It’s the economy again

It’s the economy again

Miami Herald: The U.S economy is taking hits from all directions, or that’s how it seems to many Americans. President Bush says that the country is not moving toward recession. Tell that to those reeling from the rising cost of gas, food, insurance, education and health care.

Home foreclosures are multiplying. People with houses can’t sell them. Home prices and sales dropped dramatically in January, and there’s no sign of improvement soon. Banks no longer provide easy credit. Stock-market investments are on a roller-coaster ride. Pay checks don’t buy as much today as yesterday.

In testimony to Congress last Wednesday, Federal Reserve Chairman Ben Bernanke described the malaise in economic terms. He said the U.S. economy will almost come to a standstill with sluggish growth in the coming months. Meanwhile, the housing crisis continues to rattle investors and financial markets, making it harder for people and businesses to obtain loans. Oil prices continue to push up the cost of food, and job growth is slowing. The result is inescapable: Consumers spend less for the simple reason that they have less to spend.

Near-zero growth

Reports last week show that the U.S. economy barely grew at the end of last year and consumer confidence is at the lowest level since the Iraq War began. This suggests that Americans will tighten their belts even more, which will hurt businesses and depress economic growth.

Meanwhile, Americans want to know what will turn the economy around. They want help and answers — from Congress and the president.

Downplaying economic pressures felt by Americans only encourages more pessimism, reinforcing the downward spiral. This will change when our leaders focus on turning around the economy and improving the lives of ordinary Americans.