[SIZE=3][b]GDP Jumps 7.2 Percent, Biggest Increase in Nearly 20 Years
Thursday, October 30, 2003
WASHINGTON — The economy grew at a scorching 7.2 percent annual rate in the third quarter in the [b]strongest pace in nearly two decades[/b]. Consumers spent with abandon and businesses ramped up investment, compelling new evidence of an economic resurgence.
The increase in gross domestic product, the broadest measure of the economy's performance, in the July-September quarter was more than double the 3.3 percent rate registered in the second quarter, the Commerce Department reported Thursday.
[b]The 7.2 percent pace marked the best showing since the first quarter of 1984[/b]. It exceeded analysts' forecasts for a 6 percent growth rate for third-quarter GDP, which measures the value of all goods and services produced within the United States.
The economy's recovery from the 2001 recession has resembled the side of a jagged cliff; a quarter of strength often has been followed by a quarter of weakness. But analysts are saying that pattern could be broken, considering increasing signs the economy finally has shaken its lethargy and is perking up.
Near rock-bottom short-term interest rates, along with [b]President Bush's third round of tax cuts[/b], have helped the economy shift into a higher gear during the summer, economists say. The next challenge is making sure the rebound is self-sustaining, they say.
Democrats, however, argue that the tax cuts contributed to a record budget deficit in the recently ended 2003 fiscal year and have done little to spur significant job growth.
Although the nation's payrolls [b]grew by 57,000 in September — the first increase in eight months [/b]— the economy needs to add a lot more jobs than that each month to drive down the 6.1 percent unemployment rate, analysts have said.
The administration has argued that as economic growth improves, meaningful job creation will follow. Bush will be counting on that as he heads into the 2004 presidential election season.
In other encouraging economic news from the Labor Department, new claims for unemployment benefits last week dropped by 5,000 to 386,000, [b]a sign that layoffs are slowing[/b]. [b]U.S. workers' wages and benefits went up by 1 percent in the third quarter[/b], up slightly from a 0.9 percent increase in the previous quarter.
Amid signs that the recovery is regaining traction, the Federal Reserve on Tuesday decided to hold a key short-term interest rate at a 45-year low of 1 percent. Super-low short-term rates may give consumers and businesses an incentive to spend and invest more, boosting economic growth.
Economists believe the economy will grow at a slower — but still healthy — 4 percent rate in the final quarter.
In the third quarter, consumers ratcheted up their spending at a brisk 6.6 percent annual rate. That was the biggest increase since the first quarter of 1988 and was up from a 3.8 percent pace in the second quarter.
Consumers in the third quarter spent lavishly on big-ticket items, such as cars, boosting such spending by a whopping 26.9 percent rate. And, they also spent briskly on "nondurables" such as food and clothes, which grew at a 7.9 percent pace, the strongest showing since the first quarter of 1976.
While consumers have been the main force keeping the economy going, there are more signs that businesses are starting to do their part.
Especially encouraging was the 15.4 percent growth rate in spending by businesses on equipment and software in the third quarter. That marked the largest increase since the first quarter of 2000 and was up from a 8.3 percent growth rate in the second quarter.
Sustained turnarounds in capital spending and in hiring are crucial to the economy's return to full throttle. Economists said business wants profits to improve and wants to be sure of the recovery's vigor before it goes on a spending and hiring spree.
The red-hot housing market, powered by low mortgage rates, also contributed to the strong showing on third quarter GDP. Investment on residential projects grew at a 20.4 percent rate, the biggest increase since the second quarter of 1996, and more than three times the 6.6 percent growth rate seen in the second quarter.
Federal government spending, which grew at a 1.4 percent rate, was only a minor contributor to GDP in the third quarter. Spending on national defense was flat. But in the second quarter, military spending on the Iraq war — which grew at a whopping 45.8 percent rate — helped to catapult economic growth.
A better trade picture in the third quarter also contributed to GDP growth.
But inventory reduction by businesses continued to be a drag on the economy and reduced third-quarter GDP by 0.67 percentage point. And a continuing reluctance by businesses to build up stocks suggest that executives remain wary of the rebound's staying power.
The third-year Presidential economic phenomenon is at it again!! I hope that this improves and all signs point to it improving. There is not doubt that tax cuts spur short-term growth, although I still contend that US Equities suck and will suck for a few more years as the correction continues and the dollar weakens.
But this is good news for those that are currently out of work and this is GREAT news for me since I hold a bunch of consumer discretionary stocks!!! C'mon holiday shoppers, spend spend spend!! :lol: :lol:
Tail - did you see your boy Kerry wa son CBS and said that he though Bush's tax cut was very adequate for the middle-class and that he agrees with it? He also voted for the Iraq War. Tell me why you like him so much, again??
