This morning's Yahoo Top Stories headlines read:
Economy Slows to Near Crawl*
followed by:
Bush: US is Not Headed Into Recession*
Maybe it's just me, but those two appear to contradict one another.
When headlines clash, one is forced to consider the details and to follow up with their own experience to arrive at what one hopes is a logical conclusion (or) as I like to say, the truth that is buried in there somewhere. Let's do that here.
We'll start with the claims within the articles...
Excerpts from Article #1 by AP Economics Writer Jeannine Aversa state:
WASHINGTON - The economy skidded to a near halt in the final quarter of
last year, clobbered by dual slumps in housing and credit that caused
people and businesses to spend and invest more sparingly...
Builders slashed spending on housing projects by a whopping 25.2
percent on an annualized basis in the fourth quarter, the biggest cut
in 26 years...
...the Labor Department reported Thursday that new applications for unemployment insurance benefits rose by 19,000 to 373,000 last week, more evidence that the general economic sluggishness is spilling over into the job market.
With inflation rising as the economy slows, fears are increasing that
the country may be headed for a bout of stagflation. That's a scenario
the country hasn't experienced since the 1970s.
and then it says...
Oil prices have reach [sic] new record highs, galloping past $100 a barrel in
recent days. High energy prices can spread inflation by boosting the
costs of a wide variety of other goods and services and can put a
further damper on overall economic growth by crimping consumer spending.
but wait, it says there's hope:
There was a bright spot in the report, however. Sales of U.S. goods and
services to other countries grew at a 4.8 percent pace in the fourth
quarter, better than previously estimated. U.S. exports have been
helped by the declining value of the U.S. dollar, which makes U.S.
goods less expensive on foreign markets. The U.S dollar dipped to
another record low on Thursday in Europe.
So, we can gather from this report that jobs are down, fuel is at an astronomical high, the dollar is at an all time low. This report also included some figures with decimal points about percentages not meeting expectations etc. etc. Generally, all bad looking news, but then, I'm no economist.
Apparently, neither is our defacto commander in chief. Let's examine what he has to say about it in an article by White House correspondent Terrance Hunt (#2):
WASHINGTON - President Bush
said Thursday the country is not recession-bound and, despite
expressing concern about slowing economic growth, rejected for now any
additional stimulus efforts. "We acted robustly," he said...
..."We'll see the effects of this pro-growth package," Bush told reporters at a White House news conference,
acknowledging that some lawmakers already are talking about a second
stimulus package. "Why don't we let stimulus package 1, which seemed
like a good idea at the time, have a chance to kick in?"...
On one issue particularly worrisome to American consumers, there are
indications that paying $4 for a gallon of gasoline is not out of the
question once the summer driving season arrives. Asked about that, Bush
said "That's interesting. I hadn't heard that. ... I know it's high
now."
Bush also telegraphed optimism about the U.S. dollar, which has been declining in value.
"I believe that our economy has got the fundamentals in place for us
to ... grow and continue growing, more robustly hopefully than we're
growing now," he said. "So we're still for a strong dollar."
Well alright then...he's for a strong dollar. Good to know. And if the president isn't worried about the economy, why should the rest of us worry? I mean, if anybody knows what's really going on, we should assume it's him, right? I mean, he has advisors and stuff; we assume he doesn't have to play the news games that we're doing here in an effort to divine the truth somewhere in the mix - he's got REAL information - not dependent on conglomerated news sources.
So, phew! The president is ok, with the economy, despite the reportings of Ms. Aversa and those hysterical hordes of economists. Plus, his personal economic situation doesn't seem to be suffering much...So what is he worried about? What keeps our commander in chief up at night? Look! It's right here in the same article that is headlined about Bush's opinion of the state of our economy...
Bush also used his news conference to press Congress to give
telecommunications companies legal immunity for helping the government
eavesdrop after the Sept. 11 terrorist attacks.
He continued a near-daily effort to prod lawmakers into passing his
version of a law to make it easier for the government to conduct
domestic eavesdropping on suspected terrorists' phone calls and
e-mails. He says the country is in more danger now that a temporary
surveillance law has expired.
Bush said the companies helped the government after being told "that
their assistance was legal and vital to national security." "Allowing
these lawsuits to proceed would be unfair," he said.
Oh good, he's got the best interest of the telecommunications companies in the front of his radar. What else?
Bush criticized the Democratic presidential candidates over their
attempts to disassociate themselves from the North American Free Trade
Agreement, a free-trade pact between the U.S., Canada and Mexico. Bush said the deal is contributing to more and better-paying jobs for Americans.
Oh great! NAFTA! More and better paying jobs....that doesn't seem to mesh up with the increase in unemployment insurance claims, but whatever..I am sure he knows what he's talking about. I'm for more and better paying jobs, that's for sure.
In a last spasm of irony, Bush says he's not interested in sitting down at a table with "a tyrant like Raul Castro" because it lends him credibility. He goes on to say,
I'm Raul Castro (is) "nothing more than an extension of what my father his brother did, which is ruin an country island and eventually the planet."
Here's the economy from my house:
Two uninsured, unemployed occupants,splitting $1000 per month rent. Average heating bill $200 (2 bedroom unit). Job market is offering an average $8-10 per hour, even for skilled administrative work for which there are easily 100 applicants per position (I've inquired). College tuition in Vermont $8,771 per year with no guarantee that at the end of the line there'll be a job waiting (who do you think constitutes the majority of those 100 applicants, hmmm?) Decent bread (not white sandwich) is $4-5 per loaf and milk is $4+ a gallon (in a dairy state!). Organic local green cabbage is $1.15 per pound making a medium sized head cost over $5. Yesterday while driving around, I noticed gas prices for regular unleaded were between $3.17 and $3.33 for regular unleaded. That's gotta pinch the commuters, especially since Vermont has little to no public transportation and jobs are spread out across the state.
Looks pretty grim. I wonder, if Bush isn't worried now, what is it going to take?
Ready for suggestions,
XXKHT
*excerpts reprinted without permission. Please follow the hyperlinks for the full text versions.
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