Americans believe the economy is in a recession. But is it true?
Just how bad is the U.S. economy? Who's asking? More important, who's answering?
The conventional wisdom is not always wrong. But because it depends so much on emotion, it can often mislead. As a result, it is in times like these that economic fundamentals become so important. Rather than dwelling on the bad news coming from the financial and housing sectors, we believe it is important to look at the underlying drivers of the economy. And those look very solid.
Back in 2002-03, the household measure of civilian employment was much stronger than the payroll survey, signaling economic recovery. However, at the time, many prominent economists, including Alan Greenspan, (wrongly) argued that the payroll survey was right about the economy, not the household survey.
Then, in late 2007, the household survey was weaker than payroll growth, signaling slower growth and gaining some adherents now that it was showing weakness. But in the past few months, the household survey -- which we have followed closely all along -- has turned up strongly. In the first four months of 2008, when the payrolls survey shows a loss of 65,000 jobs per month, the household survey shows a gain of 179,000 per month.
Look for more positive economic data in the months ahead, as the most predicted recession in U.S. history never comes to pass.
As of spring 2008, we're probably just a third of the way through the unfolding debacle in the housing, credit, and financial markets. In political and regulatory terms, the ultimate problems and remedies have only begun to define themselves.
We're not just looking at an ordinary recession. Since the 1970s, the United States has redefined itself from a manufacturing nation to a financial economy built on debt, leverage, and a considerable ratio of speculation. Both political parties have been complicit in this, and the downturn now beginning will be unusual and potentially tragic.
The lesson of history is that previous leading world economic powers, from Rome and Imperial Spain to the Netherlands (back when New York was New Amsterdam) and early 20th-century Britain, have been unable to reform themselves in time to avoid decline. Politics has failed in the face of entrenched interests. In the process, excessive debt and dependence on finance rather than production has been front and center. New nations move to the head of the line -- and these days we can see Asia smiling.
Barack Obama chows on a burger with some supporters in Muncie, Ind., just like a regular guy.
Democratic presidential candidate Barack Obama, known for his skills as an orator, conceded today that comments he made at a private San Francisco fundraiser about working-class Democrats clinging to "guns or religion" were poorly chosen.
Barack Obama's condescension reveals a man out of touch with the rhythms of American life to a degree that's hard to fathom. As Michelle says, they "chose" to "leave corporate America", and Barack became a "community organizer" and she wound up a 350-grand-a-year "diversity outreach coordinator". I've no idea what either of those careers involve, and most of us seem able to get along without them. But their remoteness from the American mainstream perhaps explains why the Obamas seem to have no clue how Americans live their lives.
And yes, I'm a foreigner. But it takes one to know one.
It's worth saying that I'm not defending Obama here. I see nothing that he needs defense from. There's no actual attack being levied that anyone can rebut, or ideas being tossed out that anyone can argue. Instead, Obama has said something Politically Damaging. And it will Damage him. And we'll all watch to see how badly.
But let's be clear: It's not damaging because we think it foretells him doing something harmful to the country. It's not damaging because it suggests his policy agenda is poorly conceived, or his priorities are awry. It matters only because it matters, not because it means anything about Obama, or illuminates anything about his potential presidency. It's a hollow scandal.
A common sight?
Americans' views on the economy and the general state of the country have hit an all-time low in the history of the CBS News/New York Times poll. Eighty-one percent of those polled say the country is on the wrong track, while only 14 percent believe it is heading in the right direction. Are things really that bad?
Here’s the thing to bear in mind about a survey saying 81 percent of Americans think the country is on the wrong track: Not everyone agrees what track that is.
Some people will say the country is going to the dogs because of the war in Iraq and an incompetent president.Others will point out America is going wrong by not deporting all illegal immigrants and erecting a Great Wall of Texas.
It's just really difficult for me to imagine the incumbent party holding onto power in the face of an unpopular war and a bad economy. Count the fact that 81 percent of voters think the country is on the wrong track as further evidence along those lines.
Given the prevailing mood, it seems obvious that the average voter is going to want to vote for a candidate who can credibly promise that he'll pursue substantially different policies from those of George W. Bush. But McCain has promised to follow Bush on Iraq, promised to follow Bush on taxes, promised to follow Bush on housing issues, and shows no sign whatsoever of even understanding why people are frustrated with Bush. So how's he going to win?
Hand-in-hand in the nation's heart.
It's hard to believe that any politician could be more unpopular than President Bush: The new AP poll puts his approval rating at 30 percent. But Congress does worse -- only 22 percent of Americans approve of its performance.
Why are Americans so discontented with our leaders? What can be done to make them content?
The past year gave voters a good look at the Democratic primary challengers, a thoroughly inexperienced lot. Given that the three Democrats with any chance of winning the nomination comprise less experience in national office combined than John McCain and no executive experience at all, some disenchantment may have set in with voters. It certainly doesn't give Democrats a reason to think that they have momentum for a general election -- in fact, this survey shows the opposite.
After losing their first national election in four cycles in 2006, it looks like Republicans could rebound in 2008. They have the momentum, and they have closed the gap almost to where it was in November 2004. A few more months of Democratic incompetence in Congress could close the gap altogether.
Congress is so unpopular, particularly among Democrats, because of their ongoing capitulations to the Bush administration, their failure to place any limits on his Iraq policy, and their general inability/refusal to serve as a meaningful check on the administration. Democrats and independents overwhelmingly dislike the President. Thus, the weaker Congress is in defying the President, the more unpopular Congress becomes.
Contrary to the general impression created by the media when discussing this polling data, Congress' extremely low standing does not undermine or dilute the intense unpopularity of Bush and his party among Americans. To the contrary, it bolsters it and arises from it.
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