[quote][i]Originally posted by jets5ever[/i]@Oct 30 2003, 02:34 PM
[b] Tail - Kerry agrees with Bush's middle-class tax cuts and voted to authorize the war. Again, why do you support him when you do not share his views about important things? Just wondering.... [/b][/quote]
Remarks by Senator John Kerry: Winning the Peace in Iraq
September 30, 2003
Washington, DC -
What does it gain America to win a war and lose a peace? Last Spring, our fighting men and women bravely swept across the battlefields of Iraq. But now as Summer turns to Fall, the Bush Administration’s lack of courageous leadership, its scorn for shared sacrifice, its stubborn dogmatism has put our troops at risk, creating a potential new sanctuary for terrorism and weakening America’s leadership in the world. Today, our soldiers lives, the future of Iraq, and the solidarity of free nations are being threatened not by a tin-horn dictator, but by a tin-eared Administration which insists that it is always right, refuses to admit when it is wrong, and over and over again misleads the American people.
Our country is paying a high price for the Bush failures. The clearest symbol of that price is the target on the back of young Americans serving in a distant desert. Today a soldier in Iraq fears getting shot while getting a drink of water. A squad at a checkpoint has to worry whether the old station wagon driving toward them is a mobile bomb. And the price is paid not only in their security and too often their lives, but in the erosion of American’s international standing, the prospect of new dangers down the road, and an endless drain on our national treasury.
The Bush Administration is asking us to pay more and more for its failures – another $87 billion that the American people are being asked to shoulder alone and which America’s middle class is being asked to shoulder disproportionately. Money that could be used here at home – to make health care more affordable, to pay for homeland security, to keep this President’s promise to leave no child behind.
This is an extraordinary moment for America. Just as in Vietnam, arrogance and pride stand in the way of common sense and integrity. “If we're an arrogant nation, they'll resent us. If we're a humble nation, but strong, they'll welcome us.” Those aren’t my words. They’re the words of George W. Bush – running for President, three years ago next week. How far have we come since then? The administration has engaged in sleights of hand that masqueraded as policy but were really just rhetorical checkpoints on a pre-determined course. They went to the UN, but used it as nothing more than a drive-by on the road to war. This may be the most arrogant, deceptive moment in our foreign policy in many decades. And America’s relations with foreign governments and American esteem around the world are at an all time low.
For Americans looking for leadership, for people across the globe looking for inspiration, the White House has become a house of mirrors where nothing is what it seems and almost everything is other than what the President promised. And the result is not just an Administration that has shredded its own credibility but that has left the very veracity of the United States in tatters. Who will believe the next Secretary of State who shows photographs at the U.N? Who will trust this President when he next vows to work with the nations of the world to combat common foes like al Qaeda, environmental catastrophe, or AIDS? New leadership in the White House is needed more than ever to restore American leadership in the world.
We were told Iraqis would see us as “liberators.” Too often they see us as occupiers, as a foreign power ruling over their country – preventing self-determination, not providing it.
We were told there would be a great international coalition of the willing. But this President’s pride has brought us a coalition of the few barely willing to do anything at all: 160 Mongolians, 43 Estonians, and 83 Filipinos isn’t a coalition; it’s a cover-up.
We were told the American people would not have to bear all the burden of rebuilding Iraq and that allies and the international community would join us in this endeavor. But an isolated America is now left almost alone to pay almost all the costs; in fact, we are paying other countries to do something, almost anything, in order to create the appearance of a coalition. This isn’t burden-sharing; it’s just the Bush version of Enron accounting.
Despite all the evasions and explanations, we are now in danger of losing the peace in Iraq because of the arrogance of this President and this Administration both before and after the war. It was bad enough to go-it-alone in the war. It is inexcusable and incomprehensible to go-it-alone in the peace. In the last year, President Bush has had three decisive opportunities to build an international coalition on the issue of Iraq. And three times, he not only failed; he hardly even tried.
