March 6, 2005

Bush Boom

Larry Kudlow:

The economy is on a tear. You might not know this from coverage in the mainstream media, which may have a built-in bias against George W. Bush. Sure, some big outlets like the New York Times have come around at least somewhat on the president’s freedom-and-democracy revolution in the Middle East. But they’re not about to concede on the economic power of lower marginal tax-rate incentives.

Too bad, because the evidence is overwhelming that the supply-side tax cuts enacted in the spring of 2003 have triggered an economic boom. Yes, I will call it the Bush boom...

...Since May 2003 — which not coincidentally was the debut period for Bush’s tax cuts on personal income, dividends, and capital gains — the economy has generated 3 million new jobs. Using the Labor Department’s household survey, 2.6 million more people have been employed since the tax cuts. The unemployment rate has dropped to 5.4 percent from 6.3 percent. Weekly unemployment claims have fallen to 300,700 — the lowest since late 2000.

There are lots of other good data points. To wit: January factory orders for non-defense capital goods (excluding volatile aircraft) are 17 percent above year-ago levels, while shipments are running 14 percent ahead of last year. In other words, there is a capital-spending boom going on.

Posted by dan at March 6, 2005 12:23 AM