The AP is reporting a robust American economy:
Americans' incomes, bolstered by strong gains in hiring, rose by 0.3 percent in February while consumer spending climbed at an even faster pace of 0.5 percent, the government reported Thursday.
The Commerce Department said the gain in spending followed a much smaller 0.1 percent increase in January and reflected the fact that auto sales rebounded last month after having fallen in January.
The 0.3 percent rise in incomes was attributed to a surge of 262,000 new jobs in February, the biggest increase in four months. Further solid gains in both incomes and consumer spending are expected in the months ahead as the consumer continues to be a driving force in the economy.
Analysts said the February gains in incomes and spending showed that the economy was being propelled this year by continued strength in employment growth and consumer spending - which accounts for two-thirds of total economic activity.
As an ‘A’ student in economics during my college years, common sense tells me why we are experiencing such strong economic gains:
Starting with the recession in 2001, the country suffered through two years of outright declines in employment and then weak job growth in 2003. However, job gains accelerated last year, pushing employment up by more than 2 million workers, an increase that analysts expect to be matched this year.
The economic rebound was fueled by four rounds of tax cuts promoted by President Bush and easy credit from the Federal Reserve. With the impact of the tax cuts waning and the Fed now raising interest rates to make sure that the reviving economy does not fuel unwanted inflation, analysts believe that economic growth will moderate somewhat this year.
Of course, tax decreases are stimuli to the economy. Conversely, tax increases while reduce economic activity. So what are the Democrats, in conjunction with AARP, advocating as the fix to the Social Security problem…higher taxes. Yes, higher taxes meaning less jobs, meaning less payroll taxes, meaning more problems for the Social Security system. Higher taxes, meaning less economic freedom, meaning bigger government and more reasons for special interests groups like AARP to use misinformation as they pursue more and more of the Federal pie.
A Sibby Online reader reminded me about what Charles Krauthammer said last night on Fox News about AARP:
He said they exist solely to transfer wealth form working people to retired people. That is their ONLY goal.
Yes, and on Tuesday night I witnessed first hand how Tim Johnson and the AARP had joined forces, but then to say they were for more jobs. Those are lies. Higher taxes means less jobs. Johnson whined about jobs going overseas, but refused to mention that higher taxes is an incentive to drive business to such actions. AARP's idea of raising the Social Security tax ceiling from $90,000 to $140,000 will also have to be matched by the employer. Johnson didn't address that tax increase when whining about jobs going over seas. They also were not very kind to more jobs for stockbrokers and financial planners, as they made it sound like personal accounts were only going to be good for Wall Street.