The first opportunity came last fall after Congress authorized the use of force. That authorization sent a strong signal that the President and the Congress were united in holding Saddam Hussein accountable for his failures to keep his commitments and his scorn for the world community. It set the stage for the UN resolution that finally led him to let UN inspectors back into Iraq. When I voted to give the President the authority to use force, I said arms inspections are “absolutely critical in building international support for our case to the world. That’s how you make clear to the world we are contemplating war not for war’s sake, but because it may be the ultimate weapons inspections enforcement mechanism.” But the Bush Administration, impatient to go into battle, stopped the clock on the inspectors against the wishes of key members of the Security Council and despite the call of many in Congress who had voted to authorize force as a last resort. Despite his September promise to the United Nations to “work with the UN Security Council to meet our common challenge,” President Bush rushed ahead on the basis of what we now know to be dubious, inaccurate, and perhaps manipulated intelligence – intelligence which the inspectors could have vetted and corrected. So the first chance for a true international response was lost in a relentless march to war.
There was a second opportunity– after the Iraqi people pulled down Saddam Hussein’s statue in Baghdad. American and British forces had prevailed on the ground and it was time to win the peace. It was also obvious to everyone but the armchair ideologues in the Pentagon that the United States could not – and should not – undertake the reconstruction of Iraq on its own. To do so risked turning a military victory that promised liberation into an unwanted occupation by a foreign and Western power. From the moment that statue fell, the successful reconstruction of Iraq and the creation of a new Iraqi government depended on the legitimacy of the process in the eyes of the Iraqi people and the world. And that legitimacy in turn has always depended on internationalizing the effort. But the Bush Administration insisted on a UN role that was little more than window-dressing. And yet again, a critical opportunity was spurned.
President Bush’s third – and most recent moment of opportunity – came last week when he addressed the UN General Assembly. Other nations stood ready to stand with us – to provide troops to help stabilize the security situation and funds to help rebuild Iraq. All President Bush had to do was ask. Instead of asking, he lectured. Instead of focusing on reconstruction, his speech was a coldly received exercise in the rhetoric of redemption. Kofi Annan offered to help. The Bush Administration said, “thank you, but no thank you” – and I’m not even sure they included the “thank you.” The President was self-satisfied and tone deaf, stiff-arming the UN, raising the risk for American soldiers and the bill to the American treasury, and reducing the chances of success within a reasonable time and at a reasonable cost.
The President could have owned up to the difficulties we face. He could have signaled or stated a willingness to abandon unilateral control over reconstruction and governance. Instead, he made America less safe in a speech and in conduct that pushed other nations away rather than invited them in. That failure will cost us dearly in the months ahead, in an Iraq consumed with suspicion, resentment, and continued violence.
We may well catch Saddam Hussein in the days ahead. We may even succeed in winning a measure of stability. But what will happen to the larger goals, like insuring that Iraq does not descend into chaos and become a breeding ground for terrorism. And how many more lives will be lost because an Administration imprisoned by its pride will not admit its mistakes and change direction. We cannot let this happen.
The failure to plan for the post-war has already lost lives and dollars. And the failure is compounded every day by an Administration divided against itself. While President Bush may have declared the war in Iraq over, the war over Iraq inside his Administration rages on. Our troops are not just caught in the danger of snipers and bombs in Iraq but they are caught in the cross-fire of an Administration sniping at itself. The State Department and Defense Department are constantly in conflict over post-war plans. An Administration at war with itself cannot win the peace.
Just this week it was revealed that Secretary Rumsfeld prevented Secretary Powell from sending State Department experts to Iraq because, in Rumsfeld’s view, they might not be sufficiently anti-United Nations. Medical doctors were vetted to make sure they were anti-choice. Halliburton and other special interests with friends in high places are getting no-bid contracts. And big-time Republican lobbyists are setting up offices in Baghdad to line their pockets with the money the American people are spending to protect our troops and rebuild Iraq. The Iraqi people who cheered the fall of Saddam weren’t rejoicing because they thought they had replaced the Republican Guard with the Republican right.
This Administration’s brazen, go-it-alone policy has placed our soldiers at needless risk and our hopes for success in jeopardy. It has given al Qaeda an opening in Iraq – and made Iraq a recruiting poster for terrorists of the future. It has undermined America’s legitimacy with our own people, our allies abroad, and the Iraqis. And it has left them wondering when they will get their country back.
For months, there have been warnings about Iraq’s stockpiles of munitions. Three weeks ago, the Pentagon assured Americans those weapons were secure. Today we learn they are not – 650,000 tons of ammunition – unguarded and uncontrolled.
This Administration’s arrogance was so deep they even ignored the warnings of their own CIA experts in Iraq and carelessly disbanded the Iraqi army – resulting in 350,000 Angry Iraqis roaming the country – without a paycheck and with guns.
