Talking Down the Economy
By James D. Agresti
October 14, 2008
There are numerous factors that impact the U.S. economy, but one has been singled out by economists, media titans and leading politicians as a pervasive underlying force: The public mindset. This key dynamic is significantly influenced by people and institutions who have the public's ear. Though rarely discussed in the current news frenzy surrounding the economy, recent history sheds a great deal of light on the matter.
In early 2001 as Bill Clinton left and George Bush entered the Oval Office, GDP growth had sunk into negative territory,[1] the dot.com bubble had burst sending the stock market in a downward spiral,[2] [3] [4] and Treasury Department profit estimates for nonfinancial corporations, which were previously reported as growing for the past two years, were later found to be off by as much as 29.9% and had been in rapid decline.[5] [6] [7]
Not wanting to be blamed for economic
conditions that preexisted any policies
implemented by his administration, Bush and
other members of his team brought attention
to problems that beset the economy.[8] This was
greeted by a backlash from Democratic
leaders and prominent media outlets, who
objected that Bush was "talking down the
economy" and that this would erode public
confidence and trigger economic troubles.
Making the case that Bush's "talk" was
damaging the economy, an article in the Washington Post flatly stated that
economic indicators "deteriorated
considerably" following "a drumbeat of
ominous forecasts by the Bush
administration."
[9] In fact, it was later found
that GDP growth had sunk into negative
territory several months before Bush took
office.[10] Another article in the Post
quoted an economist who asserted, "What
happened is that a few politicians opened
their mouths and started to use the R-word
[recession]. And then newspapers started to
run big headlines about layoffs."
[11]
In a house editorial, the New York Times
lectured "it is important" that President
Bush "quit talking down the economy…."
[12] Likewise, a column in the Times took
Bush to task for not being a "cheerleader"
for the nation's economy.[13]
An article in Time magazine critiqued
President Bush and the media for being
pessimistic about the economy and pointedly
declared, "The worry factor is not to be
underplayed. Recessions and bear markets are
as much about psychology as fundamentals…."
[14]
In a Chicago Tribune editorial penned
by one of their senior writers, it was
stated that "public perception fuels the
nation's fiscal health," "the mind of the
consumer is the most important commodity in
the economy," and we will "never know for
sure how much" Bush's statements have
"directly contributed to the decline in
confidence."
[15]
Likewise, an Associated Press news
analysis faulted the Bush administration for
talking negatively about the economy,
asserting "there is no evidence that
economic growth has actually turned
negative," and quoting an economist who
analogized Bush's remarks on the economy to
a basketball coach who tells his team that
their last coach was "lousy" and "you're a
rotten team."
[16]
All of the above was made in concert with
similar assertions by Democratic politicians
and their economists. In March 2001, the
lead Democrats in the Senate and House of
Representatives held a joint press
conference proclaiming that the "Bush
administration has been talking down the
economy now for some time" and "what we're
seeing is a talking down of the economy."
[17]
[18]
[19]
In the midst of all this, Bush's concern
that he would be blamed for economic
conditions he had inherited became a
reality. Less than two months after he took
office,[20]
[21] an article was published in the New York Times with the headline, "60
Percent Favor Bush, but Economy Is Major
Concern." In it, it was reported that "some
Democrats are pointing fingers at Mr. Bush"
and quoted a financial analyst as stating,
"Everything just seems to be going in the
wrong direction now; there are so many job
cuts. People I know are losing their jobs.
This didn't happen during the Clinton
administration."
[22]
Less than two months later in May 2001, the
same press outlets that had recently warned
about the dangers of "talking down the
economy" were doing exactly that. Within the
space of only two articles published on the
same day in the New York Times and Washington Post, the following verbiage
was used in reference to the nation's
economic health:
"already sluggish," "weakness," "weakening,"
"weakened," "has been weakening," "even
weaker," "even more economic weakness," "big
job losses," "job-cutting," "rising
unemployment," "shrinking profits," "job
cuts," "jump in unemployment," "recession
fear," "job loss," "dashing hopes,"
"continuing corporate layoffs," "hiring
freezes," "pull back sharply on their
spending," "rising unemployment," "dampen
consumer spending," "pace of layoffs shows
no sign of abating," "falloff in hiring has
been so steep and so sudden," "most
forecasters expect the jobless rate to
rise," "layoffs renew recession fear,"
"tipping the economy into recession," "might
be nearing, or even in, a recession."
[23]
[24]
At the time these stories were published,
Bush had been in office for less than four
months and Congress had yet to pass his
first major economic proposal.[25] Furthermore,
the first federal budget of Bush's tenure
was still five months away from being
implemented.[26]
Since then, pessimistic characterizations of
the economy by the press and Democratic
politicians have continued unrestrained,
even in the face of robust economic
indicators to the contrary. Since most
people do not have the experience or context
to interpret economic statistics, they are
often left with little more than the spin
that press outlets place upon these figures.
Flagrant double standards have been employed by the
media in this regard, usually rising to a
peak during Presidential election years.
Media watchdog organizations and
commentators have documented obvious
patterns in such cases. For example:
• During the quarter preceding Bill
Clinton's victory over George H. Bush's bid
for a second term in the election of 1992,
97% of economic portrayals on the big three
television evening newscasts were negative.
