The Lonely Booming Economy – UPDATED

It sounds like a Grimms Brother’s Tale, doesn’t it?

Willisms takes it on. 5 million jobs in 30 months, and it’s still a “Rodney Dangerfield Economy” that can’t get no respect. No one wants to be its friend. Half the country denies it exists, even as they drive their shiny new cars to the restaurant to drink $8.00 cocktails after drinking the $4.00 coffees all day at work. After buying the latest CD, after seeing the latest play, after picking out their spring wardrobe, after planning this year’s vacation(s).

I have friends planning to go on a Disney Cruise, and they’re scouting out the big “Mediterranean” Disney Cruise for next year – ten grand before they step on the plane to Portugal – and they’re not batting an eye, and they’re your basic middle class people; they’re by no means rich. How are they planning it? By saving for it out of their “stagnant” wages and the fact that they were able to re-finance the house they purchased at 8% interest a few years ago to a new mortgage of just under 5%. Unemployment is a low 4.8%. Under a different president, that would – of course – be “full employment.”

Willism has graphs, he’s got charts, he’s got all sorts of information about the economy that no one is reporting or looking at. He demonstrates the literal chasm that exists between parties as to their perceptions about the economy. According to the left, we’re in the worst economy ever, much worse than the Carter economy, with double digit inflation and unemployment. We’re all out of work, we’re shoeless and homeless, we’re on bread lines. We’re selling apples on the streetcorner…and yet somehow, all of these poor people have computers and iPods and blackberries with which to complain about it, kvetch and organize “protests.”

He also has this observation:

Incidentally, the Pew Research Center blames President Clinton’s sub-30 satisfaction level on the economy. “The Clinton administration inherited that bad economy,” they claim.

How many times does this claim need to be refuted, anyway? As Clinton assumed office, the recession had ended many months before. It was this president, George W. Bush, that inherited a weak economy, not President Clinton in 1992. However, it was President Clinton, not this president, who received a boost in poll ratings from a booming economy.

Will President George W. Bush ever receive a poll rating boost that reflects the strength of the American economy today? There’s still nearly 3 years left in his term, so I wouldn’t rule anything out.

Rule it out. Unless SOMEONE in the press gets an attack of conscience and starts reporting fairly (unlikely) or SOMEONE in the Democrat party starts being honest (even more unlikely – they see what happened to Joe Lieberman for daring to try that…) everything about this president and his legacy will be as negative as possible. The history books will also be negative, because they’ll be written by people who will have these reams of news articles “proving” that Bush was “the worst and most incompetent president of all time.” History is being revised and set in archives with every deadline.

Sorry to sound negative, but…it’s true.

More on the lonely booming economy from this economist.

Meanwhile, Consumer Confidence Soars.

About Elizabeth Scalia
  • Sigmund Carl and Alfred

    Good post.

    I suspect when the cycle comes full circle, the administration will be blamed for encouraging those $4.00 cups of coffee.

    Look for the NYT to discuss the virtue of frugality.

  • Sigmund Carl and Alfred

    Good post.

    I suspect when the cycle comes full circle, the administration will be blamed for encouraging those $4.00 cups of coffee.

    Look for the NYT to discuss the virtue of frugality.

  • Joseph

    Let me be blunt. This is a bunch of horsefeathers if you are talking about anywhere outside of the New York, Boston, or Washington metro areas.
    /
    Out here in the hinterlands we have quite accurate, fast, and reliable feedback about how are local economies are doing, much of it from our local newspapers.
    /
    We have it because a plant closing or a steep rise in mortgage forclosures [both very prominent features of the Ohio economy at the moment--many of them from exactly the same re-financing boom which you are celebrating] has a real and profound effect on metro areas of 1-2 million people while it’s equivalent simply vanishes without a trace in the massive economies, largely propped up by stock speculation, of the BosWash corridor.
    /
    And every drop of “good news” in the broader economic picture is featured on the Business pages for anyone who cares to read. And most do. We read our local newspapers thoroughly and religiously.
    /
    What of the hinterlands, then? The economy is anemic at best, dreadful at worst. Why? Because our measures are the following: real take-home pay; gasoline prices and their corresponding effects on goods prices–particularly food; rents and house prices; consumer debt levels; and health insurance costs.
    /
    We are also extremely tuned in to the flat out disappearance of things like long term pension funds and the gradual squeezing away of all work-related benefits.
    /
    They are sensible measures, which directly impact the majority of ordinary people out here, who are already employed and remained so throughout the early 2000′s. Unemployment figures mean little or nothing to them.
    /
    And they are measures which have placed ordinary people outside of BosWash under steadily increasing economic stress since the year 2000–particularly gasoline prices, rents, and health insurance.
    /
    Virtually every one of these quite sensible measures have shown absolutely no responsiveness to the “boom” which you are describing.
    /
    Wages have stayed flat, gasoline costs and rents have steadily climbed as more and more of us have been priced out of the housing market and automobile commuter times and distances have gradually increased, pensions have been regularly imploding as part of the “greater productivity” of the American workforce [it used to be called "sweating"], and consumer debt levels have ballooned as most of us rely more and more on credit [both plastic and home equity loans] to maintain a non-contracting lifestyle under these circumstances.
    /
    And, by the way, a contracting lifestyle in the hinterlands generally means a significant decrease in your employability as well as your standard of living. So advice to “be more frugal and borrow less” is not greeted with much enthusiasm.
    /
    The New York Times, or the Democratic Party have nothing new to tell us about our own situation. Neither does the Bush Adminstration.
    /
    But you can bet that in November 2006 we will have a considerable amount to tell them. The “right track”/”wrong track” questions measure quite well-informed opinion outside of the circle of local readership of the major papers of Boston, New York, Philadelphia, and Washington.
    /
    And it was largely not the people in that fine BosWash corridor who put Bill Clinton in office, either.

