When does optimism -- the Bush campaign's favorite word these days -- become an inability to face facts? Last Friday, US President George W. Bush insisted that a seriously disappointing jobs report, which fell far short of its pre-announcement hype, was good news: "We're witnessing steady growth, steady growth. And that's important. We don't need boom-or-bust-type growth."
But Bush has already presided over a bust. For the first time since 1932, employment is lower in the summer of a presidential election year than it was on the previous Inauguration Day. Americans badly need a boom to make up the lost ground.
And we're not getting it.
When March's numbers came in better than expected, I cautioned readers not to make too much of one good month. Similarly, we shouldn't make too much of June's disappointment.
The question is whether, taking a longer perspective, the economy is performing well. And the answer is no.
If you want a single number that tells the story, it's the percentage of adults who have jobs. When Bush took office, that number stood at 64.4. By last August it had fallen to 62.2 percent. Last month the number was 62.3. That is, during Mr. Bush's first 30 months, the job situation deteriorated drastically. Last summer it stabilized, and since then it may have improved slightly. But jobs are still very scarce, with little relief in sight.
Bush campaign ads boast that 1.5 million jobs were added in the last 10 months, as if that were a remarkable achievement. It isn't. During the Clinton years, the economy added 236,000 jobs in an average month. Those 1.5 million jobs were barely enough to keep up with a growing working-age population.
In the spring, it seemed as if the pace of job growth was accelerating: in March and April, the economy added almost 700,000 jobs. But that now looks like a blip -- a one-time thing, not a break in the trend. May growth was slightly below the Clinton-era average, and June's numbers -- only 112,000 new jobs, and a decline in working hours -- were pretty poor.
What about overall growth? After two and a half years of slow growth, real GDP surged in the third quarter of 2003, growing at an annual rate of more than 8 percent. But that surge appears to have been another blip. In this year's first quarter, growth was down to 3.9 percent, only slightly above the Clinton-era average. Scattered signs of weakness -- rising new claims for unemployment insurance, sales warnings at Target and Wal-Mart, falling numbers for new durable goods orders -- have led many analysts to suspect that growth slowed further in the second quarter.
And economic growth is passing working Americans by. The average weekly earnings of nonsupervisory workers rose only 1.7 percent over the past year, lagging behind inflation. The president of Aetna, one of the biggest health insurers, recently told investors, "It's fair to say that a lot of the jobs being created may not be the jobs that come with benefits." Where is the growth going? No mystery: after-tax corporate profits as a share of GDP have reached a level not seen since 1929.
What should we be doing differently? For three years many economists have argued that the most effective job-creating policies would be increased aid to state and local governments, extended unemployment insurance and tax rebates for lower- and middle-income families.
The Bush administration paid no attention -- it never even gave New York all the aid Bush promised after Sept. 11, and it allowed extended unemployment insurance to lapse. Instead, it focused on tax cuts for the affluent, ignoring warnings that these would do little to create jobs.
After good job growth in March and April, the administration declared its approach vindicated. That was premature, to say the least.
Whatever boost the economy got from the tax cuts is now behind us, and given the size of the budget deficit, another big tax cut is out of the question. It's time to change the policy mix -- to rescind some of those upper-income cuts and pursue the policies we should have been following all along.
One last point: government policies could do a lot about the failure of new jobs to come with health benefits, a huge source of anxiety for many American families. Senator John Kerry is right to make health care a central plank of his platform.
The gutting of Voice of America (VOA) and Radio Free Asia (RFA) by US President Donald Trump’s administration poses a serious threat to the global voice of freedom, particularly for those living under authoritarian regimes such as China. The US — hailed as the model of liberal democracy — has the moral responsibility to uphold the values it champions. In undermining these institutions, the US risks diminishing its “soft power,” a pivotal pillar of its global influence. VOA Tibetan and RFA Tibetan played an enormous role in promoting the strong image of the US in and outside Tibet. On VOA Tibetan,
Sung Chien-liang (宋建樑), the leader of the Chinese Nationalist Party’s (KMT) efforts to recall Democratic Progressive Party (DPP) Legislator Lee Kun-cheng (李坤城), caused a national outrage and drew diplomatic condemnation on Tuesday after he arrived at the New Taipei City District Prosecutors’ Office dressed in a Nazi uniform. Sung performed a Nazi salute and carried a copy of Adolf Hitler’s Mein Kampf as he arrived to be questioned over allegations of signature forgery in the recall petition. The KMT’s response to the incident has shown a striking lack of contrition and decency. Rather than apologizing and distancing itself from Sung’s actions,
US President Trump weighed into the state of America’s semiconductor manufacturing when he declared, “They [Taiwan] stole it from us. They took it from us, and I don’t blame them. I give them credit.” At a prior White House event President Trump hosted TSMC chairman C.C. Wei (魏哲家), head of the world’s largest and most advanced chip manufacturer, to announce a commitment to invest US$100 billion in America. The president then shifted his previously critical rhetoric on Taiwan and put off tariffs on its chips. Now we learn that the Trump Administration is conducting a “trade investigation” on semiconductors which
By now, most of Taiwan has heard Taipei Mayor Chiang Wan-an’s (蔣萬安) threats to initiate a vote of no confidence against the Cabinet. His rationale is that the Democratic Progressive Party (DPP)-led government’s investigation into alleged signature forgery in the Chinese Nationalist Party’s (KMT) recall campaign constitutes “political persecution.” I sincerely hope he goes through with it. The opposition currently holds a majority in the Legislative Yuan, so the initiation of a no-confidence motion and its passage should be entirely within reach. If Chiang truly believes that the government is overreaching, abusing its power and targeting political opponents — then
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