Yet, this changed immediately and
drastically once the election was over, and
more than 60% of economic portrayals for the
remaining two months of the year were
positive. (Center for Media and Public
Affairs.)[27]
• Three key economic indices for the year
that preceded Bill Clinton's re-election in
1996 and George W. Bush's re-election in
2004 were as follows:
| 1996 | 2004 | |
| GDP growth | 4.0% | 3.2% |
| Unemployment | 5.5% | 5.6% |
| Inflation (CPI) | 3.0% | 2.5% |
Despite the fundamental similarities between
these figures, there was a distinct contrast
in media portrayals of the economy. For
example, in 1996 when Clinton was up for
reelection, Adam Nagourney of the New
York Times wrote, "the economy is good."
[31] Yet, as noted by columnist Jack Kelly, when
Bush was up for reelection in 2004, Nagourney declared the economy was
"faltering."
[32] Numerous examples of such
biased reporting on the economy have been
documented by right-leaning commentators and
organizations such as the Media Research
Center.[33]
[34]
[35]
[36]
[37]
Perhaps the most concrete indicator of
slanted economic reporting on a widespread
level is public opinion polls that show a
major disconnect between perception and
reality. As pointed out by libertarian
commentator Larry Elder, a November 2005
poll found 43% of Americans believed the
country was in a recession.[38]
[39] Yet, the year
leading up to this poll showed analogous GDP
growth, unemployment and inflation to the
year that led up to Clinton's reelection in
1996.[40]
[41]
[42]
With another presidential election upon us
and a Republican in the White House,
negatively skewed economic reporting is
climaxing, and in concurrence with this,
economic conditions are worsening. For
example, little more than a month ago on
August 28th, GDP growth for the previous
quarter was revised from 1.9% to 3.3% (which
happens to be
precisely the average of the past 25 years
and 3.8 points higher than when Bill Clinton
left office).[43]
Yet a snapshot of the New York Times
home page taken five hours after they
published this news item displays a pattern
consistent with media reporting in previous
elections. The positive economic development
was placed in an obscure location and given
a nondescript headline. Had this article
been placed prominently with an informative
caption, it would have undermined the story
that was given the lead position.[44]
In marked contrast, earlier in the same month when the initial (and lower) GDP figure was reported, it was made the lead headline and presented with a caption that read, "Economists construed the disappointing quarter as clear indication that the economy remains snagged in the weeds of a widening downturn." [45] The article itself also failed to mention that "the first release of many economic indicators," as explained in a text published by the Wharton School, "contains pieces of data that are far from reliable and thus considered preliminary." [46] [47]
Likewise, a few days later in the buildup to
the current financial crisis, Yahoo News
placed the following Associated Press
headline and caption at the top of their
news features:
Jobless rate jumps
to 5-year high of 6.1 percent (AP)
AP - The nation's unemployment rate zoomed
to a five-year high of 6.1 percent in August
as employers slashed 84,000 jobs, dramatic
proof of the mounting damage a deeply
troubled economy is inflicting on workers
and businesses alike.[48]
Increasing unemployment is a clear negative
development, but a rate of 6.1% is not far
off from the annual average of the past 25
years (5.8%).[49] This is not to deny the nation
is in troubled economic times, but given
what the press and politicians affirmed about
"talking down the economy" less than 8 years
ago, there can be little doubt that they
have played and are playing a major role in
damaging it now.
Sidebar: Economic Fallacies and Realities
With the media's linkage of
political fortunes to economic
statistics, several misconceptions
have gained ground in the public
mind. The first is the notion that
the credit and blame for general
economic conditions can be
rationally attributed to the
President.
The reach of the federal government
in the U.S. economy is pervasive,
and over time it has acquired
expansive powers that impact
economic conditions.[50] However, the
federal government consumes about
18% of the nation's GDP,[51] leaving the
vast majority of economic activity
in the hands of the American people.[52]
Thus, the statement in the Chicago
Tribune that "the mind of the
consumer is the most important
commodity in the economy."
Furthermore, while the executive
branch of the federal government has
broad powers that can influence the
economy, the Constitution vests
legislative and taxing authority in
the hands of Congress.[53]
[54] On top of
this, roughly two-thirds of all
federal expenditures are entitlement
programs like Social Security and
Medicare in which finances are
primarily controlled by laws made by
previous Congresses and Presidents.[55]
There are more than 60 parameters
that economists, journalists and
politicians analyze and slice in
making economic assessments and
portrayals.[56] Therefore, it is almost
always possible for partisans to
find bad news in a sea of good and
vice versa. However, three of the
most cited and regarded economic
indicators are GDP growth,[57]
[58]
unemployment,[59] and inflation (CPI).[60]
[61]
[62]
These are graphed below for the past
25 years along with a record of the
parties controlling Congress and
President.[63]
[1] Table 1.1.1: "Percent Change From Preceding Period in Real Gross Domestic Product." Bureau of Economic Analysis, U.S. Department of Commerce. Downloaded 10/3/2008, Last revised September 26, 2008. Line 1. http://bea.gov/national/nipaweb/TableView.asp?SelectedTable=…
2001, 1st quarter: -0.5%
[2] Transcript: "Inside
the Dot.Com Crash." CNN Moneyline,
December 26, 2000.
http://transcripts.cnn.com/TRANSCRIPTS/0012/26/se.01.html
One year ago at this time, Internet stocks
were in the midst of an astonishing rally,
and their future seemed limitless. But since
then, investors have been facing a brutal
reality check, watching their shares fall
70, 80, 90 percent from their highs and in
some cases disappear completely.
