- Before America allows President Bush to take bows on
the economy, let's take a closer look at this recovery. A simple thought
experiment -- the kind former President Reagan used to like to do -- will
help.
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- 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.
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- But you'd never do that.
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- 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 Bush's recovery is --
a giant borrowing binge. But he'd rather you didn't know that. In February,
the administration buried a report from its own Treasury Department that
said our current fiscal policies, the ones Bush likes to claim are bringing
on a "recovery," would create more than $44 trillion in chronic
debt.
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- As the London Financial Times noted, $44 trillion is
roughly equivalent to 10 times the publicly held national debt, four years
of U.S. economic output or more than 94 percent of all U.S. household assets.
No wonder things seem good. We've cashed in everything we own at the Bush
Pawn Shop, and now we're flashing a serious wad of walkin' around money.
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- The Democrats like to point out that we're still down
some 2.5 million jobs since Bush took over and that, absent a miracle,
Bush is likely to be the first president since Herbert Hoover to have fewer
jobs at the end of his administration than when he took over. But the real
story is, how can we not be living even larger, after borrowing all our
children's assets and shrinking the Federal Reserve rate to the lowest
level since 1958? What have we got to show for it?
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- An essentially jobless recovery. Bush likes to say the
jobs will come. They'd better. Because right now, all he's managed to do
is spend about $350 billion of "your money" to hire 328,000 checkout
clerks and greeters at the local Wal-Mart. Meanwhile, we've shipped some
2.6 million high-paying manufacturing jobs overseas since January 2001.
Is this a success?
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- So if we're cutting taxes by $350 billion a year in order
to stimulate the economy and the economy is growing, but we're only getting
an anemic response in employment, what's up? Kenneth L. Lay's stock portfolio,
for one thing. And the portfolio of those Bush pioneers we hear so much
about. And, of course, Bush's campaign contributions. As for the rest of
us?
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- Bush seems to think people can eat gross domestic product.
But a growing economy doesn't mean a whole lot if it's not creating jobs.
Unless you happen to be Lay or one of those Bush pioneers who don't need
a job to earn money.
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- Not a surprising result, really. Look at Bush's economic
plan. He says the tax cuts were about "your money." But the truth
is, if you're like 80 percent of Americans, most of the taxes you pay from
"your money" are in the form of payroll taxes. And until Bush
gave it away, you got "your money" and more back in the form
of Social Security, Medicare and disability income.
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- Lay and his friends pay most of their taxes in the form
of income taxes, dividends and capital gains. Guess which ones Bush cut?
Not your payroll taxes. What's the biggest pot of money subject to double
taxation? "Your money" -- the payroll tax. What double taxation
did Bush eliminate? Ken and friends' dividend tax.
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- For some reason, Bush thought it was OK for you to be
double taxed, but not all right for Ken and his CEO friends. Bottom line:
Bush traded away "your money" to give his wealthiest millionaire
buddies an annual tax cut of $40,000 or more each.
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- The Democrats seem to be trembling at the recent numbers
on the economy. They shouldn't. We can't be a nation of Wal-Mart shoppers
if we're all employed at Wal-Mart. And that's exactly where Bush's plan
is taking most of us. Democrats should just quit worrying and give credit
-- or blame -- where it's due.
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- - John Atcheson has held several policy positions in
federal agencies.
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- © Copyright 2003, The Salt Lake Tribune.
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- http://www.sltrib.com/2003/Dec/12282003/commenta/123683.asp
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