This morning, the Gross Domestic Product (GDP) was released and it came in better than was expected at six-tenths of one percent in positive growth for the last business quarter. Strictly speaking, this still reflects an overall (yet "minimally") expanding economy (See Full Story). While it may reflect an economy that is teetering close to recession, we are still not there. By historic definition, you need two consecutive quarters of "negative" GDP growth before you can actually say that we are in a recession.
This is important because two candidates, Hillary Clinton and Barack Obama, have said that we are "definitely" in a recession. For example, in his speech of March 27th of this year, Barack Obama said:
"Now, as most experts agree, our economy is in a recession. To renew our economy - and to ensure that we are not doomed to repeat a cycle of bubble and bust again and again – we need to address not only the immediate crisis in the housing market; we also need to create a 21st century regulatory framework, and pursue a bold opportunity agenda for the American people."
The problem with this statement is that many experts don't agree. If you had listened to the discussion (or arguments) on CNBC this morning that followed the release of the positive GDP numbers, you would have heard a lot of pros and cons at to whether or not our economy is actually in (or going into) a recession. This arguing, alone, is proof that we just don't know. But, never mind the "reality" of our current economic growth results. Obama and Clinton want you to believe that we are definitely in a recession. They also want you to believe that they, and only they, have the solutions that will help raise this country out of the current "economic disaster" that they been busily trying to convince you that we are in and have been in for months now.
This is politics as usual for the Democrats. They used this same technique when Bill Clinton ran against the then-current President, George H.W. Bush in 1992. All you have to do is think back to that famous Bill Clinton slogan of: "It's the Economy Stupid!" However, it wasn't the economy. We had only had a single-quarter dip that was effectively ended when the GDP numbers came out that October; a couple of weeks before the votes were cast in that year. We never entered a recession. But, it was too late and voters had already made up their minds. Bush lost. Following that, there was another full quarter of positive growth; reported in January. This gave us 6 consecutive months of growth before Clinton even got into office and became President. From that point on, our economy was literally roaring. Of course, Bill Clinton would have you believe that it was "all" due to his Presidency. However, when he took office, he did absolutely nothing that would have immediately stimulated the economy. In fact, his first priority was his "Gays in the Military" initiative. That liberal-voter-pay-back controversy actually consumed a couple of months of time before Clinton could get to work on any new economic proposals. This "flap" was ultimately resolved with the "Don't ask, don't tell" policy. A policy that still bothers the far left to this date.
In 2000, when Al Gore ran against George W. Bush, Bill Clinton's legacy to that election cycle "was" an actual recession; one that continued on and one that was exacerbated by the events of "9/11" in 2001. Like now, oil prices and gasoline prices were rising rapidly and hurting our economy. The then-current Energy Secretary, Bill Richardson, was flying all over the world and frantically meeting with the heads of OPEC to "jaw bone" prices down (Listen to a Charlie Rose interview with Bill Richardson). While Richardson falsely said that he had committments from Saudi Arabia to increase production and lower prices, it never really happened. So, left "without" the economy as an issue, the Democrats decided to used their old-standby of "fear mongering" during that election by saying that the Republicans would eliminate Social Security. Of course, we know now, that never happened.
In 2004, that economic"fear" technique was revived by the Democrats. This time they attempted to use the mantra that George Bush had lost more jobs as President than any other President since Herbert Hoover (See Full Story). This was important because it was Herbert Hoover that presided over the beginning of the "Great Depression." Unfortunately for the DEM's, the tax cuts (?for the rich?) that Bush implemented in 2003 actually turned the economy around and negated the "reality" of that "lost more jobs than Herbert Hoover" lie that was being promulgated by Dick Gephardt and many other Democrats.
The purpose of this blog entry is to highlight the fact that, over and over, the Democrats try to use "fear" about "jobs" and about "our economy" as a means to garner votes. This is the same kind of "fear" technique that the Democrats always blame the Republicans for using when "they" talk about terrorism and national security. But, the big problem with the Democrats using "economic fear" is that it "can" be a "self-fulfilling" prophecy. They can "scare consumers" into not spending and we can actually have a perception-driven recession. In fact, a recent poll said that 75% of the respondents believed we are now in recession (See Full Story). However, when asked, most people feel that their own personal economic situation was fine. To me, it "is" irresponsible for our elected and hope-to-be elected officials to "talk down our economy" for pure political gains. We don't need to "help" our economy into a recession by constantly telling the American people a political lie (See this video from "Fox News Sunday" that was recorded in March with comments by Democrats Dodd and Schumer). With the things that we have already done (like cutting interest rates, bailing out Bear Stearns, and issuing stimulus checks), the reality of an actual recession may already have been averted. Certainly, the indication of this is that the U.S. dollar seems to have stopped falling against the EURO Dollar (the European common currency) over the last week. In reality, we might only have one quarter of contraction as was the case in 2002. We just won't know, and we won't know until we actually see a downturn and the "two-quarter" recession-clock is started. And, with this morning's positive day, it will be another quarter before the clock even has a chance to get started. Sorry, Hillary! Sorry, Barack!