[3] Web page: "Dow Jones
Wilshire Broad Market Indexes." Accessed
October 10, 2008 at
http://www.wilshire.com/Indexes/Broad/
The Dow Jones Wilshire 5000 Total Market
Index represents the broadest index for the
U.S. equity market, measuring the
performance of all U.S. equity securities
with readily available price data. No other
index comes close to offering its
comprehensiveness.
[4] Web page: "Dow Jones
Wilshire 5000 Composite Index." Accessed
October 9, 2008 at
http://www.wilshire.com/quote.html?symbol=dwc
Data plot for the past decade:
[5] Book: Guide to
Economic Indicators. By Richard Stutely.
Fifth edition. Bloomberg Press, 2003. Page
40: "[T]he rush to publish information often
means that figures are revised several times
as new information comes to hand, perhaps
causing major changes in interpretation. For
example, industrial production figures may
be based initially on sales and output data
and adjusted later to take account of
changes in inventories not caught in the
sales figures."
[6] Article: "Sunny
Clinton forecast leaves cloud over Bush." By
Robert Novak. CNN, August 9, 2002.
http://archives.cnn.com/2002/ALLPOLITICS/08/09/column.novak/
The Commerce Department's Bureau of Economic
Analysis estimates before-tax profits of
domestic nonfinancial corporations
quarterly. Revised figures last week showed
profits were really lower by 10.7 percent,
12.2 percent, 15.2 percent and 18 percent
for the four quarters of 1999. In 2000, this
gap became a chasm. The revised quarterly
profits for the election year are lower than
the announced figures by 23.3 percent, 25.9
percent, 29.9 percent and 28.2 percent.
[7] Table 1.14: "Gross
Value Added of Domestic Corporate Business
in Current Dollars and Gross Value Added of
Nonfinancial Domestic Corporate Business in
Current and Chained Dollar." Bureau of
Economic Analysis, U.S. Department of
Commerce. Downloaded 10/10/2008, Last
revised September 26, 2008. Line 36:
"Nonfinancial corporate business: Profits
before tax (without IVA and CCAdj)."
http://www.bea.gov/national/nipaweb/TableView.asp?Selected…
[8] Transcript: "CBS Evening News with Dan Rather." March 27, 2001. Rather: "President Bush is trying to distance himself from blame for economic problems and to deflect critics who say he isn't helping matters with repeated negative talk about it."
[9] Article: "Democrats
Accuse Bush of Helping to Slow the Economy;
White House Denies Aim Is to Sell Tax Cut."
By Dana Milbank. Washington Post,
March 16, 2001. Page A8.
http://www.washingtonpost.com/
The latest back-and-forth, coming amid
market turmoil, follows a drumbeat of
ominous forecasts by the Bush
administration. It began in December, when
Vice President-elect Cheney warned that the
country could be "on the front edge of a
recession." Since then, economic indicators
have deteriorated considerably.
[10] Table 1.1.1:
"Percent Change From Preceding Period in
Real Gross Domestic Product." Bureau of
Economic Analysis, U.S. Department of
Commerce. Downloaded 10/3/2008, Last
revised September 26, 2008. Line 1.
http://bea.gov/national/nipaweb/TableView.asp?SelectedTable=…
2000, 3rd quarter (Jul-Sept): -0.5%
[11] Article: "With
Words, Bush Runs Economic Risk." By Glenn
Kessler and Paul Blustein. Washington
Post, March 15, 2001. Page A1.
http://www.washingtonpost.com/
Kenneth Goldstein, a Conference Board
economist… suggested that consumers have
seen little impact from the slowing economy,
but their long-term outlook had been
affected by what opinion makers and the
media were saying.
"What happened is that a few politicians
opened their mouths and started to use the
R-word," Goldstein ventured. "And then
newspapers started to run big headlines
about layoffs."
[12] House editorial: "A
Moment of Economic Suspense." New York
Times, March 14, 2001.
http://query.nytimes.com/gst/fullpage.html?res=…
No one has a magic formula for ensuring
prosperity. But there are important policy
tools available and good reasons to believe
that a recession is avoidable. The White
House and the Fed, as well as Congress, must
now work in concert to prop up consumer
confidence.
The Federal Reserve must continue to do its
part by further dropping interest rates to
encourage spending. It is important, too,
for President Bush to quit talking down the
economy in order to build Congressional and
public support for his tax cut.
[13] Article: "Washington
Memo; For Bush, a Chronicle Of Bad News
Foretold." By David E. Rosenbaum. New
York Times, March 19, 2001.
http://query.nytimes.com/gst/fullpage.html?res=…
Normally, presidents are cheerleaders for
the nation's economy. …
Now comes George W. Bush, who is presenting
what an analysis in The Financial Times last
week called ''the novel spectacle'' of a
president ''urging citizens to ignore good
economic news and focus on the bad.''
