Bush official: U.S. recovery is under way

Scott Sonner

Wednesday, Jan. 15, 2003 | 9:47 a.m.

RENO -- President Bush's plans to cut taxes and create jobs would spur an already recovering U.S. economy into prosperity, a U.S. Labor Department official told Nevada business leaders Tuesday.

But Sen. Harry Reid, D-Nev., said the claims of economic recovery are "absolutely without basis in fact" and that Bush's tax cuts would drive up the federal deficit after "squandering" a multitrillion-dollar surplus.

Mason M. Bishop, deputy assistant labor secretary for employment and training, told about 800 business, community and government leaders at a Northern Nevada economic conference that Bush's plan would spur investment and create 2.1 million new jobs over the next three years.

"All signs point to recovery," Bishop said in a keynote address to the "2003 Dimensions" conference sponsored by the Reno-Sparks Chamber of Commerce and Economic Development Authority of Western Nevada.

"We believe the president's growth and jobs plan will turn today's economic recovery into prosperity that reaches every corner in America," he said.

Worker productivity is up 5.6 percent the past four quarters -- the biggest growth since 1973, Mason said.

"And yet, too many Americans are out of jobs," he said.

"We should only train for jobs that are in demand and lead to career paths," he said.

Bush says his $674 billion economic plan would create jobs and bolster consumer confidence through $59 billion in tax savings this year alone.

Reid, the second-ranking Democrat in the Senate, said the Bush administration is overstating the economic recovery and exaggerating potential benefits of the proposed tax cuts.

Mason "must have had his fingers and toes crossed when he gave that speech," Reid said by telephone from Washington.

"It is a figment of his imagination," he said.

"The fact is this is the first administration in the time we have been keeping records since Harry Truman to have a net job loss -- about 2.5 million. There are now 2.6 workers for every job available in America," Reid said.

"Last month we lost 101,000 jobs. The month before it was 90,000."

Others speaking to the economic conference at the Reno Hilton questioned whether recovery was under way.

"Today, all the signals are mixed," said Rick L. Weddle, president and chief executive officer fro the Greater Phoenix Economic Council.

"We hear certain parts of the economic are getting better. We hear certain parts of the economic are getting worse. It's time to get in the market. It's time to get out of the market," he said.

Weddle drew chuckles from the audience when he said "we are not in a recession. We are suffering from a 'sustained period of below-trend growth.'

"The fact of the matter is we all suffer and feel real economic pain but can't figure out what is really going on. We can't agree on what the outlook is or which problems we should tackle first. Mixed signals make it really, really difficult to rally support for needed action,"

Reid and other Democrats contend Bush's economic proposal rewards the wealthiest and offer only modest short-term relief to the average taxpayer.

"In the long term, it drives up deficits after squandering a multimillion dollar surplus," he said.

Reid pointed to former Treasury Secretary Paul O'Neill, who in his first public comments since being forced out of the administration in December said he saw only minor value in the centerpiece of Bush's economic stimulus plan, the elimination of taxes on corporate dividends.

"I would not have done it," O'Neill said in an interview published Sunday in The Pittsburgh Post-Gazette.

Reid said, "That sort of says it all."