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DECEMBER 30, 2003 – The economy
is recovering, and job growth is just around the corner.
Okay, that was the non-M/I media’s story
line for months now. But don’t expect it to last in the coming
year. The signs that they – like they do in so many instances –
come to see we were right in the first place and they were
collectively silly, to put it nicely, are beginning to appear
already.
“Wall Street’s glee about fourth-quarter
results is tempered somewhat by fears that earnings growth is
peaking.” – LA Times, Josh Friedman and Tom Petruno, Dec 22, 2003.
Ooops, Like we reported here (This
Quarter's Economic Disaster Touted As "Record Growth") the
profits we saw were just the debt-creating tax money creating a
momentary rise in the amount of water in the toilet bowl second
before both tank and bowl are left empty in a whoosh.
The rest of the press will still have in
depth stories about how and why the recovery is not taking off like
they thought. It is a way of them pretending they weren’t just
simply, daftly wrong to begin with but that new variables have come
into play.
They will also to try and reverse course
gracefully with hedge reports, like this one from MSNBC (Consumer
Confidence Dips In December) quoting an analyst on the
defensive: “I don’t see anything in this that tells me that the
recovery is in jeopardy, but I do think we will see a simmering down
in the fourth and first quarter.”
When the story starts shifting from “how
many jobs will this recovery create next quarter,” to, “is the
recovery now in jeopardy,” that is a huge shift. The mainstream
press covers its butt by gently indicating reversals a little at a
time, leading with gentle nudges in the opposite direction like this
one. So by the time they get to reporting what they should have
been saying all along – that there was no recovery, and couldn’t be
for the multitude of reasons we reported – it doesn’t seem like they
were so far off but just covering a different moment in time.
The facts have a way of ruining the best
story lines sometimes. Consumer confidence dipped far more
significantly than predicted for December (91.3 instead 92.2 or so
as predicted – and even the 92.2 would have been a decline.) The
reason for the dip: “Job worries,” MSNBC quotes a consumer as
saying.
Oh yeah, the press is starting to
realize, a recovery is only a recovery if people actually recover
something, like their jobs and incomes.
It was – and is – so obvious it was
nothing but a one time whoosh from debt-creating tax cuts that
caused the bounce that you had to wonder why anyone would have gone
along. The simple answer is that it was bullying pressure put on by
the Bush right. They whined and screamed that the press had been
reporting so much negative stuff, now they had to report that things
were positive. Didn’t they see the one or two good reports, the
Bush people screamed.
And so the press went along, but it
won’t last. Already the numbers are starting to look bad, and we
are still only competing against last year’s ridiculously low
pre-Iraq War numbers. As we reported, ¾ investors sees that the
looming deficits are going to create a big problem for the economy.
So if the numbers are already slowing
and these deficits haven’t even come into play yet, you can easily
predict what the coming year will bring: no-job growth, enter
inflation, and a return to recession, as paying interest on the
deficit drags the economy even further in the wrong direction.
The underlying assumption has been that
the economy is simply cyclical and that with time it recovers. It
does, if you don’t have horrible policies that destroy that
potential recovery. Just ask Japan, which has never really
recovered from its post 80’s bubble recession.
Unfortunately, the economy right now is
more a political issue than a true focus on fixing things. The
Democrats will be taking a sort of joy in quick death of the
fictional recovery, as it will help their election chances. The
Republicans will be using any positive signs to allow them to
pretend the looming economic disaster the Bush tax cuts and other
policies have created don’t actually exist, but are, instead, in
fact, good solid policies.
In the meantime, no one in the next year
will take the urgent steps our nation needs, and so we have the true
potential to plummet past another recession into a full-out
depression. And this is even without any negative catalyst, such as
another major terrorist attack.
As Democratic Presidential candidate
Sen. John Edwards (D-NC) said recently, “How can it be a recovery
when we have a record number of personal bankruptcies?”
Well, Senator Edwards, the answer is, by
reading the non-M/I press, that’s how. |