[14] Article: "Zap!" By
Daniel Kadlec and others. Time, Mar.
26, 2001.
http://www.time.com/time/magazine/article/0,9171,999526,00.html
The worry factor is not to be underplayed.
Recessions and bear markets are as much
about psychology as fundamentals, which is
precisely why the stock market--unable to
find something it can believe in--has worked
up such a sweat. To that extent, the media
may be fueling the pessimism. In January,
TIME put the worried faces of a family of
four on the cover and expounded on HOW TO
SURVIVE THE SLUMP. More depressing has been
the recent stream of daily headlines about
plunging stock prices. And in a high-risk
bid to win support for his tax cuts,
President Bush has been sounding alarm bells
that reach into every kitchen.
[15] Editorial: "Hold the
Soup; It Takes a Sound Mind to Drive a
Strong Economy; Public Perception Fuels the
Nation's Fiscal Health." By William Neikirk.
Chicago Tribune, February 11, 2001.
http://www.chicagotribune.com/
All this is based on a simple premise: The
mind of the consumer is the most important
commodity in the economy. And for a good
reason: Two-thirds of gross domestic
product, the market value of annual
production of goods and service, is consumer
spending. …
One will never know for sure how much
Greenspan and President Bush have directly
contributed to the decline in confidence. To
put it mildly, neither has been a
cheerleader, with the Fed chairman telling
Congress the economy was, in effect, near a
recession, and the president, pushing his
$1.6 trillion tax cut, warning the economy
may be "in danger."
[16] News analysis:
"Bush: Talking down economy to build up tax
cut?" By Tom Raum. Associated Press,
March 28, 2001.
He has been warning of dark clouds in the
economic skies for months, and his top
spokesman, Ari Fleischer, has referred to
the slowdown as an ''economic downturn,''
even though there is no evidence that
economic growth has actually turned
negative. …
David Wyss, chief economist at Standard &
Poor's Corp., said the consumer confidence
report suggests Americans ''are no longer
worried, or as worried, that the economy
will be in worse shape a year from now.''
Bush should start being a little more upbeat
himself, Wyss suggested. ''If you're a
basketball coach, and you come in and tell
your team 'my predecessor was a lousy coach'
and 'you're a rotten team,' that's not a way
to win the next game,'' he said.
[17] Article: "With
Words, Bush Runs Economic Risk." By Glenn
Kessler and Paul Blustein. Washington
Post, March 15, 2001. Page A1.
http://www.washingtonpost.com/
Democrats have begun making the case that
Bush's rhetoric has already crossed the line
and helped to dangerously undermine consumer
confidence at a delicate time…
Gene Sperling, who served as an economic
adviser to President Bill Clinton, said, "…
It is very possible that the president's
continued drumbeat on talking down the
economy has become a self-fulfilling
prophecy."
[18] Article: "Democrats
Accuse Bush of Helping to Slow the Economy;
White House Denies Aim Is to Sell Tax Cut."
By Dana Milbank. Washington Post,
March 16, 2001. Page A8.
http://www.washingtonpost.com/
"I think what we're seeing is a talking down
of the economy," House Minority Leader
Richard A. Gephardt (D-Mo.) said in a news
conference yesterday, suggesting President
Bush's pessimistic outlook is a bid to sell
his tax cut. "I think that kind of economic
leadership is irresponsible. I think it's
mismanagement of our economy."
[19] Article: "Democrats
put blame on Bush." By Dave Boyer. Washington Times, March 16, 2001.
http://washingtontimes.com/
"The Bush administration has been talking
down the economy now for some time," said
Senate Minority Leader Tom Daschle at a
Capitol Hill news conference with House
Minority Leader Richard A. Gephardt.
[20] Bush was inaugurated
January 20, 2001.
[21] Twentieth Amendment to the Constitution of the United States. Ratified January 23, 1933. https://justfacts.com/constitution.asp#Amendment20
Section 1. The terms of the President and
Vice President shall end at noon on the 20th
day of January, and the terms of Senators
and Representatives at noon on the 3d day of
January, of the years in which such terms
would have ended if this article had not
been ratified; and the terms of their
successors shall then begin.
[22] Article: "60 Percent
Favor Bush, but Economy Is Major Concern."
By Richard L. Berke and Janet Elder. New
York Times, March 14, 2001.
http://www.nytimes.com/2001/03/14/politics/14POLL.html?…
Already, some Democrats are pointing fingers
at Mr. Bush. Ben Deloach, 54, a poll
respondent from Norfolk, Va., said in a
follow-up interview, "Everything just seems
to be going in the wrong direction now;
there are so many job cuts." Mr. Deloach, a
financial analyst, added: "People I know are
losing their jobs. This didn't happen during
the Clinton administration." (Bush has yet
to enact a single budget, therefore these
layoffs are a result of the Clinton
administration.)
[23] Article: "U.S.
Jobless Rate Rose to 4.5% in April." By
Louis Uchitelle. New York Times, May
5, 2001.
http://query.nytimes.com/gst/fullpage.html?res=…
[24] Article: "Layoffs
Renew Recession Fear: April Job Loss Biggest
in Decade." By Steven Pearlstein and John M.
Berry. Washington Post, May 5, 2001.
