'the religion of privatization.' The government of Switzerland bailed out Swissair; the government of New Zealand did the unimaginable and nationalized New Zealand Air; and even the government of the United States pumped funds into various American airlines... In the past, Western governments had the shapers of Keynesian economic theory to help them overcome the Great Depression. Nowadays, governments capitulate to 'theologians' - the high priests of the free market and privatization... the West needs another Keynes, who will extricate the economy from its subordination to 'force majeure' and return it to human control." So writes Ephraim Reimer in Ha'aretz.

Where is Robert Rubin When We Need Him?
Economic Policy

Time Magazine writes, "After Sept. 11, when the financial world turned apocalyptic, [Treasury Secretary Paul] O'Neill's only public comments were mindless cheerleading about the strength of the economy, the lack of an imminent recession, and some very bad advice: 'The people who bought today are going to be happy people,' he said on opening Monday. 'The people who sold will be sorry they did it.' The Dow lost another 700-odd points that week, and hasn't exactly sprung back since." O'Neill has been a dismal failure - can't Bush find anyone like Robert Rubin?

Conservatism Loses its Compassion in the Face of Recession
Economic Policy

Bailing out the airline companies is an urgent national priority, according to Republican Congressional leaders. But House Republicans are unwilling to even consider extending unemployment compensation and health care benefits to the workers laid off by those companies. So the first moment that compassion and conservatism come into conflict guess which one prevails?

Progressive Majority Calls for Responsible Economic Stimulus, Not Big Business Giveaways
Economic Policy

Bob Borosoge of the Campaign for America's Future and the Progressive Majority Network has begun the campaign to unmask the Republican economic agenda. Once again they're pulling out tax cuts for wealthy investors as a response to the urgent need to reverse a shrinking economy, when that will provide little economic stimulus. By rediscovering and articulating the interests of working Americans and crafting economic policy to focus on their needs and interests the Democrats can make their greatest contribution to economic recovery and national unity.

Thanks to Bush, Economy Teeters on Recession
Economic Policy

"Economic growth nearly halted in the second quarter, as businesses made severe cuts in investment and consumer spending grew less quickly than it had at the start of the year, the government said today. The economy is now in its weakest condition since early 1993... The economy grew at an inflation- adjusted annual rate of 0.7 percent in the three months that ended on June 30... [Bush said] the tax cut he championed would provide 'an incredibly important boost to economic vitality and economic growth.'" Sure thing, George - we're getting ready for the Bush Recession.

Report on Financial Prospects of Clean Technologies Proves US Is Being Dragged Backward by Bush
Economic Policy

What's that sorry argument Shrubmeister uses as his blanket excuse for anything pro-environmental and as a way to push his energy plan? Ah, yes! - it would all be "bad for the economy." Well, truth is, it's Shrub's energy and environmental plans that will be disastrous for our economy in the near future, if they are enacted. Though he is pushing us toward a global economy, he is at the same time trying to block all efforts to develop the products and infrastructure required to compete in that global economy. In the "parking lot of life," the US will soon be the oil-leaking, fume belching rattletrap parked off to the side with the hopeless "For Sale" sign stuck to its cracked windshield. Here is as prospectus for clean technologies. Don't read it and weep - read it and then invest!

Alan Greenspan Would Abolish the Minimum Wage
Economic Policy

Federal Reserve watchers - including conservative Wall Street types - think Alan Greenspan raised interest rates too much in 2000, which clobbered the stock market and ended the Clinton-Gore economic boom. Many Democrats believe this was done to weaken the economy and to hurt Gore's chances. Now we learn that Greenspan supports one of the cruelest goals of the Republican right - the abolition of the minimum wage. It's a crime that Bernie Sanders only got a couple of minutes to challenge the Wizard of Fed, who never has to face the people whose lives he significantly controls.

Bush Cuts Small Business Assistance to Favor Big Business
Economic Policy

According to Fred P. Hochberg, former head of the Small Business Administration, Bush's "budget slashes funding for the Small Business Administration by 40 percent. Small start-up companies, full of energy and ideas, would lose crucial support... Today, as growth begins to slow, President Bush is proposing to cut this economic engine. Even as big corporations have begun to make big layoffs, the Bush budget would cripple a small agency that can help pick up the slack. The nation's 25 million small businesses, which employ more than half of the private work force, have been responsible for more than three-quarters of the 22 million jobs created in America since 1992."

Republicans and Dr. Strangelove: Or learning to Cut Taxes and Love the Deficit
Economic Policy

It has taken the Democrats forever to catch on to what has happened to the political debate in this country. The Republicans have learned to cut taxes and love the deficit. Deficits cause inflation, and inflation amounts to a consumption tax, which is hardest on people who consume all of their income, especially the working poor. Inflation effectively gives many conservatives the tax they consider the most fair, a national sales tax. A consumption tax in effect gives the rich a pass on paying taxes earnings from business investments, stocks and bonds.

