US data hit Bush's hopes

[frustrated_lefty]

David Teather in New York
Saturday September 13, 2003
The Guardian

"The United States economy stumbled again yesterday with the release of crucial retail sales, consumer confidence and inflation data that were uniformly worse than analysts had been expecting.
According to the US commerce department, retail sales rose by 0.6% in August, well below Wall Street forecasts of 1.4%. In July, retail sales grew at a far brisker rate of 1.3%.

The figures will be a blow to the White House - consumer spending accounts for two-thirds of US economic activity and the Bush administration hoped that tax cuts and rebate cheques arriving in the post would give the limping economy the boost it needed.

Consumer sentiment dipped in early September as the nascent recovery continued to fail in creating jobs."

more: http://www.guardian.co.uk/usa/story/0,12271,1041365,00.html

[ewagner]

1. Just F**king wonderful

...and nobody, and I MEAN NOBODY, in this administration has a clue about how to repair the economy.

The conservatives have just three solutions for everything, Tax Cuts, tax cuts ,tax cuts.

They don't understand that something is structurally wrong here and needs to be addressed by the highest levels of government. This is not the normal business cycle and things won't pick up by themselves. This situation requires something entirely foreign to Conservatives and this administration: CREATIVITY!

[PartyPooper]

2. But, but, but, President George W. Bush has an MBA from Harvard.

Doesn't that count for anything?

:eyes:

[underpants]

22. Didn't the Repubes used tocrow that those liberal bastions inflate grades?

Oh except for an earnest and hardworking legacy like their guy W. He probably got his grades marked down because his family were New England liberals carpetbagging in Texas and acting like moderates.

Molly Ivins says there is an old joke in Texas:

At the chili cookoff how do you know which entry is from the Bushes?

It's the one with Maine lobster in it.

[myomy]

38. It sure does degrade having a MBA from Harvard doesnÕt it?

Wonder if you can just go in and buy one?

[MoonRiver]

39. Might have, if his poppy hadn't bought it for him.

Instead there's a total :dunce: managing the US economy:

[yella_dawg]

40. MBA

Master of Bumbling Apathy
Master of Bumbling Antagonism
Monky Boy A**hole

[Whoa_Nelly]

45. MBA

with a C- grade average. Dimbo sat in the back so he wouldn't have to be called on, and slept through most of his classes. He also missed a lot of classes. Probably paid people to write papers, do homework for him so he could party on booze and cocaine.

[frustrated_lefty]

3. Creativity isn’t the issue.

I don’t think we need to be looking for a genie in a bottle to settle our economic woes.

We need a simple, responsible policy. Revoke, or phase out the tax cuts across the board. Severely punish corporate mismanagement and deception along the lines of the Enron scandal. Develop and present a comprehensive, realistic policy describing the role of America in the Middle East. These things, I think, would collectively restore world perception of the US as an essentially responsible nation, along with removing tens of billions from the projected national deficit.

Repairing world perception of the US is key, though. The reason the US can run at a deficit is because foreign nations are willing to buy US bonds. They buy US bonds because the US is perceived, broadly, as a fiscally responsible nation. That perception is changing under the Bush administration. If foreign nations begin to call in those debts, we’re screwed. And, they will begin to call in those debts if there isn’t a dramatic shift in American policy.

We don’t need creative solutions to the economy, nor do we need a magic bullet. We need to sit down and go through the mind-numbingly boring, non-flashy task of figuring out a fiscally responsible course of action and pursue it. We need to establish priorities that will actually be provided the support they need to succeed.

The neocons just aren’t up to the job, it seems.

[Gunit_Sangh]

10. re: "Creativity isn’t the issue."

<The reason the US can run at a deficit is because foreign nations are willing to buy US bonds. They buy US bonds because the US is perceived, broadly, as a fiscally responsible nation.>

I'm sure this has been discussed on du before, but check this link out. I've seen this article at different places. This is the first place I found when I searched google.

http://www.ratical.org/ratville/CAH/RRiraqWar.html

It discusses why the U.S. can really run huge deficits ... other countries have to buy U.S. dollars to buy oil from opec. And since they have to have dollars for oil, they keep dollars for other international transactions.

Saddam actually switched to euro's somewhere around 2000 to make a political statement. He actually ended up making out like a bandit cuz the dollar dropped in value and the euro gained and he ended up making millions on the switch.

If opec were to switch to euro's .. this article states the dollar could drop 20-40% virtually overnight. The great depression would look like easy times if that happened.

