BUSH BOOM

If, as Bush has been boasting lately, we're doing so well in the area of money, how come the average American doesn't actually seem to be accruing any?

When the Commerce Department recently tallied up consumer finances for November, it found that Americans shelled out more money than they took in. It was the seventh such month of red ink during 2005....

Given how much red ink households racked up in the first 11 months of last year, [Kevin] Lansing [a Federal Reserve Bank economist] said the nation's personal savings rate could well be negative for all of 2005.

That, he added, would be "the first such occurrence since the Great Depression."

... "You're seeing a situation where the consumers are spending every penny they possibly can and borrowing on top of that,'' said Joel Naroff, a Pennsylvania economic consultant....

A member of the Federal Reserve Board -- not a mere economist -- says in the same article that we shouldn't worry: people are just tapping into all that lovely home equity from the housing boom. But if we've all got such a big windfall, shouldn't we be a bit ahead? Shouldn't we be able to pay the bills and put something away for a rainy day? And what happens when the boom goes bust, or even just flattens out? What do we do then? Cut rich people's taxes even more?