DATE:
NOTE NUMBER:
DATE=11/01/99
TYPE=U-S OPINION ROUNDUP
TITLE=U-S ECONOMY/TERROR
NUMBER=6-12527
BYLINE=ANDREW GUTHRIE
DATELINE=WASHINGTON
INTERNET=YES
CONTENT=
INTRO: The United States economy, faltering before September's terror attacks, is sinking closer into recession. Wednesday the government announced new figures that the economy actually shrank slightly in the third quarter, prompting a good deal of comment in the nation's newspapers.
We get a sampling now from _________ in today's U-S Opinion Roundup.
TEXT: The United States economy was slowing in the late summer, prompting a growing debate during August and September as to whether a recession was beginning.
Then terrorists hijacked four jetliners and crashed two of them into New York's World Trade Center and a third into the Pentagon near Washington. The attacks further eroded the economy as people stopped flying for business and pleasure, and general consumer purchases slowed perceptibly. Many sectors of the economy were affected.
On Wednesday, the government announced that the economy had actually contracted four-tenths of one percent during the third quarter of the year. That prompted immediate comment in several major daily newspapers, beginning with the Chicago Tribune.
VOICE: The good news announced Wednesday was that the bad news wasn't perfectly dreadful. The government...reported ... (only) a modest decline given the extraordinary emotional and financial shock that hit the nation in September. The fourth quarter almost certainly will confirm that the U-S is struggling through its first recession in more than a decade. Struggling, but not buried. There is a message in that for Congress: Take a deep breath before foisting a lobbyist-inspired tax giveaway on the country in the name of a fiscal "stimulus" package.
...At a time when the federal budget is plunging back into the red after just four years in surplus, Congress doesn't have the luxury of throwing 100-billion dollars into a goody package that is laughingly billed as an economic stimulus.
TEXT: Another newspaper worried about Congressional excesses in the name of stimulating the economy is the Oklahoman in Oklahoma City.
VOICE: With the economy in a serious stall, Washington must exercise good judgment in crafting a stimulus package of tax cuts and business incentives that will encourage recovery, and resist a federal spending spree experts believe could actually make things worse. Data show economic on traction the past three months and rising unemployment.
The September 11th attacks jolted an economy that already was slowing down. ... President Bush weighed in yesterday, (October 31st) telling a group of business leaders that he is "greatly concerned" about economic figures showing a stagnant economy and demanded that Congress do something about it.
TEXT: The Washington Post is not pleased either at the approach Congress is taking in its economic stimulus for the whole country. It says of the latest proposal from Senate Republicans and President Bush:
VOICE: The new bill would confer an even larger share of its benefits on the richest people in the country -- not just the top half or top quarter, but the top one percent, the least in need and least likely to spend as opposed to saving the extra funds. That isn't stimulus. It's a large and cynical gift to a core constituency. In the short term it would do little economic good, and in the long term it could do considerable fiscal harm. If this bill is the serious choice, it would be better not to have a stimulus package.
TEXT: In Michigan, the Detroit Free Press says there is no way to separate the nation's anxious, or glum mood in the face of the on-going bio-terrorism, from the declining economic picture.
VOICE: President George W. Bush seized on Wednesday's economic dip as an opportunity to pressure Congress to pass his economic stimulus package right away. But around the same time, the fourth inhalation anthrax death occurred. Americans are worried about protecting themselves and their loved ones. Unless their fears are assuaged, a tax cut isn't likely to make them head out and spend.
No doubt the economy needs stimulating -- Wednesday's four-tenths-of-a-percent drop in the gross domestic product was the biggest since recession years, and a Wayne State (University, Detroit)-Free Press poll shows economic dissatisfaction is triple what it was a year ago. But that same poll shows that terrorism -- at 69 percent -- is far and away people's biggest concern.
To boost the economy, the government needs to help unclench the collective knot in the country's stomach by putting a priority on national security. Michigan got such support . . . Wednesday when the Department of Defense agreed to continue paying for Michigan National Guard troops at the border with Canada. Similar fast attention should be focused on shoring up the nation's hospitals to deal with bioterrorism, increasing the supply of antibiotics that can fight anthrax and other infections, and beefing up the security of airports and highways and railway tracks, as well as the country's water and energy supplies.
TEXT: The New York Times says that providing some stimulus to the U-S economy is "urgent" and it suggests that a "combination of quick action by Congress and steady rates from the Federal Reserve offer the best hope for turning the economy around." Surveying the post terrorist attack economic scene, the Times draws a somewhat pessimistic picture.
VOICE: During most of this year, consumers were the engine that propelled the economy while businesses drew down inventories and pared unneeded output. Yet even before September 11th that lone pillar had started to crumble. Personal bankruptcies reportedly jumped in August. Late payments and write-offs of credit card debt had been rising for seven months.
The trend will almost certainly continue, since the terrorist attacks alone may have drained as many as 500-thousand jobs from the economy. Companies not directly affected by September 11tj, including almost all the telecom giants, have also let thousands of workers go. Claims for unemployment benefits have reached levels not seen since 1991.
...Even without worrying about anthrax or hijackings, consumers would still be facing disheartening signs. Credit-rating firms expect a rash of bankruptcies among transport, travel and leisure companies over the next few months. Industrial production shows no sign of ending its long decline. Another potential problem is the housing market. Home sales fell more than expected last month, and further slackness would bring down prices.
...For maximum effect, Washington's fiscal stimulus package should target those most in need, who are most likely to spend any money they receive from the federal government.
TEXT: With that assessment from The New York Times, we conclude this sampling of U-S newspaper editorial comment on the latest government economic news about the shrinking U-S economy.
NEB/ANG/JWH
|
NEWSLETTER
|
| Join the GlobalSecurity.org mailing list |
|
|
|
