Bush Gets the Economic News He Was Waiting For
President Bush got the terrific economic news he was hoping for today, when the Commerce Department reported that third quarter GDP jumped 7.2%, and first time claims for unemployment dropped another 5,000 to a seasonally adjusted 386,000. Experts feel that the GDP increase was spurred onward by sharp jumps in business investment, consumer spending, and residential construction, and credit Bush’s third tax cut and low interest rates for the improvement. But all caution that businesses will still wait for a quarter or two to make sure the rebound is solid before beginning to hire again.
Bush and the GOP want to pour more cash onto the bottom line of their campaign contributors by passing another round of tax cuts for businesses. The tax bill making the GOP rounds in Congress right now is already being larded up with every lobbyist’s wish list for Corporate America, and one could argue that this bill is now not needed given the growth figures today. Moreover, the tax breaks once again are apparently being handed to Corporate America without any accountability for actually creating domestic jobs with the reduced taxes.
Slate’s Daniel Gross warns of not being too “rosy scenario” with the GDP numbers until we see several quarters together of solid growth coupled with ramped-up hiring. Although Gross is correct in his caution, these numbers allow Bush and Rove to play the perception game with the media and voters heading into the election season next year by selling them that we are on the right track. Sure, the millions of jobs lost in the past three years won't show up between now and next November. But Rove can spin this for at least a quarter that if you only re-select Bush, the jobs will get here eventually, especially if we cut taxes even more.
The question is whether or not the ongoing lack of significant hiring, coupled with increasing worries about Iraq will keep voters from swallowing whole what Rove will be dishing. And the answer to that question simply put will dictate what happens next November.