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Politics : John Kerry for President Free speach thread NON-CENSORED -- Ignore unavailable to you. Want to Upgrade?

To: American Spirit who wrote (893)	7/16/2005 3:30:55 PM
From: StockDung	Read Replies (1) \| Respond to of 1449

Bush, confounding critics from 2004 race, enjoys robust economy Posted online: Saturday, July 16, 2005 at 0000 hours IST JULY 15: US President George W Bush, confounding predictions by opponents in last year’s presidential campaign that the US economy was headed for trouble, is instead basking in its improved performance. Thanks in part to Bush-proposed tax cuts and to interest rates engineered by another Republican, Federal Reserve Chairman Alan Greenspan, the economy is growing at a near-ideal pace of 3 percent to 3.5 percent, while inflation is continuing at a low 2.5 percent and the US is gaining an average 180,000 jobs a month. Even the US budget deficit, which Democrats warned last year was growing out of control, is turning out to be smaller than projections earlier this year had suggested. ‘‘The economy is in pretty good shape,’’ says Alan Blinder, a former Fed governor who was one of Democratic presidential nominee John Kerry’s economic advisers in last year’s campaign. ‘‘I give the president a modest amount of short-term credit.’’ Kerry said during the 2004 campaign that it appeared Bush would be the first president in 72 years ‘‘to lose jobs’’ during his administration. Job growth last year enabled Bush to avoid that distinction by the end of first his term in January, and the economy has ended up creating more than a million new jobs so far in 2005. Still, some economists say the positive economic developments may be too good to last. Democrats including Blinder contend Bush’s policies have exacerbated potential vulnerabilities in the economy, such as speculation in the housing market, an outsized US trade deficit, slow wage growth and no room for more tax cuts, all of which could threaten prosperity in coming years. Signs of froth Greenspan told the congressional Joint Economic Committee in June there were ‘‘signs of froth’’ and ‘‘speculation’’ in some local housing markets that were ‘‘rising to unsustainable’’ levels. ‘‘The economy looks reasonably solid in the short run, but shaky in the long run,’’ Blinder said in an interview. Bush, grappling with such problems as the Iraq insurgency and the unpopularity of his plan to overhaul Social Security, hasn’t been shy in taking credit for the economy’s performance. ‘‘Our economy is strong, and it’s a sign that our tax- relief plan, our pro-growth policies, are working,’’ he said after a Cabinet meeting July 13. ‘‘We can be pleased that the economy is on a good and sustainable path,’’ Treasury Secretary John Snow said in an interview yesterday. Budget deficit The Office of Management and Budget reported this week the deficit for fiscal 2005, which ends Sept. 30, is likely to be $333 billion, down from the $427 billion forecast five months ago. Even the reduced forecast would be the third-biggest US deficit ever. Economists at Goldman, Sachs & Co. say they are skeptical that the budget deficit will continue to improve because part of the surge in tax receipts stems from ‘‘less-sustainable factors,’’ including a strong rebound in stock prices, that won’t necessarily be repeated in coming years. Bush proposed a series of tax cuts between 2001 and 2003 that together totaled $1.85 trillion over 10 years. Tax receipts have been unusually strong this year as employment expands and more individuals become eligible to pay the alternative minimum tax. The Fed slashed its benchmark overnight lending rate to 1 percent in mid-2003, from 6.5 percent in December of 2000, in order to counter the 2001 recession, sparking more borrowing by businesses and consumers — and increased spending that helped spur the recovery. — Reuters financialexpress.com