Page A1.
http://www.washingtonpost.com/
[25] Article: "$1.35
trillion tax cut becomes law." By Kelly
Wallace. CNN, June 7, 2001.
http://archives.cnn.com/2001/ALLPOLITICS/06/07/bush.taxes/
President George W. Bush signed into law
Thursday the first major piece of
legislation of his presidency, a $1.35
trillion tax cut over 10 years.
[26] "Citizen's Guide to
the Federal Budget: Fiscal Year 2000."
Section 3: "How Does the Government Create a
Budget?" Government Printing Office,
Updated January 24, 2008.
http://www.gpoaccess.gov/usbudget/fy00/guide03.html
The President and Congress both play major
roles in developing the Federal budget.
The President's Budget
The law requires that, by the first Monday
in February, the President submit to
Congress his proposed Federal budget for the
next fiscal year, which begins October 1. …
The President's budget is his plan for the
next year. But it's just a proposal. After
receiving it, Congress has its own budget
process to follow. Only after the Congress
passes, and the President signs the required
spending bills has the Government created
its actual budget.
[27] Media Monitor: "It's
Still the Economy, Bill: How TV Economic
News Has Changed Since Clinton's Election."
Edited by S. Robert Lichter and Linda S.
Lichter. Volume 7, Number 5. Center for
Media and Public Affairs, May 1993.
http://www.cmpa.com/files/media_monitor/93may.pdf
Page 1:
… the ABC, CBS, and NBC evening newscasts
together…
Page 3:
(To measure news tone, we tally all
assessments of the overall economy and
individual sectors by reporters and sources.
This measurement derives from specific
positive and negative evaluations of
economic health, not inferences about
economic statistics.) … Through the entire
third quarter (July-Sept) of 1992, 97
percent of all sources turned thumbs down on
the economy's performance.
Then the gloom boom suddenly ended, as
positive assessments jumped from only three
percent to 50 percent during the fourth
quarter. From the November 3 presidential
election through the end of the year, over
60 percent of economic evaluations were
favorable.
[28] Table 1.1.1:
"Percent Change From Preceding Period in
Real Gross Domestic Product." Bureau of
Economic Analysis, U.S. Department of
Commerce. Downloaded 10/3/2008, Last
revised September 26, 2008. Line 1.
http://bea.gov/national/nipaweb/TableView.asp?SelectedTable=…
|
1995-IV |
1996-I |
1996-II |
1996-III |
Average |
|
3.0 |
2.9 |
6.7 |
3.4 |
4.0 |
|
2003-IV |
2004-I |
2004-II |
2004-III |
Average |
|
2.7 |
3 |
3.5 |
3.6 |
3.2 |
[29] Table: "Unemployment
Rate - Civilian Labor Force - LNS14000000."
Bureau of Labor Statistics, U.S.
Department of Labor. Data extracted
October 3, 2008.
http://data.bls.gov/cgi-bin/surveymost?ln
|
1995 |
1996 |
|||||||||||
|
Oct |
Nov |
Dec |
Jan |
Feb |
Mar |
Apr |
May |
Jun |
Jul |
Aug |
Sep |
Avg. |
|
5.5 |
5.6 |
5.6 |
5.6 |
5.5 |
5.5 |
5.6 |
5.6 |
5.3 |
5.5 |
5.1 |
5.2 |
5.5 |
|
2003 |
2004 |
|||||||||||
|
Oct |
Nov |
Dec |
Jan |
Feb |
Mar |
Apr |
May |
Jun |
Jul |
Aug |
Sep |
Avg. |
|
6.0 |
5.8 |
5.7 |
5.7 |
5.6 |
5.8 |
5.6 |
5.6 |
5.6 |
5.5 |
5.4 |
5.4 |
5.6 |
[30] Table: "Consumer
Price Index, All Urban Consumers (CPI-U),
U.S. city average, All items." Bureau of
Labor Statistics, U.S. Department of Labor,
September 16, 2008.
ftp://ftp.bls.gov/pub/special.requests/cpi/cpiai.txt
|
CPI |
||
|
Sept 1995 |
Sept 1996 |
Increase |
|
153.2 |
157.8 |
3.0% |
| CPI | ||
|
Sept 2003 |
Sept 2004 |
Increase |
| 185.2 | 189.9 | 2.5% |
[31] Article: "The Year
of the Yawn." By Adam Nagourney. New York
Times, November 3, 1996.
http://query.nytimes.com/gst/fullpage.html?res=…
The economy is good, the country is not at
war and President Clinton has rebounded from
the depths of his unpopularity just two
years before. …
''When you're an incumbent, and the economy
is doing well,'' Mr. Stephanopoulos said
recently, ''boring is good.''
[32] Article: "U.S.
economy is fine: The only thing faltering is
media objectivity." By Jack Kelly. Pittsburgh Post-Gazette, April 04, 2004.
http://www.post-gazette.com/pg/04095/295352.stm
[33] Article: "Threats
and Responses: The Overview; Rice Would Take
More Questions From 9/11 Panel." By Adam
Nagourney & Richard W. Stevenson. New
York Times,
http://query.nytimes.com/gst/fullpage.html?res=…
With the economy faltering and Democrats so
united, Mr. Bush's terrorism credentials are
portrayed by his supporters as the strongest
assets he has going against Mr. Kerry.
