Recently, the Department of Labor released figures showing the creation of more than 300,000 jobs last month and revised its February estimate up by double. This is a very positive change after such anemic job growth, and it bodes well for President Bush's reelection campaign. But should we be applauding?
You could just see President Bush dancing in the Oval Office when these numbers were released. They offer him the perfect information to tout his economic policies, while they hurt Kerry's chances of running on the economy as the major issue.
However, the question needs to be asked: Did Bush's tax cuts really cause this strong job growth? The answer is no, but not because they were targeted at the rich or were just handouts to corporations. This country needs to rethink the idea that the president is in some way in charge of the economy.
It needs to be said: The effects of a given presidency on the economy are miniscule and fleeting. Repeat: The president is not that important for how well an economy does.
This is not some empty assertion. Most economists who have studied the issue would agree with this statement. The fact of the matter is the government as a whole just does not have a large enough arsenal to affect the economy.
Underrated in terms of importance is the Federal Reserve which controls the nation's money. It now appears that the Federal Reserve was crucial in bringing about the Great Depression by sharply reducing the money supply to curb speculation.
Furthermore, you can see the effect the Fed has had through the '90s by basically blowing a bubble in the stock market and now in the housing market. However, few people seem to recognize this fact.
Now here we have Kerry announcing his program to create 10 million jobs in his first term. This averages out to about as many jobs were created last month in a very robust expansion. But Kerry would have to average this over four years in office. I cannot wait to hear what he has in the bag.
Who is advising this guy? Tax cuts, tax hikes, regulatory change and any other policies a president can undertake are small peanuts in an increasingly global world. All of these effects are dwarfed by factors like technological shifts, oil prices, global competition and other just plain old random shocks.
The most we can ask for from a president is to promote stable economic policy through reasonable, steady interest rates, consistent regulatory policy and open market policy internationally. Anything more than this is uncalled for and reckless.
To think that we can \fine-tune"" the economy, the catchphrase in the Clinton administration, is hubris. President Bush can have no claim to creating these jobs with his tax cut.
Nic Lehmann-Ziebarth is a junior majoring in economics.
