A weekend "Think Piece" from the "Times." Tough to kick Bush out with the economy on the upswing.
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How to Recover From a Bad Economy, and Win
By RICHARD W. STEVENSON
WASHINGTON — Lucky is the president who gets his recession out of the way early. Richard M. Nixon and Ronald Reagan presided over sharp economic downturns in their first terms, but could point to a year or two of declines in unemployment by the time they faced the voters again. Both coasted to re-election. Jimmy Carter in 1980 and George H. W. Bush in 1992 were saddled with jobless rates that peaked only months before Election Day, and were tossed out of the White House, even though, in Mr. Bush's case, the overall economy was recovering nicely.
For the current President Bush, a keen student of what happened to his father, the prospects for re-election may rest to a substantial degree on whether the economic woes of his first three years in office give way fairly quickly to a palpable sense that prosperity has returned, or soon will.
After a recession, a long period of sluggishness and growing concern about swelling budget and trade deficits, the economy is now getting back into high gear, a little more than a year before Election Day. Just last week, consumer confidence ticked up, new claims for unemployment insurance edged down, housing construction surged and industrial production increased. Stock prices hovered near 16-month highs. Analysts increased their estimates of economic growth over the summer and for the last three months of the year.
Statistics are one thing; voter perception is another. That perception is shaped more than anything by jobs, or the lack thereof. Defying traditional patterns, this recovery has yet to generate sustained improvement in employment, after two and a half years of steady losses — 2.8 million jobs, as the Democrats point out at every opportunity, the worst record since Herbert Hoover. Among members of both parties, there is a strong sense that Mr. Bush's political fortunes could turn largely on whether the labor market finally begins showing marked gains over the next nine to 12 months, a question on which economists remain divided.
There are positive signs. The economy added 57,000 jobs in September, the first gain after nine months of losses. The unemployment rate has slowly declined from a peak of 6.4 percent in June, and while the current level of 6.1 percent is two percentage points above where it was when Mr. Bush took office, it is still relatively low by the standards of the 1970's and 80's.
"If jobs are coming back at a healthy clip, the president will be in relatively good shape," said Robert B. Reich, the labor secretary under President Bill Clinton. "But if job growth is anemic, he's in trouble."
If job gains don't continue, Mr. Bush could be stuck. By pushing three tax cuts through Congress in three years, he has already taken his best shot at stimulating job creation, and the deficit will make it hard for him to push through further reductions.
Given how little he can affect employment between now and Election Day, Mr. Bush finds himself among those presidents who have been faced with the challenge of putting the best face on the economy without appearing detached from the angst and, in some cases, the suffering it has generated among workers.
Some White Houses in the past have succumbed to the temptation to make unrealistically optimistic forecasts, as the Reagan administration did early in its first term. Others have allowed the opposing party to define the economy in simple, negative terms, as Mr. Bush's father allowed Mr. Clinton to do in 1992.
The Bush administration is determined not to fall into those traps. Almost every day, the president says progress is being made but that he will not be satisfied until every American who wants a job can get one. "You have to be realistic about present circumstances," said Michael Boskin, chairman of the Council of Economic Advisers in the first Bush administration. "You also ought to be optimistic about the future, about our strong economic system and its ability to adapt. And you've got to talk about what you've done to make things better. President Bush has done a pretty good job of that."
Assuming the economy remains in a gray area between strong employment growth and a renewed downturn, Mr. Bush's advisers say he intends to stick with the message he has been trying out on the stump for the last few months: by cutting taxes he took decisive action, in the face of an array of negative forces beyond his control, to counter a downturn that was getting under way before he even took office.
"Job growth is an issue, but there are two things President Bush will benefit from," said Representative Rob Portman, an Ohio Republican. "People have a more sophisticated understanding of the economy, and don't expect miracles from fiscal policy or monetary policy from here in Washington. Second, there's a realization that he has pushed hard to do something about it."
Mr. Bush's aides are confident the economy will break their way. If not, the results of the 2002 midterm elections, when Republicans picked up seats despite the weak economy, suggest that the political pain inflicted on Mr. Bush might not be as dire as that suffered by his father. But Republicans aren't taking any chances.
"It's still jobs, jobs, jobs," Rick Santorum of Pennsylvania wrote this month to his Republican colleagues in the Senate. Setting out the party's communications strategy, Mr. Santorum wrote: "We must talk about our commitment to create and protect jobs. Every one of us needs to drive the message that 57,000 new jobs were created last month as a result of the tax cuts we passed to stimulate the economy."
Intent on taking — or at least being seen to take — further action, Mr. Bush has repackaged his existing domestic proposals, many of which are stalled on Capitol Hill, as efforts to create jobs. At nearly every public appearance, he suggests that encouraging more oil and gas drilling in the United States, limiting lawsuit awards and providing tax incentives to businesses for providing health insurance will help spur more employment.
None of those ideas, if enacted, would be likely to bring quick results, if they helped at all. But in this case, perception may be the thing that matters most.
nytimes.com |
