I am sorry I don't remember who posted this graph first (probably
btower, but I am not sure - I will credit appropriately if reminded!
Update [2005-12-23 16:15:43 by Jerome a Paris]: It was
laughingriver in
this comment. ) but it is a good snapshot of the Bush years (both Bushes, by the way):
You have basically the same number of jobs in the economy as 5 years ago, despite a GDP growing by about 12% and population growing by 6% ( which means an increase of about 9-10 million people in the labor force). That the unemployment rate has gone down simply means that about
10 million people have given up looking for work.
The reason that poor showing of the labor force has not translated in lower growth is that, for the time being, there has been a debt binge. If you take out the newly created foreign debt (in the graph above, net debt = foreing debt), you see that there has not been any growth, in line with the jobs situation.
The debt has come both at the government level, with an unprecedented scissors movement between public income ("recettes") and spending ("dépenses") over the past few years.
But also at the consumer level, as Americans have cashed in on the increasing value of their houses:
and stopped saving altogether:
Note how the growth since 2003 coincides with the drop in the savings rate and the house equity withdrawal frenzy.
So in a nutshell:
- Bush is giving the money to the rich
- Americans cannot find jobs but can borrow easily
- the underlying economy stagnates
- the reported economy grows thanks to debt spending, both public and private
The only question is: when will it end?