[34] Column: "The Media's
Elastic Economy." By L. Brent Bozell III.
Media Research Center, November 2, 2004.
http://www.mediaresearch.org/BozellColumns/newscolumn/2004/col20041102.asp
[35] Report: "One
Economy, Two Spins." By Dan Gainor. Free
Market Project, Media Research Center,
October 14, 2004.
http://www.freemarketproject.org/specialreports/2004/jobs_study/sr20041014.asp
[36] Column: "Under
Democrats, Slower Growth was Seen as Good
News." Media Research Center, October
29, 2004.
http://www.mediaresearch.org/realitycheck/2004/fax20041029.asp
[37] Article: "Predicting
Presidential Winners: Is It the Economy, or
Is It the Media?" By Rich Noyes. Media
Research Center, June 2, 2000.
http://www.mediaresearch.org/medianomics/2000/mn20000602.asp
[38] Column: "Democratic
delusions." By Larry Elder. WorldNetDaily,
December 22, 2005.
http://www.worldnetdaily.com/index.php?pageId=34030
Forty-three percent of Americans, according
to a recent American Research Group poll,
said the economy was in a recession. …
… Most economists define a recession as
three consecutive quarters of falling real
gross national product. Yet for the last 10
quarters, the economy grew at an average of
more than 3 percent, with the latest quarter
coming in at 4.3 percent. Inflation and
interest rates remain low, with
homeownership at an all-time high. …
Unemployment, coming in at 5 percent,
remains lower than the average unemployment
rate during the '70s, '80s and '90s.
[39] Poll Update:
"American Research Group, Economic
Upheaval." National Journal Group,
December 19, 2005.
Nat'l Econ In Recession? …
11/05 – 43%
[40] Table 1.1.1:
"Percent Change From Preceding Period in
Real Gross Domestic Product." Bureau of
Economic Analysis, U.S. Department of
Commerce. Downloaded 10/3/2008, Last
revised September 26, 2008. Line 1.
http://bea.gov/national/nipaweb/TableView.asp?SelectedTable=…
|
1995-IV |
1996-I |
1996-II |
1996-III |
Average |
|
3.0 |
2.9 |
6.7 |
3.4 |
4.0 |
|
2004-IV |
2005-I |
2005-II |
2005-III |
Average |
|
2.5 |
3.0 |
2.6 |
3.8 |
3.0 |
[41] Table: "Unemployment
Rate - Civilian Labor Force - LNS14000000."
Bureau of Labor Statistics, U.S.
Department of Labor. Data extracted
October 3, 2008.
http://data.bls.gov/cgi-bin/surveymost?ln
|
1995 |
1996 |
|||||||||||
|
Oct |
Nov |
Dec |
Jan |
Feb |
Mar |
Apr |
May |
Jun |
Jul |
Aug |
Sep |
Avg. |
|
5.5 |
5.6 |
5.6 |
5.6 |
5.5 |
5.5 |
5.6 |
5.6 |
5.3 |
5.5 |
5.1 |
5.2 |
5.5 |
|
2004 |
2005 |
|||||||||||
|
Nov |
Dec |
Jan |
Feb |
Mar |
Apr |
May |
Jun |
Jul |
Aug |
Sep |
Oct |
Avg. |
|
5.4 |
5.4 |
5.2 |
5.4 |
5.2 |
5.1 |
5.1 |
5.0 |
5.0 |
4.9 |
5.1 |
5.0 |
5.2 |
[42] Table: "Consumer
Price Index, All Urban Consumers (CPI-U),
U.S. city average, All items." Bureau of
Labor Statistics, U.S. Department of Labor,
September 16, 2008.
ftp://ftp.bls.gov/pub/special.requests/cpi/cpiai.txt
|
CPI |
||
|
Sep 1995 |
Sep 1996 |
Increase |
|
153.2 |
157.8 |
3.0% |
|
CPI |
||
|
Oct 2004 |
Oct 2005 |
Increase |
|
190.9 |
199.2 |
4.3% |
[43] Table 1.1.1:
"Percent Change From Preceding Period in
Real Gross Domestic Product." Bureau of
Economic Analysis, U.S. Department of
Commerce. Downloaded 10/9/2008, Last
revised September 26, 2008. Line 1.
http://bea.gov/national/nipaweb/TableView.asp?SelectedTable=…
2001, 1st quarter: -0.5%
NOTE: Average of annual data from 1983-2007.
[44] Article: "Economic
Growth Revised Higher." By Michael M.
Grynbaum. New York Times, August 29,
2008.
http://www.nytimes.com/2008/08/29/business/29econ.html?_r=…
Gross domestic product rose at a 3.3 percent
clip in the second quarter, the Commerce
Department said, a significant jump over the
original estimate of 1.9 percent growth.
G.D.P., the broadest measure of the nation's
economic activity, is considered a good
barometer of America's economic health.
[45] Article: "G.D.P.
Grows at Tepid 1.9% Pace Despite Stimulus."
