Edward P. Lazear, chairman of President Bush’s Council of Economic Advisers, said the White House had downgraded its earlier forecasts but still believed that the tax rebates of up to $1,200 for many families will help the economy escape a recession. President Bush said on Wednesday that the United States is not experiencing a recession. The stock market opened lower the following day and closed the week well down in the 11,000 range at 11,893.69. Many people regarded Bush’s comments as a pipe dream.

The worst fears of consumers, investors and Washington officials were confirmed on Friday, as deepening paralysis on Wall Street collided with stark new evidence of falling employment and a likely recession. In a report that was far worse than most analysts had expected, the Labor Department estimated that the nation lost 63,000 jobs in February. It was the second consecutive monthly decline, and the third straight drop for private-sector jobs.

“Even though predatory lending was becoming a national problem, the Bush administration looked the other way and did nothing to protect American homeowners. In fact, the government chose instead to align itself with the banks that were victimizing consumers” said Eliot Spitzer in a recent article. (opens in a new window)

One side or the other might be right but the truth might be somewhere in the middle. The problem lies with the fact that the Bush administration can ill afford the perception that this crisis, which spread around the world, is a self centered, self-serving American political mess manufactured to stimulate a lagging economy. Those of us in the business of fielding consumer complaints tend to side with Eliot Spitzer. We send consumers for help only to see them again. They return as frustrated, angry, disappointed consumers that lost faith in the government, the OCC, and others. Then by April 15th the government asks them to pay their taxes.