Heck .. geedubya might even have to raise taxes on his wealthy buddies.

GOOD GOD MAN .... CAN'T YOU SEE THE CRISIS!!!!!!!!!!!!!!!!!

[Vitruvius]

16. And one reason Bu$h invaded Iraq is that Saddam switched to the Euro --

as you point out, "If OPEC were to switch to euro's .. this article states the dollar could drop 20-40% virtually overnight...."

Yes, the primary reason for the invasion was to steal Iraq's oil -- but a close second was to punish Saddam for switching to the Euro and to intimidate the rest of OPEC into sticking with the dollar.

The Bu$h economic plan is theft -- theft from the middle class & poor at home; theft from the third world abroad.

Vitruvius

[StandWatie]

32. neo-cons always say a weaker dollar is good for the economy

Maybe deep down they don't really believe their bullshit, but that's always the spin I've got from their economists.

[calimary]

48. They wouldn't say that if a Democrat were in the White House.

They'd be rending their garments and gnashing their teeth about how reckless and irresponsible it was.

[frustrated_lefty]

37. Thanks for the link and the explanation.

I never really paid much attention to the economy until a few years ago, and have come to the conclusion it's a decidedly complex issue. Trying to figure out how the US runs with its deficits...is like reading Kafka.

[yella_dawg]

41. I've run across this economic theory before..

It makes sense, but what I'm wondering about is the income to the US from the Treasury's half interest in the IMF. You know, the guys who have been getting hit by defaults in South America? I have this idea that we can run infinite deficits as long as the IMF and World Bank keep fleecing third world economies. But when all the third world nations are bankrupt, we suddenly pull up short. I don't know how valid this idea is, I'm just looking for a way to figure out where all that double-digit interest is going.

[scsifreak]

11. Actually, that's not quite true...

Repairing world perception of the US is key, though. The reason the US can run at a deficit is because foreign nations are willing to buy US bonds.


The reason the USA can have a trade deficit so out of whack is because of OPEC. All international oil transactions are only performed in USA dollars, and that virtually forces all oil importers to sell to the USA directly, or sell to another, who themselves sell to the USA to acquire US dollars. This creates a large steady influx of foreign goods that creates the trade deficit. America has become drunk on cheap imports and there really isn't much that can stop it.

Iran might be the ace in the hole considering Washington is going to 'Iraq' Iran by telling them they must prove they don't have a WMD program. If Iran tried selling oil in other currencies, OPEC as a group will certainly come in and attempt to drive Iran out with cheap oil. OPEC will certainly try to protect the value of their accumulated assets. They would probably be the biggest group of losers of an oil market that actually provided choice to buyers...


We don’t need creative solutions to the economy, nor do we need a magic bullet. We need to sit down and go through the mind-numbingly boring, non-flashy task of figuring out a fiscally responsible course of action and pursue it. We need to establish priorities that will actually be provided the support they need to succeed.


Sadly, that will never occur. We live in a society that requires quick-fixes. We have a point-and-click remote-controlled microwaveable disposable society addicted to convenience. People will never be drawn towards involved solutions because those with power will put forward plans that require as little work from the people as humanly possible, and people, like electricity, will follow the path of least resistence.

[are_we_united_yet]

15. Good post n/t

[w4rma]

5. The reason isn't not a normal buisness cycle is because of free trade

Factories are moving overseas. Companies with factories here are going out of buisness. Engineering and accounting contracts are being outsourced to India.

America cannot compete in a global economy using free trade rules.

[bearfan454]

27. No shit !

But unfortunately it is all part of their plan. Totally tank the economy and when people are extremely desperate for money for food, then they will accept anything the government gives them. Even a low wage job because it is better than nothing. That helps the corporations make more money. They want it where all the rich people own all of the companies and we all work there for them at about 7.00 an hour. That is what they want.

[chapter32]

30. Question:

How will rich corporations maintain their wealth if we can’t buy their products because “we all work for them at about 7.00 an hour”?

Thanks.

[SammyWinstonJack]

36. I was wondering the same thing

:shrug:

[reprobate]

47. That's the fallacy of uncontrolled capitalism.

Or should I have said 'uncontrolled corporatism'?

The ceo will always try to minimize labor costs. His goal is to bring labor costs as close to zero as possible.

We can already see this taking effect. Just look at those making minimum wage, or even close to it. They can't even buy shelter and food at the same time. The ceo's goal is to make sure we are all in that position.