  • Joseph

    Let me be blunt. This is a bunch of horsefeathers if you are talking about anywhere outside of the New York, Boston, or Washington metro areas.
    /
    Out here in the hinterlands we have quite accurate, fast, and reliable feedback about how are local economies are doing, much of it from our local newspapers.
    /
    We have it because a plant closing or a steep rise in mortgage forclosures [both very prominent features of the Ohio economy at the moment--many of them from exactly the same re-financing boom which you are celebrating] has a real and profound effect on metro areas of 1-2 million people while it’s equivalent simply vanishes without a trace in the massive economies, largely propped up by stock speculation, of the BosWash corridor.
    /
    And every drop of “good news” in the broader economic picture is featured on the Business pages for anyone who cares to read. And most do. We read our local newspapers thoroughly and religiously.
    /
    What of the hinterlands, then? The economy is anemic at best, dreadful at worst. Why? Because our measures are the following: real take-home pay; gasoline prices and their corresponding effects on goods prices–particularly food; rents and house prices; consumer debt levels; and health insurance costs.
    /
    We are also extremely tuned in to the flat out disappearance of things like long term pension funds and the gradual squeezing away of all work-related benefits.
    /
    They are sensible measures, which directly impact the majority of ordinary people out here, who are already employed and remained so throughout the early 2000′s. Unemployment figures mean little or nothing to them.
    /
    And they are measures which have placed ordinary people outside of BosWash under steadily increasing economic stress since the year 2000–particularly gasoline prices, rents, and health insurance.
    /
    Virtually every one of these quite sensible measures have shown absolutely no responsiveness to the “boom” which you are describing.
    /
    Wages have stayed flat, gasoline costs and rents have steadily climbed as more and more of us have been priced out of the housing market and automobile commuter times and distances have gradually increased, pensions have been regularly imploding as part of the “greater productivity” of the American workforce [it used to be called "sweating"], and consumer debt levels have ballooned as most of us rely more and more on credit [both plastic and home equity loans] to maintain a non-contracting lifestyle under these circumstances.
    /
    And, by the way, a contracting lifestyle in the hinterlands generally means a significant decrease in your employability as well as your standard of living. So advice to “be more frugal and borrow less” is not greeted with much enthusiasm.
    /
    The New York Times, or the Democratic Party have nothing new to tell us about our own situation. Neither does the Bush Adminstration.
    /
    But you can bet that in November 2006 we will have a considerable amount to tell them. The “right track”/”wrong track” questions measure quite well-informed opinion outside of the circle of local readership of the major papers of Boston, New York, Philadelphia, and Washington.
    /
    And it was largely not the people in that fine BosWash corridor who put Bill Clinton in office, either.

  • TheAnchoress

    You seem to think, Joe, that I do not know people who live in the midwest, the south or elsewhere in the country.

    The fact is, I grew up outside of the BosWash corridor and have friends of every stripe – in every sort of profession or “job” – all over the country. Not all of them are educated. Very few in fact are “professional” people. And they all think the economy is doing pretty well. Their lives are good. They’ve got slices of the American dream and don’t think everything is crap. And yes, some of them are even Democrats. Moderate dems…but still dems! :-)

  • TheAnchoress

    You seem to think, Joe, that I do not know people who live in the midwest, the south or elsewhere in the country.

