As the curtain goes up on the 2004 Republican National Convention in New York, the economy will be one of the central issues. But far from certain is whether Americans feel better in their wallets and pocketbooks than they did four years ago, the last time they went to the polls to elect a president.
The last four years have been a financial roller-coaster for many families. Millions of jobs were lost to recession, productivity gains and off-shoring, yet the Federal Reserve says household net worth nationwide has swelled to $45 trillion -- all mixed messages making it that much harder to determine whether as a nation we're better off than we were four years ago.
On the campaign trail, President Bush says his economic policies are making Americans better off. “Because we acted, our economy since last summer has grown at a rate as fast as any in nearly 20 years,” Bush said recently during a campaign rally in New Mexico.
But in many living rooms and main streets around America, it's a different story. In total, 1.5 million new jobs were created in the past year -- only about half the number lost Bush 's watch. And some economists believe the statistics conceal an even darker picture.
“There are a lot of discouraged workers right now and a lot of Americans that are working part time that want to work full time, so the actual rate of unemployment is probably a lot higher than the stated 5.6 percent,” says William Wilson, an economist with LaSalle Consulting Associates.
Conference Board economist Ken Goldstein echoed that view: “The increase in incomes generated from those jobs has slowed over the last few years.”
The number of Americans living in poverty has grown every year Bush has been in office, reaching nearly 36 million last year. The percentage of the population without health insurance increased from 14.2 percent in 2000 to 15.6 percent in 2003.
But other indicators point in a positive direction. Inflation and interest rates are both hovering near 40-year lows, fuelling an historic housing boom. Total home ownership has soared to 69 percent, a record high. And the median home price is currently $191,300, up from $137,100 in January, 2001.
“Most areas of the country have experienced double-digit growth of appreciation over the last four years with some of the areas doubling or tripling in the last four years,” says Anthony Hsieh, homeloancenter.com founder and CEO.
As for investors, the Bush years have been a mixed bag. “What we've seen over Bush's term has been favorable to investors in that they were able to eliminate some of the dividend taxes, lower capital gains taxes, and also some of the tax breaks to the wealthy Americans,” says Marc Pado, Cantor Fitzgerald market strategist.
After two years of losses, stock markets emerged from the doldrums in 2003 with all indices up 25 percent or better. But that has still not been enough to bring them into the black for Bush -- the S&P 500 is down about 18 percent since Bush took office while an even bloodier Nasdaq has lost a third of its value.
And of course there’s the deficit. When Bush entered office there was a surplus -- now the government is an estimated $445 billion in the red.