- The Washington Times - Thursday, November 29, 2001

Well, this is the week when coalition forces are close to defeating the Taliban's last stronghold, the ailing U.S. economy is feeling a tad more bullish and Americans are shopping again.
There was never any doubt, except among the most incurable pessimists, that the broadest global coalition ever assembled would triumph against the forces of evil in Afghanistan. The U.S.-backed anti-Taliban armies were about to rid the war-ravaged land of Osama bin Laden and his fanatic followers the first critical phase in what will be a long war against world terrorism.
The last major battle was being fought around Kandahar, where the Taliban forces were making their final stand. Elsewhere in the country, Afghans were celebrating their new freedom from their oppressive rulers. Movies were being shown again. Television was back on the air. Shops were opened. Negotiations over a new, broad-based government were under way. Five long years of the Taliban nightmare were coming to an end.
This will be the biggest U.S. victory since we freed Kuwait from its Iraqis conquerors in the Persian Gulf war and later ended Belgrade's ethnic cleansing war on Kosovo.
While military victory in Kandahar will be a major blow to the scourge of terrorism, the war against global-terrorist networks is just beginning, as President Bush reminded Americans earlier this week. There will undoubtedly be attempts to retaliate against us. Credible terrorist threats were received last week.
But I disagree with those who say that even if bin Laden and his chief lieutenants are eliminated, the al Qaeda network will be just as dangerous.
Remove their masterminds and they will be a lot less dangerous because leaders are not easily replaced. Freeze the assets of their financial backers, as we have, and that stifles their ability to mount major terrorist attacks. Round up their followers in Egypt, Saudi Arabia and other terrorist-breeding grounds, and you have dealt them a substantial, if not fatal, blow.
Hundreds of terrorists and their backers have been arrested throughout Europe and the Middle East. That figure will grow as pressure from the United States mounts on countries still harboring them. As Mr. Bush has said, "You are either with us or you are against us."
In the meantime, there is little doubt that our initial success in the war against terrorism is having a very positive effect nationwide.
Consumer-confidence levels are rising again, according to some surveys. Shoppers, drawn by a combination of sales, the Christmas season and perhaps a feeling of patriotic fervor, are filling the stores.
Retail sales are still below what they were a year ago. Buying power is the best encouragement that the economy may be staging a comeback a lot earlier than anyone expected.
The stock market has struggled to sustain its rally, as investors move to pick up good, long-term growth stocks at cheap prices and search for signs that the worst is over. The technology sector, buoyed by the government's settlement in the Microsoft antitrust case and improved earnings forecasts, is showing signs of cautious optimism.
The Dow's advance toward the 10,000 level and slowing weekly jobless claims are further signs that maybe we have reached the bottom in this market. But the 5.4 percent unemployment rate will likely rise over the next few months.
Certainly no one was surprised by the National Bureau of Economic Research's report that we were in a recession as of March. It was based on a broader definition than the two back-to-back, no-growth quarters that the government uses.
Gross domestic product, the measure of all that our economy produces, fell by 0.4 percent in the third quarter. It will likely be worse when the government releases its revised GDP figures on Friday.
But the fundamentals in this recession give us reason to hope that it will be much shorter than anyone expects. Productivity, the precursor of higher growth, continues to rise. Home building, housing and motor vehicle sales have been relatively strong this year. Inflation is tame. Interest rates are at the lowest levels in decades. Energy costs have fallen significantly. Income tax rates are coming down, with the next one point drop scheduled for January.
So the biggest guessing game right now is when will the economy turn around? Not until next year, perhaps not until the second or third quarter.
The final passage of a tax-cutting stimulus bill before Congress adjourns in December would speed up the recovery. So would a clear and decisive victory in Afghanistan, which would send the stock market soaring, giving a new and welcome meaning to the term "wealth effect."

Donald Lambro, chief political correspondent of The Washington Times, is a nationally syndicated columnist.


Copyright © 2018 The Washington Times, LLC. Click here for reprint permission.

The Washington Times Comment Policy

The Washington Times welcomes your comments on Spot.im, our third-party provider. Please read our Comment Policy before commenting.

 

Click to Read More and View Comments

Click to Hide