Bush Hides in Luxury While Quebec City Burns
Economic Policy

"On the streets of this 400-year-old city, the protesters railed against the potential human costs of political and commercial globalization. In a luxury hotel behind old stone walls and modern chain-link fencing, Bush pushed his agenda of hemispheric cooperation during brief meetings wityh groups of colleagues from Central America and the Andean nations."

Bush Speaks and Market Tanks
Economic Policy

In response to Democratic complaints that Bush was "talking down" the economy to get his tax cut passed, Bush declared that he is an optimist. But Bush has so little credibility on Wall Street that the Dow dropped 238 points to 9,720.76, its lowest level in 2 years. We have nothing to fear but Bush himself.

Bush's Bias Toward Industrial Dinosaurs Is Strangling America's High-Tech-Driven Growth
Economic Policy

"The shift of stock-market dollars away from the infotainment companies toward lethargic firms born in the 19th century threatens to destroy whatever savings [small investors] may have expected to receive through income tax reductions. While a tax cut might plausibly stimulate more spending on refrigerators and TVs by the imaginary "typical" four-person family with $75,000 in income, this family's stock market losses and slower long-term economic growth more than offset this stimulus." So write Herman Schwartz and Aida Hozic in Salon.

Would You Buy a Used Economy from This Man?
Economic Policy

"Initially, Bush wanted the bad economy to be associated with the Clinton era and was framing it as worse than it was, and now he is framing things as being worse than they are in order to promote his tax cut to create support and rationale for his tax cut. It was disingenuous, and a really bad move. Because he's drumming up a pessimism about the economy that's a self-fulfilling prophecy." So says Peter Leyden, co-author of "The Long Boom: A Vision for the Coming Age of Prosperity."

Democrats Pound Bush on Economy
Economic Policy

Congressional Democrats accused Shrub of "talking down" the U.S. economy and causing the stock market to tank just so he could argue his $1.6 trillion tax cut was needed to stimulate the economy. "They're doing it for the short-term political gain of passing a tax cut we can't afford and don't need. They're doing it in a way that I think is very, very harmful to the economy," said Tom Daschle (D-SD).

PapaBush, BabyBush, and the Haitian Future of the U.S.
Economic Policy

When the U.S. looks overseas for lessons, we look to Europe or Japan. But the lessons of Haiti are far more important - such as the importance of protecting the environment and paying livable wages. Is BabyBush really another BabyDoc?

When G. W. Bush Speaks, Wall Street Crashes
Economic Policy

Remember the old brokerage house commercial, "When E.F. Hutton speaks, people listen?" When G.W. speaks, Wall Street crashes. "No wonder world markets are shaky. The epicenter of the global expansion is being led by George. If the economy is fueled by confidence and trust, as well as fear and greed, there is deep trouble. Fear is the absence of confidence and trust—fear chokes vitality—and what grows with interest daily is a vote of no confidence for George — and that is a vote that no one and nothing will be able to block." So writes Bill C. Davis in the Online Journal.

As Stock Market Crashes, Bush Unveils Faith-Based Economics
Economic Policy

Forget John Maynard Keynes and Milton Friedman. The economist who will revive America's sagging economy is - well, who exactly? "I'm concerned that a lot of Americans' portfolios have been affected," Bush told reporters as hard-hit investors looked out their windows to pavements far below. He then added, "I've got great faith in our economy." In response, the Dow sank 374.07 points to 9,916.73. Pretty soon Shrub will have to revive his dad's economic stimulus plan - going to the mall to buy another pair of socks. After all, it's been 10 years. When that happens - sell!!

Economic Policy

Less than two months after stealing his way in to the White House, Bush turned the stock market into the first bear market since 1987. The bear market is defined as a 20% drop in the market. It remains unclear whether the economy is officially in recession. But it's clear that the $5.6 trillion surplus projection - the basis for the $2 trillion tax cut - has just been obliterated. How long will it take for Congress to catch up with reality, revise its projections and cancel the tax cut? Don't hold your breath.

A Mirage Bush Inc Calls a 'Surplus'
Economic Policy

The Dot Com world has evaporated, the bubble is burst, the mirage enabled by that overheated atmosphere has vanished. And with it $3 trillion in "value" has also vanished in a just 12 months. As Tom Redburn writes in the NY Times, the tax payments created by this $3 trillion bubble are what created the mirage that Bush is now trying to sell us as "surplus". Now that the bubble has burst, those tax receipts will very likely be drastically lower. Can you say good-bye mirage and hello deficit?

Clinton's Parting Gift: A $5.6 TRILLION Projected SURPLUS
Economic Policy

Why are the Republicans still attacking Bill Clinton with such venom? Because they don't want the American people to realize that he left office with a projected SURPLUS of $5.6 TRILLION!!! The previous Reagan-Bush administrations ran up $4 TRILLION in DEBT, which is costing Americans over $300 billion in interest payments each year. Now Republicans want to return to "Voodoo Economics" and "Borrow and Spend."

It's the Economy, Stupid (Don't Wreck It)
Economic Policy

Why did Alan Greenspan endorse a tax cut? Bush's economic plan is a disaster.