For a long time critics of the Bush Administration were constantly complaining about the economy. It wasn't that it wasn't growing (it was), or that it didn't produce enough jobs (it produced a lot), but that wage growth lagged behind all the other positive indicators. Such critics have been noticeably silent about this of late, as the economy is doing pretty much what it always does at about this point in the business cycle. As this blog hosts a gaggle of conservatives, it's our job to defend the Bush economic record, while it's my friend Chad's job to argue that all the good news doesn't mean *&%$ to the American worker. Right now our job is easier than his.
The Economic Policy Institute, a left wing think tank, has this to say:
The Bureau of Labor Statistics reported today that employers added 167,000 jobs in the last month of 2006, the strongest month for payroll growth since September, and well above analysts' expectations. Unemployment was unchanged at 4.5%.
With the exception of the usual laggards in recent months—manufacturing and construction—most industries expanded, with strong gains in business services, health care, and restaurants. Wage growth was particularly strong, up 0.5% over the month, and 4.2% over the past year, well ahead of recent inflation readings.
These stats are about as good as economic statistics ever get. The White House toots its own horn on this matter in a recent report. Here is the chart for job creation:
Clinton had one big advantage over Bush regarding the economic record: when the former took office the economy was going into recovery; when the latter took up residence at 1600 Penn. Ave., a recession was under way. Thanks to Bush's reelection, his record will rise far above that of President Clinton. Here's the next chart:
During the 90's business cycle, wage growth declined slightly. During this cycle it has so far seen a robust increase. Bush wins. Consider this one:
Both Presidents can crow that home ownership dramatically increased on their watch. The outcome favors Bush. But the best way to judge an economy's performance is to compare it with other economies, since all are struggling in the same global economic environment.
Only Japan has a lower unemployment rate than the U.S. But its GDP growth is about half that of Bush's America. Only Germany and the U.K. have GDP growth that almost equals that of the U.S., but Britain's unemployment rate is a full percent higher, and Germany's is almost twice that of the U.S.
Its tempting to attribute all this good news to Bush's economic wisdom, but the truth is that President's have only marginal control over the business cycle. I think that, given very different circumstances, both Clinton and Bush pursued sound economic policies. Moreover, the rules of the game allow both to take credit for pretty good records. But both benefited from the fact that, regarding the facts measured above, the U.S. economic model is simply better than any of its competitors.
At any rate, in the past I argued that Bush would leave office with better jobs and wages statistics than Clinton did. I hold to that prediction.
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