In economic attack on president, Kerry issues 'misery index'

Bush campaign dismisses study as political stunt

April 12, 2004|By Matea Gold | Matea Gold,LOS ANGELES TIMES

BOSTON - Seeking to further his argument that the middle class is suffering under the Bush administration, Sen. John F. Kerry plans to release an economic study today arguing that a so-called misery index has worsened drastically for middle-income families.

The study was conducted by the campaign's economic advisers, including former Clinton economic adviser Gene Sperling and former Clinton Treasury official Roger C. Altman.

The report examined median family incomes, college tuition, health insurance costs, gasoline prices, personal bankruptcies, homeownership rates and private sector job growth. It says six of the seven statistics worsened during Bush's term; only homeownership rates improved.

The Kerry report concluded that, under President Bush, the middle-class misery index has worsened by 13 points.

A decline in family income, increase in college tuition and an increase in health insurance premiums contributed the most to the crunch, the study says.

Much of the Democrats' criticism of Bush is focused on job losses during his tenure, but Kerry's study argues that far broader and more ominous economic trends are at work.

"Less noted, but perhaps even more important, is the fact that middle-class families are increasingly being squeezed by the rising cost of health care, college tuition and gasoline at the same time that wages and incomes are stagnating and personal bankruptcies are at record levels," the study said.

The Associated Press obtained a copy of the study yesterday. Kerry's presidential campaign planned a formal release today at coordinated events in more than a dozen electorally competitive states. The document discusses the economic status of all 50 states.

The Bush campaign has argued that its tax cuts have alleviated the burden on working families.

Between 2000 and 2003, the Kerry study says, inflation-adjusted figures show that wages dropped 0.2 percent while tuition at public colleges and universities increased by 13 percent. At the same time, health insurance premiums grew by 11 percent and gasoline prices were up by 15 percent, according to the study.

Kerry's campaign argues that those increased burdens far outstripped any financial gain from a series of Bush-sponsored tax cuts, which his administration contends put more money in the pockets of working families.

Bush campaign spokesman Steve Schmidt dismissed the index as a political stunt.

"John Kerry has made a calculation that if he talks down the economy, it will benefit him politically," he said.

Schmidt also said the economy is growing "at its fastest rate in 20 years" and pointed to the recent Labor Department report that 308,000 new jobs were created last month. Nearly 2 million jobs have been lost during Bush's tenure.

Kerry campaign officials said they prepared the study with economic data from the Census Bureau; the College Board; the federal agency that runs the Medicaid and Medicare health programs; and other government agencies, independent sources and advocacy groups.

With gasoline prices at near-record levels, each of the White House rivals seeks to blame the other. Bush's campaign has laid out a series of Kerry actions as senator from Massachusetts that could have led to increased gas prices. Kerry's study says drivers paid an additional $24 billion for gasoline this year, averaging out to $300 a family.

The term "misery index" became well-known during the Carter administration as an economic measurement used to express the combined effect of unemployment and inflation. Since then, it has taken on a broader meaning as a measurement of economic suffering.

The Los Angeles Times is a Tribune Publishing newspaper. The Associated Press contributed to this article.

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