By Peter S. Goodman. New York Times,
August 1, 2008.
http://www.nytimes.com/
NOTE: The article was subsequently retitled
"More Arrows Seen Pointing to a Recession"
and is located at
http://www.nytimes.com/2008/08/01/business/01econ.html?hp
[46] Book: The Secrets
of Economic Indicators. By Bernard
Baumohl. Fourth edition, Wharton School
Publishing, 2005.
Page 21:
Government agencies and private groups that
supply economic data to the public are under
tremendous pressure to get it out quickly,
and that's not easy. … It's a hurried
process where accuracy and completeness take
a back seat at times to getting the
information out on deadline. For this reason
the first release of many economic
indicators contain pieces of data that are
far from reliable and thus considered
preliminary.
Of course, to many investors, it makes
little difference whether the initial data
is reliable. They'll trade on these numbers
anyway because these figures represent the
very latest information they can get on the
economy. Later, though, as more information
is received and after statisticians have had
a chance to review their computations, the
preliminary figures undergo one or more
revisions. Though revisions to earlier data
are also read by investors, they generally
do not spark much trading because by then
the information refers to a time period that
has long since passed. Investors usually
focus on the future, not the past.
Economists, however, take revisions more
seriously because the new figures can affect
their forecasts of economic activity.
[47] Book: Tracking
America's Economy. By Norman Frumkin.
M.E. Sharpe, 2004. Page 21:
Economic indicators are developed from data
obtained in surveys of households,
businesses, and governments, and from tax
and regulatory reports submitted to the
federal and state governments. … Because
policymakers in the presidential
administration, Congress, and the Federal
Reserve System want the indicators as soon
as possible following the month or quarter
to which they refer, the data are initially
provided on a preliminary basis and are
subsequently revised as more complete and
accurate survey information is received. The
use of preliminary and revised information
results from the tension between the need
for both timely and accurate data. Revisions
are sometimes substantial, and therefore it
is important that preliminary information be
treated as tentative.
[48] Article: "Jobless
rate jumps to 5-year high of 6.1 percent
(AP)." By Jeannine Aversa. Associated
Press, September 5, 2008.
http://news.yahoo.com/
NOTE: This article was displayed as the top
headline on Yahoo! Mail at 9/5/08 11:00 AM.
[49] Table: "Unemployment
Rate - Civilian Labor Force - LNS14000000."
Bureau of Labor Statistics, U.S.
Department of Labor. Data extracted
October 3, 2008.
http://data.bls.gov/cgi-bin/surveymost?ln
NOTE: To establish annual unemployment
rates, averages were taken of the months in
each year from 1983 to 2007. These figures
were then verified through a cross-check
with data from the Social Security
Administration and then averaged over the 25
year period.
[50] For an explanation
of how the federal government came to
acquire such power, see
https://justfacts.com/socialspending.basics.asp
[51] Report: "The Federal
Government's Financial Health: A Citizen's
Guide to the 2007 Financial Report of the
United States Government." Accessed October
11, 2008 at
http://www.whitehouse.gov/omb/financial/reports/citizens_guide.pdf
Page 6: "Since World War II, federal revenue
as a share of GDP has been roughly constant
at around 18 percent."
[52] Article:
"Economics." Contributor: Henry J. Aaron,
Ph.D. (Senior Fellow, Brookings
Institution). World Book Encyclopedia,
2007 Deluxe Edition.
Every day, millions of men and women in the
United States work on farms and in factories
and offices. These men and women produce
trillions of dollars worth of goods and
services each year. The government does not
tell the people where to work. It does not
decide where most of the factories should be
built. Nor does the government dictate what
prices will be charged for most goods and
services. Yet the work is done, the prices
are set, and most Americans get the products
they need.
How does the economy work with so little
planning? The desire of most people to
improve their own welfare makes it work. In
the United States, people are free to
improve their economic standing. They may
try to find a job where they please and
generally may spend their income as they
wish. Of course, the government takes part
in many economic activities. But for the
most part, individuals and private
businesses run the American economy.
[53] Constitution
of the United States. Signed September
17, 1787. Enacted June 21, 1788.
https://justfacts.com/constitution.asp
Article I, Section 1: "All legislative
Powers herein granted shall be vested in a
Congress of the United States, which shall
consist of a Senate and House of
Representatives."
Article I, Section 7: "All Bills for raising
Revenue shall originate in the House of
Representatives; but the Senate may propose
or concur with Amendments as on other
Bills."
Article I, Section 8: "The Congress shall
have Power To lay and collect Taxes, Duties,
Imposts and Excises, to pay the Debts and
provide for the common Defence and general
Welfare of the United States…"
[54] "Citizen's Guide to
the Federal Budget: Fiscal Year 2000."
Section 3: "How Does the Government Create a
Budget?" Government Printing Office,
Updated January 24, 2008.
http://www.gpoaccess.gov/usbudget/fy00/guide03.html
The President and Congress both play major
roles in developing the Federal budget.
The President's Budget
The law requires that, by the first Monday
in February, the President submit to
Congress his proposed Federal budget for the
next fiscal year, which begins October 1. …
The President's budget is his plan for the
next year. But it's just a proposal. After
receiving it, Congress has its own budget
process to follow. Only after the Congress
passes, and the President signs the required
spending bills has the Government created
its actual budget.
[55] "Citizen's Guide to
the Federal Budget: Fiscal Year 2000."