To ignore the CIA is one thing. To undermine our intelligence efforts and to risk the lives of our agents is beyond the pale and unacceptable. We learned in the last days the extent to which someone in a powerful position in his Administration, bent on revenge, endangered Ambassador Joe Wilson’s wife because her husband had committed the great crime of telling the truth. Outing a CIA agent endangers lives, threatens national security and breaks faith with those who put their lives on the line to protect this country. It is outrageous that the President who campaigned with a promise to restore integrity to the White House refuses to get to the bottom of this. President Bush’s father called those who expose the names of national security sources “traitors.” And this President Bush needs to start going after any traitors in his midst – and that means more than an inside once-over from his friend – and Karl Rove’s client – John Ashcroft.
So as we debate the President’s request for an additional $87 billion, we must demand a change in course. The stakes are too high– for our troops, for the Iraqi people, for the region, and for long-term American security – to continue down the path of arrogance into a quagmire.
We cannot walk away from Iraq but we must demand the internationalizing of military and civilian operations. This does not mean removing the United States from the process. It does mean inviting others into the rebuilding of Iraq and building of its new government; it does mean giving the United Nations a clearly defined role consistent with its capacity and experience. Even after the devastating attack on the UN compound in Baghdad, I believe UN personnel will return to Iraq, if the UN is given real responsibility and authority.
We should not abandon our mission but we must also demand that whatever we spend in Iraq be paid for with shared sacrifice, not deficit dollars. We are already shortchanging critical domestic programs –education, health care, and homeland security – to pay for George Bush’s tax cut for the wealthiest and most comfortable. Rebuilding Iraq does not have to add to that deficit of dollars and progress. That’s why this week Senator Joe Biden and I will offer an amendment to repeal tax cuts for individuals making more than $300,000 a year as a way to pay President Bush’s new $87 billion bill for Iraq.
How can George Bush tell reservists to spend another year in Iraq but not ask anything of Americans here at home? When others are sacrificing so much, why should we not ask those who have the most to do their part for their country?
And I ask my colleagues in the Senate: How can we justify running up the deficit, stripping away resources for schools and health care and Social Security, so this President can have both his $87 billion request – and his tax giveaways to those at the top?
And I ask the voters of this nation: Make your voices heard. Tell this Administration and this Congress to do what is right. The Bush tax cut for the wealthy was ill-advised when it was passed; now it is a denial of shared responsibility and sacrifice – and it should be repealed.
And all of us must ask what is this $87 billion for? Much of it – some $66 billion – is for our troops on the ground. The remaining $21 billion is supposed to be for reconstruction of basic services – such as water, sewer, and electricity – and for training Iraqi security forces. But it also includes $82 million to protect Iraq’s 36 miles of coast line, new prisons at a cost of $50,000 per bed, and a witness protection program at a cost of $1 million per family. All this for a country with the world’s second largest oil reserves. All this while injured American soldiers have been forced to pay for their own hospital meals and National Guardsmen and reservists are called up without health insurance for them or their families.
If the Bush Administration fails to internationalize the effort in Iraq, the American people could see a succession of endless costs down the road. And as we consider the President’s request, we must make every effort to ensure the necessary steps both to bring other nations and the United Nations into this operation in a meaningful way and to accelerate the transfer of sovereignty to the Iraqi people. The responsibility lies with the President. The Senate can only do so much. But we have a responsibility to do all that we can
We know the dangers that we now face in Iraq: the existing terrorist violence verging on guerilla warfare; the possibility of Iraq becoming a new version of the old Afghanistan, a protectorate for terrorism; the threat to stability in one of the world’s most vital and volatile regions – which grows worse not better as this Administration persists in its misguided policies. America has a stake in ensuring we meet these dangers.
The Administration’s plan will neither win the peace nor keep our troops safe. It seems more like Richard Nixon’s secret plan for peace that lead to more war than it does Harry Truman’s Marshall Plan for peace and stability. The issue isn’t what we’re spending, it’s what we’re buying. The American people demand and I intend to offer a better plan. It won’t be cheap, but it can and must be successful. The cost of failure would be too high. To fail in the transition in Iraq would put in danger other governments in the region. It would put at risk the war on terror. It would send a signal to all in the world that the United States of America is neither capable nor willing to take the risks to live up to what we all know we have to post-September 11. The Administration doesn’t have a plan for peace, they just have a price tag; but those who would cut and run don’t have a plan either – and the price of abandoning our efforts in Iraq would be every bit as unaffordable. What’s needed now is leadership – to finish the job in Iraq the right way.
With miscalculated arrogance and by misleading Americans, President Bush has put our troops in danger and put America in a dangerous position. But this Administration has staked America’s reputation and our role in the world on success in Iraq and the cost of failure is too great. We must succeed in the smartest, most effective way possible. To build success in Iraq, to win the peace, and to bring our troops home, the Administration needs to face the truth; abandon its arrogant, go-it-alone approach; and take these four essential steps.
