The Bush Boomlet: A good analysis of the Economic "Boom"

In Slate
The Bush Boomlet
By Daniel Gross
October 29, 2003

snip...

Some of the Bush boom is a matter of defining performance. We have yet to see two consecutive quarters of impressive growth. And even if John Snow's prediction of 2 million new jobs in the next 12 months materializes, that is still poor by historical standards. That breaks down to only 166,000 new jobs per month—which barely covers the 150,000 new job-market entrants each month and leaves a mere handful of positions for the millions of jobless who are currently seeking work. Between October 1993 and October 2000, the economy created an average of 2.88 million jobs per year. That's a boom.

The Bush boom promoters also sidestep the real issue about the third-quarter growth. It would be hard for the economy not to surge when you consider how much money the administration has poured into it in the form of tax cuts and government spending. It remains to be seen whether the economy can produce jobs and growth without continual booster shots, and whether the massive deficits the administration is running will drag down growth for years to come.

In Bush Boom, Bowyer argues that markets and investor activity can tell us more about the economy's health than the backward-looking government data upon which we usually rely. As evidence for the boom, he points to personal income, which has grown at a 5 percent clip since the third quarter of 2001, strong productivity, and reduced taxes on investment. (OK, OK, and OK.) Employment growth, he argues in the antidisestablishmentarian vein, is happening under the radar screen. (Maybe.)

The problem for the boomsters is that the data by which we traditionally measure economic growth examine the past, not the future—tomorrow's GDP figures will tell us what happened in the past quarter, not what will happen next quarter or next year. Job creation—just one among many important indicators but probably the most important political indicator—is a famously lagging indicator. Worse, these figures are always subject to revision. So, an economy that seems to be doing poorly can, when one looks back at it a few years later, be deemed to have been doing OK (see: 1991 and 1992). And when you're at the tail end of a boom, it can feel like it's going to go on forever (see: 2000).
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http://slate.msn.com/id/2090498/

If today's AP story says "Economy at Strongest Pace since 1984", does that mean the devastation Bush brings will last another 4 more years?