White House won't say "fundamentals are strong"

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President Bush’s standard line to reassure economic markets has been to say that the “fundamentals of the economy are strong.”

 

That line was echoed by Republican presidential nominee John McCain this week, and he has come under fire from Democrat nominee Barack Obama, who called him out of touch with real Americans.

On Monday, Treasury Secretary Henry Paulson used different language when asked about the “fundamentals” of the economy, which tends to describe the long-term trends that extend beyond day to day fluctuations.

“When I look around the world and look at the long-term economic fundamentals we have in this country I think they compare favorably with what I see in any major developed country in the world. So we’ve got a strong basis in terms of where we are, in terms of working through this,” Mr. Paulson said during a White House press conference.

It was a far more nuanced statement than the president’s usual language, which has been used by public officials long before Mr. Bush came to office.

Today, White House press secretary Dana Perino was asked whether the economy fundamentals are still strong.

“Let me remind you what Secretary Paulson said, that as he looks at our country and compares it with other countries, that we are in a position of strength to be able to deal with this crisis, and it’s going to take us a while to work through it,” Mrs. Perino said. 

She added: “I recognize that this issue of strength has come into the 2008 election. I’m not going to try to get involved in it.”

Mrs. Perino was pressed again on whether “that assessment still stands, that the economic fundamentals are strong after this bailout and Fannie and Freddie and Bear Stearns and everything else?”

“Our economy has the strength to be able to deal with these shocks,” she said.

A few moments later, Mrs. Perino was pressed a second time, prompting the following exchange:

 

Q    You didn’t directly answer the question about whether the fundamentals of the economy are sound —

 

MS. PERINO:  I answered it the way I was going to answer it, and I’ll answer it the same way again.  So — and if you —

 

Q    Why are you — why won’t you direct —

 

MS. PERINO:  Because, Keith —

 

Q    I’ve never heard someone not answer that question directly, from the podium here, that the fundamentals of the economy are sound.  Are they, or not?

 

MS. PERINO:  What I said is that we have the strength to be able to deal with this crisis in our economy.  And I know that you’re not asking the question in the forum of a 2008 campaign, but I know as soon as I say something you’re going to turn it around and it will be a part of the 2008 campaign, and I’m not going to play the game.

 

Q    That’s not a game, though.  That’s a very important statement for the President of the United States —

 

MS. PERINO:  I answered the question.  I said our —

 

Q    — whether the fundamentals of our economy are sound.  You’re not answering that question.

 

MS. PERINO:  I did answer it the way that I was going to.

 

 

Near the end of the briefing, Mrs. Perino was asked yet again about whether the change in language reflected a “decrease in confidence from the White House about the economy?”

“I think it reflects a realization that we have today, the market dealing with a lot of information that’s coming its way,” she said.  We believe in the strength of our — and the resiliency of our system to be able to be flexible, to be able to handle that information, but it’s just going to take us a few days, maybe longer, to see how that shakes out.”

 

 

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