Section 3: "How Does the Government Create a
Budget?" Government Printing Office,
Updated January 24, 2008.
http://www.gpoaccess.gov/usbudget/fy00/guide03.html
• Discretionary spending, which accounts for
one-third of all Federal spending, is what
the President and Congress must decide to
spend for the next year through the 13
annual appropriations bills. It includes
money for such activities as the FBI and the
Coast Guard, for housing and education, for
space exploration and highway construction,
and for defense and foreign aid.
• Mandatory spending, which accounts for
two-thirds of all spending, is authorized by
permanent laws, not by the 13 annual
appropriations bills. It includes
entitlements--such as Social Security,
Medicare, veterans' benefits, and Food
Stamps--through which individuals receive
benefits because they are eligible based on
their age, income, or other criteria. It
also includes interest on the national debt,
which the Government pays to individuals and
institutions that hold Treasury bonds and
other Government securities. The President
and Congress can change the law in order to
change the spending on entitlements and
other mandatory programs--but they don't
have to.
[56] Book: Guide to
Economic Indicators. By Norman Frumkin.
Fourth edition. M.E. Sharpe, 2006. xiii:
"The book explains the basic features of
more than sixty statistical measures of the
U.S. economy."
[57] Book: Guide to
Economic Indicators. By Richard Stutely.
Fifth edition. Bloomberg Press, 2003. Page
29: "All the major industrial countries now
use GDP as their main measure of national
economic activity."
[58] Book: Tracking
America's Economy. By Norman Frumkin.
M.E. Sharpe, 2004. Pages 3-4: "The overall
performance of the economy is reflected in
its economic growth. … This chapter
highlights the gross domestic product (GDP)
as the primary measure of economic growth."
[59] Book: Guide to
Economic Indicators. By Norman Frumkin.
Fourth edition. M.E. Sharpe, 2006. Page 245:
"The unemployment rate is a major indicator
of the degree to which the economy provides
jobs for those seeking work."
[60] Book: Tracking
America's Economy. By Norman Frumkin.
M.E. Sharpe, 2004. Page 271: "This chapter
focuses on the consumer price index (CPI) as
the prime measure of inflation and deflation
in the economy. The CPI is the most widely
cited measure of price change…"
[61] Book: Guide to
Economic Indicators. By Richard Stutely.
Fifth edition. Bloomberg Press, 2003. Page
21: "The consumer price index (CPI) is the
indicator most people use to track
inflation." Page 215: "CPIs are the most
timely and best understood inflation
indicators. … Consumer expenditures and GDP
deflators are often better guides to
inflation, but usually they are not
available quickly enough."
[62] Book: Guide to
Economic Indicators. By Norman Frumkin.
Fourth edition. M.E. Sharpe, 2006. Page 48:
"The CPI-U represents all urban households
including urban workers in all occupations,
the unemployed, and retired persons; it
accounts for about 87 percent of the
noninstitutional population."
[63] Summary of
information from the following sources:
1) "U.S. Presidential Election Results." Encyclopædia Britannica, 2007.
http://www.britannica.com/
2) Web Page: "Party Divisions of the House
of Representatives, 1789-Present." Office
of the Clerk, United States House of
Representatives. Accessed November 17,
2007 at
http://clerk.house.gov/art_history/house_history/partyDiv.html
3) Web Page: "Party Division in the Senate,
1789-Present." Historical Office, United
States Senate. Accessed June 25, 2008 at
http://www.senate.gov/pagelayout/history/one_item_and_teasers/partydiv.htm
SUMMARY:
1983: Reagan is President. Democrats have
commanding majority* in House and
Republicans have majority in Senate.
1985: Reagan's second term.
1987: Democrats acquire commanding majority*
in Senate.
1989: G.H. Bush takes office.
1993: Clinton takes office.
1995: Republicans acquire majority in House
and Senate.
1997: Clinton's second term. Republicans
acquire commanding majority* in Senate.
2001: G.W. Bush takes office. Democrats
acquire majority in Senate. #
2003: Republicans acquire majority in
Senate.
2005: Bush's second term. Republicans
acquire commanding majority* in Senate.
2007: Democrats acquire majority in House
and Senate.
* "Commanding majority" arbitrarily defined
as at least 20% more members than the
opposing party.
# Control of the Senate switched back and
forth during this period with Democrats
holding it for the majority of time.
[64] Table 1.1.1: "Percent Change From Preceding Period in Real Gross Domestic Product." Bureau of Economic Analysis, U.S. Department of Commerce. Downloaded 10/3/2008, Last revised September 26, 2008. Line 1. http://bea.gov/national/nipaweb/TableView.asp?SelectedTable=…
[65] Table: "Unemployment
Rate - Civilian Labor Force - LNS14000000."
Bureau of Labor Statistics, U.S.
Department of Labor. Data extracted
October 3, 2008.
http://data.bls.gov/cgi-bin/surveymost?ln
[66] Table: "Consumer
Price Index, All Urban Consumers (CPI-U),
U.S. city average, All items." Bureau of
Labor Statistics, U.S. Department of Labor,
September 16, 2008.
ftp://ftp.bls.gov/pub/special.requests/cpi/cpiai.txt
