The Economy Or Fox News: The White House Must Decide
The latest run of data make it clear that an economy in free fall during George W. Bush's last year in office has stabilized. On Wednesday, the investor class, again feeling its inner Gordon Gekko, pushed the Dow back over the 10,000 level. Greed must be good because the blue chips have soared 53% in just seven months, this, after stocks reached rock bottom in March. The stock market doesn't represent the real economy, but the 10,000 mark has special symbolism considering what happened in the previous year and a half.
Though job losses remain a problem, the huge layoffs registered in 2008 and the first months of 2009 are done with and the 22-month-long recession is now over, according to the National Association of Business Economists. Not to pop the confetti just yet as Main Street still has quite a way to catch up with Wall Street. Still, policy makers no longer agonize about the looming prospect of a global depression - and that means the rest of us finally can exhale.
So what does the White House do? It picks a fight with the hacks at Fox, where the network's hired help were delighted to milk the "story" for all it was worth (which wasn't much) to help their ratings.
White House spokesman Robert Gibbs instead ought to have distributed copies of the latest U.S. Census in the press room. Dry reading, but a veritable treasure trove offering a snapshot of what our country looks like in any particular era. Unfortunately, memories are short in our ADD-riddled media culture and we get distracted by sideshows. After a summer's worth of ranting about presidential birth certificates, commies in high office, and the signs of an impending totalitarian coup - Nazi or Socialist (or both), it's easy to overlook how much ground most Americans lost financially between 2007 and 2008. Among other things:
• Real median household income fell by 3.6 percent to offset any gains Americans made during the previous three years.
• The overall poverty rate increased.
• Men's median earnings declined by 1.0 percent to $46,367 while women's declined by 1.9 percent to $35,745.
In other words, a thoroughly lousy time was had by all - unless you were fortunate to come out a big winner in the Game of Life and belonged to America's upper class.
But however slowly, the economy is regaining its footing. What with $787 billion in stimulus money being spent under its watch, the Obama team now has ownership of the economy (especially since the Republicans opposed the idea from the start.) So it is that consumer confidence has been climbing, housing has bounced off its lows and retail is showing scattered signs of life. Another encouraging sign:retail inventories (not including automobiles) decline just .3%. That is the smallest drop since March, which the stock market fell to its lowest point.
It's still too early to say which side was right in the debate. All that spending is worrisome and the threat of inflation has helped push gold levels to record levels. With a huge deficit and a weak dollar, the doom-and-gloomers warn it may lead to a crisis if those trends don't reverse. They may turn out to be right.
But one crisis at a time. More immediately, 401K statements are arriving in the mail and millions of people who only a few months earlier were in utter despair over the American dream will be reassured.