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Politics : PRESIDENT GEORGE W. BUSH -- Ignore unavailable to you. Want to Upgrade?

To: gerard mangiardi who wrote (174978)	8/27/2001 4:56:23 PM
From: CYBERKEN	Read Replies (2) \| Respond to of 769670

See the Reagan boom. It made Clinton look good. The voice of sanity is Lawrence Lindsey. Will anyone listen? <<Bush Aide: Recession Might Justify Tapping Surplus By Caren Bohan WASHINGTON (Reuters) - A senior adviser to President Bush said on Sunday a recession in the U.S. economy might justify use of Social Security surplus funds to stimulate growth. ``If we had two quarters of negative economic growth, my recommendation to the president would be that he might consider it,'' White House economic adviser Lawrence Lindsey told Fox News Sunday. Appearing on a series of talk shows, Lindsey elaborated on a comment made by Bush on Friday in which he listed two types of ``emergencies'' that might warrant tapping into Social Security funds that Democrats and Republicans have declared off limits. ``I've said that the only reason we should use Social Security funds is in case of an economic recession or war,'' the Bush told a news conference near his Texas ranch. WORRIED ABOUT 'PALTRY' GROWTH Speaking on Sunday in West Mifflin, Pennsylvania, the Republican president expressed concern about the economy. ``I'm upbeat, my spirits are high, but I must confess I'm worried about the fact that our manufacturing sector and our economy is a lot slower than I would hope,'' Bush told workers at a U.S. Steel company picnic. ``As a matter of fact, our economy has grown at a paltry 1 percent for the last 12 months and that worries me,'' he said. Although the U.S. economy has slowed sharply over the past year, it appears so far to have narrowly skirted a recession, which economists loosely define as two quarters of falling gross domestic product (GDP). But analysts say figures due out on Wednesday could raise new questions about whether that definition of a recession might be met. The Commerce Department, which previously said GDP grew by 0.7 percent in the second quarter, will issue revised GDP figures for the April to June period. Economists in a Reuters survey projected that the second-quarter GDP number would be revised to show zero growth. Several analysts have said it could even show a quarterly contraction for the first time since the beginning of 1993. But Lindsey said a negative number for the second quarter alone would not be reason enough to delve into Social Security funds. ``Generally having one quarter of negative growth has not been considered a recession,'' he said. Lindsey said he thought the upcoming number would not be negative: ``I think it will be somewhat less than 0.7 percent growth but still positive.'' ``I don't think we're in a recession,'' Lindsey added. The White House's highlighting of a recession as a possible exception to the pledge to preserve Social Security surpluses follows the release last Wednesday of the Bush administration's updated budget forecasts. Wednesday's report, issued by the White House Office of Management and Budget (OMB), showed the surplus in the federal budget would be all but eaten up in the fiscal year 2001 that ends in September. DWINDLING SURPLUSES OMB's ``mid-session'' budget review showed the surplus to be about $158 billion in fiscal 2001. But it said the surplus excluding Social Security and the Postal Service would only be about $1.9 billion. The $158 billion estimate is well below the $281 billion surplus the White House projected in April. In 2002, the White House forecast that Bush's proposed budget could be accommodated without dipping into the Social Security surplus but, again, the cushion would be slim. Analysts believe that figures from the Congressional Budget Office, expected on Tuesday, could show an even darker fiscal picture, suggesting the government is, in fact, in danger of dipping into Social Security funds. Democrats have blamed Bush's $1.35 trillion tax cut for whittling away the surplus and have said it puts Social Security and Medicare surpluses at risk. ``Let's be frank. When the surplus in Social Security is backed out of the budget, as it should be, there is no surplus,'' Rep. John Spratt of South Carolina, ranking Democrat on the House Budget Committee, said in a radio address on Saturday. Spratt said Democrats were ``ready to work with the president to put the budget back on even keel.'' Sen. Pete Domenici, interviewed on CNN's Late Edition on Sunday, joined Bush and Lindsey in suggesting the needs of a slowing economy might in some cases demand a higher priority than fiscal austerity. But the Republican from New Mexico went a step further in saying that not only should the tax cut remain in place but also spending should not be cut. ``The tax cut is perfect. Leave it alone and just look at it for a while,'' he said. ``In addition, I would not even be on the side that says cut spending.''>>

To: gerard mangiardi who wrote (174978)	8/27/2001 5:04:02 PM
From: Neocon	Read Replies (1) \| Respond to of 769670

Actually, it was a supply- side recovery, not Keynsian. The evidence? In a demand driven economy, the rate of inflation goes up, as more dollars chase a lagging production of goods and services. In the '80s recovery, the rate of inflation went down, as one would expect when increased production of cheaper and improved goods and services was stimulating a lagging demand. Second, Bill Clinton barely raised taxes. The marginal rates still did not exceed 40%, and therefore any suppression of growth was modest.