[sendero]

29. I think that is a factor...

... but not the whole story. Our economy is suffering a confluence of maladies that seem to have all reached the boiling point at nearly the same time.

While I do not blame the Big Dog for the "overheated" late 90s, the .com and telecom crashes were the catalyst for the recession.

But normally we would be well out of it by now. Free trade is one reason we're not, but IMHO the fact that consumers are just tapped out it a bigger one. There is too buch debt in the country at every level, consumers and government.

Few have money to spend and most that do are hunkering down. This exascerbates the employment problem and creates a downward spiral. A spiral that better be broken soon or we are all in for a long decade of pain. :(

[Gore1FL]

49. I disagree

"America cannot compete in a global economy using free trade rules."

I don't buy that. I will buy:

"America cannot compete in a global economy using current free trade rules that do not address workers rights.

That is the rub. Free trade in and of itself is a good thing. One need only look at the free trade between the States, the European Union, etc to see the positive effects of Free trade.

The worker, however, is taken into account in (perhaps inadvertantly) in both scenarios.

[prolesunited]

7. You're assuming they actually want to repair the economy

Frankly, I think the have the economy that they want. Think about what the job market was like four years ago. Companies competed for top employees, had to offer good raises, perks, bonuses. Quality employees had the power. If they didn't like the way they were treated, they could tell the boss to shove it and land a job the next week.

Now where are we. It's now an employer's market. Bosses don't have to offer raises or perks. If you dare to complain, the boss reminds you that you are lucky to have a job. Desperate people will work longer hours for less money.

They point to productivity being up as an indication of a rebounding economy. All this means is that they are putting out less money to produce the same product, meaning workers are getting screwed. Did you notice stocks are going up as well. Look how many jobs have been shed, again increasing profits.

This is the economy they want because it is allowing them to consolidate the wealth once again in the hands of the few.

BTW, the tax cuts have nothing to do with spurring the economy. Rather, their goal is to bankrupt the federal government so they can get rid of those pesky social programs once and for all.

[sandnsea]

9. A happy 6%

Isn't that what they tried to sell as full employment before Clinton, unemployment would never fall below that number again. Not as long as a Republican is in office it won't, it's just where they want it to be. The long, painful years of Reagan return.

[underpants]

23. Absolutely on the mark!

Oh and don't think that the old money had nothing to do with devaluing the dot comers stock options. They hated people falling into money when they had to work so hard to inherit it.

It is an employers market indeed.

[bearfan454]

28. I have thought that for a long time.

What quicker way to get rid of Social Security than to bankrupt the federal government ? And his buddies keep getting richer all the time.
On our money too that we would have gotten when we turned 65. I'm 47 and I don't think I will get Social Security. Do you guys ?

[salin]

31. Krugman agrees with you.

http://www.nytimes.com/2003/09/14/magazine/14TAXES.html?pagewanted=1

DU discussion: http://www.democraticunderground.com/discuss/duboard.php?az=show_topic&forum=104&topic_id=328979

[prolesunited]

33. I'm sure it is I

who agrees with Krugman. ;-) Thanks for the links! I'll check them out. :hi:

[underpants]

21. Problem is there is nothing left to cut, that well is dry

Like all the oil wells W drilled in his...lessee....three failed oil businesses.

Any politician knows you always keep something in your pocket to "give" again. I think W&Co. are so believing their press clippings that they are immune to criticism.

[The Zanti Regent]

24. But, Rush says the economy has NEVER been Stronger!

and Andy Sullivan repeatedly ridicules Paul Krugman, Andy also says the economy will be soooooooooooooooooooooooo much better when those tax cuts kick in for the rich.

These idiots live in their Lasseiz fairyland!

[underpants]

25. He also said tha Lawyer Malloy wouldn't help the Bills defense

Welcome to DU :hi:

[July]

26. Yeah, GO BILLS!!! eom

[LiberalFighter]

44. No no no no... that is wrong... their solutions are...

Tax cuts for the rich, Tax cuts for the rich, Tax cuts for the rich, and more Tax cuts for the rich

Oh and don't forget the Estate Tax elimination for the wealthy

[teryang]

4. dumping billions overseas in a futile war

...isn't too helpful. In fact, the rather apparent incompetence if not outright malfeasance of the junta leadership does nothing to inspire economic confidence. The fact that they have no economic policy other than enriching themselves at the average persons expense is pretty damn obvious at this point to most people. It isn't just a few corrupt corporations, it is a way of life for the new order. That the mainstream media accepts the daily litany of obvious whoppers without contest further demoralizes the average consumer.