    The fact is, I grew up outside of the BosWash corridor and have friends of every stripe – in every sort of profession or “job” – all over the country. Not all of them are educated. Very few in fact are “professional” people. And they all think the economy is doing pretty well. Their lives are good. They’ve got slices of the American dream and don’t think everything is crap. And yes, some of them are even Democrats. Moderate dems…but still dems! :-)

  • Joseph

    Of course it is perfectly possible to be satisfied about the situation here in Columbus, if your paycheck is stable, you have enough discretionary income to handle rising fuel costs, your job is secure and still covers part of your health insurance, and you are not near forclosure.

    It was perfectly possible to be equally satisfied with it at the worst point of the economic cycle in 2001-2002, since the bad things about it didn’t personally touch you.

    Many people who are not “rich” have these even in the worst of times. The key to the matter is “discretionary income”. You do not have to be rich to have this, but below a certain income level you simply do not have it. The inelastic demands for food, shelter, energy, transportation, and health care rob you of it.

    You may indulge in a cup of fancy coffee now and then, but you certainly don’t buy Blackberrys. If you are virtual at all, you are running Windows 98 on a computer you scored for a song at University surplus and a monitor you scavenged on trash day from one of the better neighborhoods or found at the Volunteers of America thrift store while shopping for presentable second-hand clothes.

    Trust me. I know this from personal experience.

    I said this a little down the roll, but I’ll repeat it. We are becoming two Americas–one with discretionary income and insulated from economic downturns, and the other without discretionary income bounced from truly flush times sustained by working so much overtime that you hardly do anything else [even sleep] to truly bad times in the unemployment line, flipping burgers, or working at Wal-Mart, and in all three cases on Food Stamps, Home Heating Assistance, and [if you're lucky] Medicaid.

    That is the real American underbelly and not “selling apples on the street”.

    And the real outrage and tragedy is that, by and large, the wall between these two Americas has steadily gotten higher and thicker.

    It is still possible to climb over it. But it is becoming slightly less possible to do it with every passing year. And even “slightly less” accumulates into something significant given enough time.

  • Joseph

    Of course it is perfectly possible to be satisfied about the situation here in Columbus, if your paycheck is stable, you have enough discretionary income to handle rising fuel costs, your job is secure and still covers part of your health insurance, and you are not near forclosure.

    It was perfectly possible to be equally satisfied with it at the worst point of the economic cycle in 2001-2002, since the bad things about it didn’t personally touch you.

    Many people who are not “rich” have these even in the worst of times. The key to the matter is “discretionary income”. You do not have to be rich to have this, but below a certain income level you simply do not have it. The inelastic demands for food, shelter, energy, transportation, and health care rob you of it.

    You may indulge in a cup of fancy coffee now and then, but you certainly don’t buy Blackberrys. If you are virtual at all, you are running Windows 98 on a computer you scored for a song at University surplus and a monitor you scavenged on trash day from one of the better neighborhoods or found at the Volunteers of America thrift store while shopping for presentable second-hand clothes.

    Trust me. I know this from personal experience.

    I said this a little down the roll, but I’ll repeat it. We are becoming two Americas–one with discretionary income and insulated from economic downturns, and the other without discretionary income bounced from truly flush times sustained by working so much overtime that you hardly do anything else [even sleep] to truly bad times in the unemployment line, flipping burgers, or working at Wal-Mart, and in all three cases on Food Stamps, Home Heating Assistance, and [if you're lucky] Medicaid.

    That is the real American underbelly and not “selling apples on the street”.

    And the real outrage and tragedy is that, by and large, the wall between these two Americas has steadily gotten higher and thicker.

    It is still possible to climb over it. But it is becoming slightly less possible to do it with every passing year. And even “slightly less” accumulates into something significant given enough time.

  • Jean

    If you all are talking about areas where manufacturing jobs (especially car-related) are drying up, the economy is bad and getting worse. The only jobs that are increasing seem to be service-industry, like nursing.
    .
    But I don’t blame Bush or Clinton or whoever comes into office as this slide continues. There is simply a larger profit margin if you import and mark-up Chinese goods than if you buy American. It’s cheaper to outsource than it is to hire local people full-time.

  • Jean

    If you all are talking about areas where manufacturing jobs (especially car-related) are drying up, the economy is bad and getting worse. The only jobs that are increasing seem to be service-industry, like nursing.
    .
    But I don’t blame Bush or Clinton or whoever comes into office as this slide continues. There is simply a larger profit margin if you import and mark-up Chinese goods than if you buy American. It’s cheaper to outsource than it is to hire local people full-time.


CLOSE | X

HIDE | X