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A Daily Chronicle of Bush Administration Distortion November 5, 2003

     

Bush Touts Economic Numbers, But Less Rosy Reality Lies Beneath the Surface



President Bush toured a manufacturing plant in Alabama Monday, touting the success of his tax cut policies. "I went to the Congress, not once, but twice, and said, in order for people to be able to find work here in the country, let's pass meaningful, real tax relief."1 But the President's policies have thus far not resulted in jobs--since his first tax cut passed in 2001, the economy has lost a net of 2.75 million jobs.2

The president claimed that his 2003 tax cut, worth $550 billion, would create 1.4 million new jobs over two years.3 The bill which became law, worth $330 billion, was estimated by the President's Council of Economic Advisers to create almost one million jobs over the same period.4 Since passage, the economy has experienced a net loss of jobs every month except September, when the economy added a total of 57,000 jobs, well below the overall targets predicted by the CEA for the second half of the year.5

Even as the administration claimed that the Bush tax cut policies "brought economic activity to a higher level, which increases incomes and living standards for American workers,"6 other economists pointed to figures showing a decline in average hourly earnings as a troubling sign for disposable income.7 Real wage and salary income declined by 1.2% between the start of the last recession and August of 2003, the most pronounced decline 29 months after a recession began since 1959-well below the historical average of 3.5% growth.8

Sources:
  1. Presidential Speech, 11/3/03.
  2. Daily Progress Report, Center for American Progress, 11/4/03.
  3. "The President's Jobs and Growth Plan: Focused on Consumers and Investors," Whitehouse.gov.
  4. "Excerpts from May 6, 2003 Press Briefing," Whitehouse.gov, 5/6/03.
  5. "Excerpts from May 6, 2003 Press Briefing," Whitehouse.gov, 5/6/03.
  6. "Tax Relief Helps Economic Growth," Whitehouse.gov.
  7. "Healthy increase in economic growth is not translating into more jobs," NPR Morning Edition, 10/27/03.
  8. "Economic Snapshots: Still no recovery in wage and salary income," Economic Policy Institute, 10/29/03.



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