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Bush: economy's foundation strong
Forum in Waco designed to demonstrate the administration has a clear economic policy.
August 13, 2002: 2:12 PM EDT

NEW YORK (CNN/Money) - President Bush, speaking at the end of an economic forum designed to reassure Americans that he's paying attention to the economy, said Tuesday that he is confident the U.S. economy is on the mend

"There may be some tough times here in America, but this country's gone through tough times before, and we're going to do it again," Bush said at the end of the President's Economic Forum in Waco, Texas. "The foundations of the American economy are strong."

The conference, held at Baylor University, brought together Bush, members of his Cabinet, and more than 200 invitees who met to discuss topics ranging from corporate responsibility to health care.

As expected, Bush presented no new policy, though he said he and members of his administration would study the summaries of eight small discussion panels and consider some of the solutions raised there.

He also promised his administration would fight for free trade, punish corporate malfeasance and protect Americans' pensions, and he called on Congress to restrain fiscal spending, approve terrorism insurance and reform medical malpractice liability.

But he also called on businesses to better police themselves.

"It's time for corporate America to earn back our trust, and that starts with having CEOs lead the way," he said.

In the first session Bush attended, discussing small investors and retirement security, Bush asked participants to think of ways to make corporate financial reporting clearer.

"How do we simplify the numbers so people know what they're looking at?" he asked. "How can people all over America feel confident about what they see and hear?"

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Bush stressed that he thought it was the accounting industry's job to police itself and clarify reporting. The government's job, he said, would be to enforce laws and make people who break laws pay. He also said it was the responsibility of business schools to teach students right from wrong.

In the second session he attended, about economic recovery and job creation, Bush also called on Congress to pass $8 billion in anti-terrorism spending, saying it would create jobs; and he called -- as he often does -- for a permanent repeal of the tax on estates, the so-called "death" tax.

In another session, addressing health care, Bush called for medical malpractice liability reform and a cap on the punitive damages plaintiffs could win from defendants in such suits.

"Frivolous lawsuits drive up the cost of medicine," Bush said. "People ought to be able to recover damages if they've been mistreated, but there ought to be a cap on non-economic damages and punitive damages, and we ought to have joint and several liability reform."

Most analysts said Bush's meeting was mainly designed to reassure consumers and investors that he is paying attention to the economy. Many have noted that Bush has worked hard to avoid comparisons to his father, the first President Bush, who lost a bid for re-election because he was perceived as lacking interest in the economy.

Indeed, during his speech Tuesday wrapping up the economic summit, Bush appeared often to get excited about the economy, and he reserved special fire for corporate evildoers and for Congress, which he chastised for attaching pork-barrel spending projects to an emergency defense spending bill recently.

"If Congress won't show spending restraint, I intend to force spending restraint," he said.

On the other hand, Bush's critics have said that part of the reason the federal government's budget surplus disappeared last year was the large tax cut Bush urged to passage.

Even before the meeting began at about 10:00 a.m. ET, members of the Bush administration began spreading the message that all is well.

"[The economy is] slow, but we're still on the positive side, and I continue to believe we're going to end the year with a respectable growth rate in the 3 percent range," Treasury Secretary Paul O'Neill told CNNfn's CNNmoney Morning program.

O'Neill said he isn't worried about the economy "double-dipping" back into a recession that began in March 2001 and likely ended earlier this year, thanks to robust automobile sales, a strong housing market, low inflation and low interest rates.

Also Tuesday, Federal Reserve policy makers were meeting in Washington to discuss their target for short-term interest rates. Most observers expect the Fed not to cut rates, though it may alter the closely watched statement that accompanies its decision to say there are risks to the economy.

The Commerce Department reported Tuesday that retail sales rose in July. Some economists said that was a hopeful sign for the strength of consumer spending, which makes up about two-thirds of the total U.S. economy, while others said the strength was based too much on automobile sales, driven by aggressive dealer incentives.  Top of page

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