By Errol T. Louis
Just when some of us thought the national economic recovery was underway, there’s news that the picture may not be so rosy after all. While a stalled economy won’t necessarily doom President Bush’s re-election chances: it opens the door for Democrats to use the proven message that worked so well for Bill Clinton in 1992: Change vs. No Change.
Like most people – including a lot of stock analysts and economists – I often make guesses about the state of the economy based on a jumble of anecdotal and totally unscientific economic “indicators.” These kinds of intuitive hot flashes would horrify my college and graduate school professors, but I have found them to be helpful and accurate more frequently than not.
While picking up some recycling bags at the Home Depot on Hamilton Avenue in Brooklyn over the summer, I was struck by the percentage of the midday crowd that seemed to be made up of small contractors and homeowners. If homeowners are confident enough to spend cash repairing their brownstones, I figured, recovery must be at hand.
It wasn’t a completely frivolous conclusion: the Brooklyn store is ranked as the top-grossing Home Depot in the nation, and therefore has some degree of broad economic significance. I got further good news last month when a good friend of mine, a Manhattan architect, told me he had his hands full working on jobs from a range of private homeowners and non-profit groups. This same friend had been through hard times after three buildings he was working on were destroyed on September 11, 2001.
Finally, I’ve detected a drop in the number of people begging in the streets between my house and the Nostrand Avenue stop on the A train – at least, the number of such people who don’t appear to be mentally ill. It’s one thing to be approached by a person with an obvious disability, but much more unnerving to see people, and even whole families, who are healthy and competent, but disastrously broke and living on the streets.
So I wasn’t surprised when the Washington Post recently reported that during the summer, “manufacturing output has improved, job losses appear to have stabilized, consumer sentiment has risen and consumer spending has surged.”
That’s great to hear. But the recovery won’t necessarily help the Bush administration. Right now, unemployment is at 6.1%. According to Business Week, unemployment was at 6.8% in March of 1991. That recovery didn’t aid the sitting president – the first President George Bush – because jobs continued to be lost even as the economy struggled to its feet.
By June of 1992, unemployment had surged to 7.8%, Bill Clinton was gaining strength in the national polls by blasting the White House’s policies, and the handwriting was on the wall for the Bush administration.
Paul Craig Roberts who served as an assistant treasury secretary under President Reagan, recently noted that the current Bush administration might pay a heavy price in 2004 for presiding over the loss of nearly 3 million jobs, most of them in manufacturing.
“If this is recovery, what is going on?” Mr. Roberts writes. “I think that the jobless recovery is an illusion and that the U.S. economy is creating jobs – but not for Americans. Those 2.5 million manufacturing jobs have not been lost. They have been moved offshore and given to foreigners who work for less.”
Those foreigners, of course, won’t be voting in November of 2004. And many of the people who do make it to the polls might, understandably, be in a surly mood. “If this analysis is correct,” says Mr. Roberts, “U.S. job seekers will no longer be able to tell the difference between recovery and recession.”
New York isn’t bucking the trend. According to a new report by the Fiscal Policy Institute on Labor Day, the Empire State lost 265,000 jobs between March 2001 and July 2003. On average, a staggering 574,000 people were unemployed statewide during the first half of this year.
When the Republican convention arrives in New York City next summer, draped in flags for a victory lap around Ground Zero, Mr. Bush’s Democratic opponent will be waiting with the unemployment stats in one hand and copies of Bill Clinton’s 1992 stump speech in the other. As President Clinton proved, the vast numbers of Americans who feel real economic pain can be mobilized with a simple promise of change.
Republicans call this “class warfare,” a cynical way to dodge responsibility for their economic stewardship. But the truth of the matter is that people don’t need a Democratic speechmaker to remind them that they’ve been laid off. Like the rest of, they have a way of noticing what’s around them, and believing what their eyes tell them.