[Barrett808]

34. Oh, but check out the conservative spin: "fork over a few bucks"

Firing Up The Liberal Spin Machine
By Rachel Marsden on 09/12/03

You'd think that somewhere in America, a major cafeteria that caters to liberals had just run out of chocolate milk. A mere six months into the "Iraq phase" in the war on terrorism, liberals are already whining about having to fork over a few bucks to do the job that Bill Clinton neglected for 8 years as Osama bin Laden ran around bombing embassies and American warships like he was the bad guy in a Bruce Willis movie. Meanwhile, countries like Iraq and Afghanistan--run by ruthless, despotic regimes--were thriving as breeding grounds for extremists.

(more)

http://www.democraticunderground.com/discuss/duboard.php?az=show_topic&forum=103&topic_id=10968

[teryang]

46. Absurd isn't it?

Healthcare is a boondoggle? I don't know many Americans over fifty who feel that way about it. In fact, I don't know any regardless of their political stripe.

My count has the 911 knee jerk response at 118 billion in the first few months for airlines, homeland security bullshit, and increased defense budget. Then we get the phony Iraq security problem which now chimes in at over 150 billion in appropriations and we are only several months into the conflict. The oil will not flow. Arakis will not serve the Harkonens. The price tag is already over a quarter of a trillion dollars going down a rathole. I'm sorry, which is the boondoggle?

Of course the damage to the economy at large caused by this junta's belligerence, represssion and irrationally aggressive policies is actually inestimable and far beyond a quarter of trillion in impact. Aggression, fear, and oppression do little for commerce although it does enrich Bechtel, Halliburton, Dyncorp, Carlysle and the crony corporatists who are looting the treasury and the nations future. Who's running the country? Mussolini?

[sham]

6. we all saw this coming.

According to the US commerce department, retail sales rose by 0.6% in August, well below Wall Street forecasts of 1.4%. In July, retail sales grew at a far brisker rate of 1.3%.

People got their $400 cash advances in July. They then put a little bit toward the bills and spent the rest on school supplies/clothes for the kids. (An occasional idiot bought a car/boat/whatever that they couldn't afford.) And that was that.

None of us here at DU were fooled. We didn't believe these tax cuts would create jobs. I don't remember a single post by someone who believed that once the money was spent, there would be more jobs.

I'm no expert, and I understood that. Why are the Neocons acting like they don't understand that? Do they think we are that stupid? I'm not a big tinfoil aficionado, but I'm beginning to think that they are LIHOPping the economy.

[radfringe]

12. the child credit checks, like the "rebate" checks

were a one shot deal and not something people will get every year

if you look at retail sales etc. for periods between February and May of any year, sales will be "up" due to the regular income tax refund checks

so it's not surprising to see "up" numbers during the timeframe when the bribe checks arrived

[newyorican]

8. not as easy to talk up...

as it is to talk down, is it?

Is this the bottom that Nader wanted to get to so badly?

[0007]

13. John Snow & Don Evan are dead fucking wrong

All that hype and stumping.

[are_we_united_yet]

43. They aren't even trying to be right.

They the spin machines for *'s evil plot to ruin the Country.

[cthrumatrix]

14. not to worry...the govt will prop up the stock market ....until

it can't. In the meantime our treasury will have been plundered and the printing presses will make the dollar worth much less than now.

[saigon68]

18. GO TO EUROPE TO SEE THE REALITY

I was there 3 weeks ago. The dollar has declined 40% compared to the Euro over the last 2 years.

[amberdisc]

17. Some grim reading

from a contrarian investor. This article lays out what he fears for the economy and how too prepare.

Thinking the unthinkable

[radfringe]

19. shudder

my first instinct was to NOT read the article, just bookmark it for later and stay in blissful ignorance and denial for the weekend..

but I didn't and now I'm :scared:

[bahrbearian]

20. Good Link

I like the housing Bubble part, add on to that the rising price's of Lumber. Lumber prices have started to go throw the roof OSB and Plywood have nearly doubled...

[are_we_united_yet]

42. I'm depressed n/t

[Gloria]

35. Another tidbit from an article I picked up

for a recent World Media Watch...the Russians and Saudia Arabia have signed agreements--old news--but the new info is that SA has $600-800 BILLION here in the US and the bet is they'll be ready to pull it out for investing in Russian oil/gas facilities. SA and Russia are nos. 1 and 2 in terms of production....