First, we need a new Security Council resolution to give the United Nations authority in the rebuilding of Iraq and the development of its new Constitution and government – including the absorbing of the Coalition Provisional Authority. This shift of authority from the United States to the United Nations is indispensable to securing both troops and financial commitments from other countries.
The Bush Administration must stop stonewalling on the central question of control over reconstruction and governance. The United Nations knows how to do this. It’s done it before. In Namibia, Cambodia, Bosnia, Kosovo, East Timor. Its record may not be perfect, but it is far more experienced in reconstruction and political transitions than the Pentagon. This is not a mission for soldiers, but for civilians. And putting the civilian side under UN authority will enhance the credibility and legitimacy of the effort and encourage other nations to provide much needed funding and technical assistance. The US should not act as if Iraq is an American prize, but treat it as a nation that belongs to the community of nations. Nor is it the booty of war – with contracts and concessions to be handed out by the Administration to favored companies that are less interested in winning the peace than in winning a piece of the pie.
Second, we need a new UN Security Council resolution authorizing a multi-national force under US command – a command that properly should be ours because we are the largest troop presence. We will not put 130,000 American troops under foreign command. But internationalizing the force and placing it under a UN umbrella will spread the burden globally, reduce the risks to our soldiers, and remove the specter of American occupation.
Third, the resolution must include a reasonable plan and a specific timetable for self-government – for transferring political power and the responsibility for reconstruction to the people of Iraq. Their participation in rebuilding their country and shaping their new institutions is fundamental to the cause of a stable, peaceful, and independent Iraq that contributes to the world instead of threatening it.
Fourth, the Administration must accelerate efforts to train and equip Iraqi security forces –border, police, military, and civil defense– so that Iraq will have the capacity to provide for its own security over time. To do this we will need assistance from our allies and others to train and equip the forces as quickly as possible, to monitor their progress as they take to the field, and to serve as interim security personnel while the process is ongoing.
As the Senate prepares to act on the President’s $87 billion request, I intend to work with other Senators who share these views to make every effort to change President Bush’s unacceptable policies in Iraq and to pay the bill by repealing his unjustified tax cuts for the wealthiest Americans. We can and should protect our troops and we can and should meet our obligations in Iraq, but we should do it the right way. Failure is no excuse for its own perpetuation; irresponsibility should not build upon itself; America can and must do better.
This fraud b*tch was singing a different tune about Saddam and intelligence when Billy Boy attacked Saddam. In fact, Kerry referred to this same "manipulated" intel when he justified the attack and warned sternly that "one day Saddam will use this arsenal."
He says absolutely nothing of substance. The fact that he cites UN experience in reconstruction is laughably absurd. Dude, do you know ANY recent history?!?
He rips Bush for lecturing, and all he does is use buzzwords and cliches in his lectures. What a fraud.
Have fun when he drops out of the race after NH, buddy. He can't even out-poll or raise more $ than Dean in his home state!!
You must love partial-birth abortion too Tail - your boy is way into that. I guess when you call it "choice" its easier to accept than stating what it actually is - the murder of a born child.
[quote][i]Originally posted by jets5ever[/i]@Oct 31 2003, 03:46 PM
[b] I am not even saying this to be a jerk to you, but clearly you realize that the propspects of Kerry actually becoming the nominee are slim to none. [/b][/quote]
I really hope he does.
IMO...John Kerry would make a fantastic president.
[quote][i]Originally posted by bitonti[/i]@Oct 31 2003, 03:37 PM
[b] yeah ok GDP is up.
how does that help Joe Q Public?
no one but the privledged care about GDP
most people care about J-O-B
until this economic growth positively affects HOUSEHOLDS
its nice news but not as big a home-run that this thread makes it out to be.
the election will still be an extremely close one, this nation is basically split 50/50. [/b][/quote]
Just like the $1000 per child tax credit had no impact on Joe Q Public (according to you).
Are you the bastard child of Nancy Pelocy and Tom Daschle, because you sure sound like it? Admit it dude, you are a liberal democrat that hates George Bush because he is a conservative Republican. I admit I'm a conservative Republican, are you so ashamed to admit your stripe?
All this trash you guys heap on Bush and it's still only 50/50 (more like 60/40 worst case, but whatever floats your boat). That's why the left has to counter any good news that comes out.
The economy is improving marketly and with that comes more jobs and better pay - top that with lower taxes and even a "monkey" could win re-election.