Everybody leads with the Federal Reserve's decision yesterday to lower short-term interest rates a half-point. Noting that the Fed didn't wait for its next regularly scheduled meeting several weeks from now and went beyond the quarter-point it usually employs when it bumps the money supply one way or the other, the papers are fully caught up in the excitement. USA Today and the Washington Post call the event "dramatic." The New York Times says it stunned investors and was a "powerful signal." The Los Angeles Times says it "had urgency written all over it." The resultant surge in the financial markets (Nasdaq up 14.2 percent, Dow up 2.8 percent) makes USAT think of "rocket fuel." The WP is more specific: "a Titan rocket."
The leads explain that the rate reduction was a turnaround for the Fed, which had only months ago been more worried about inflation than recession. The WP quotes former Fed Vice Chair Alan Blinder (very much in the papers today) as saying that yesterday meant the Fed was admitting "they had kept rates too high for too long." Blinder adds that Fed Chair Alan Greenspan missed the early warning signs of the 1991 recession. "It's the only thing he looks back on as a mistake, and I'm sure he's anxious not to repeat it."
The LAT lead goes high with another possible explanation of what might have been on Greenspan's mind. The paper notes that the unscheduled move "partially eclipsed" President-elect George W. Bush's meeting in Austin, Texas, with business leaders and says, attributing the idea to "some analysts," the message was "the Fed and not the White House remains the economy's manager-in-chief." The main Wall Street Journal story on the cut makes the same point. The NYT, WSJ, and LAT main Fed stories also note that in reacting to the interest cut, Bush reiterated his call for big tax cuts. A WP editorial, emphasizing the slowness with which tax cuts go into effect, says this brings "fresh doubts about Mr. Bush's judgment." Making the same argument, a NYT editorial says Bush's tax cut rationale seems "increasingly dubious." The WSJ editorial page goes the other way, saying that Fed policy is only one important lever in economic policy and that fiscal policy--taxing and spending--is another. There had also better be a tax cut soon, says the paper, and it better be big enough.
The Journal's main Fed story cites exactly one individual as an example of what it's going to take to keep the economy running--that would be one Audie Radzvickas, a 59-year-old "information-technology consultant." Last fall his investment portfolio was worth more than $80,000, but between "investment losses and withdrawals of principal" (the paper doesn't say how much of each), it's now $60,000. Things have gotten so bad that he and his wife "scrubbed a planned vacation in Hawaii." Note to the WSJ: Next time you want to color your stories with the likes of dear old Audie, find out what percentage of American households have at least $60,000 in savings, and, oh what the hell, put the answer in the paper.
Wednesday, Yasser Arafat told President Clinton in a phone call that he accepted with "reservations" the Clinton plan for resolving the Israeli-Palestinian dispute. But because of those reservations and because of mounting Israeli criticism of the plan, a settlement isn't viewed as imminent. Indeed, although both the WP and LAT front the story, both say that Arafat has merely agreed to more talks, with the latter calling Arafat's position "a qualified nod." The NYT, which runs the story inside, says that because of continued violence in the region, expectations for a full-fledged deal "sank further" and quotes unnamed American and Israeli officials as saying that a "historic accord" on the matter is "almost out of the question before the end of the Clinton administration."
USAT reefers and the NYT goes inside with a newly released study (of 6,800 students in 141 schools) purporting to show that when teen-agers take pledges to refrain from sex until marriage, they delay having intercourse for as much as 18 months longer than those who don't pledge. The pledges seem to be more effective with 15- and 16-year-olds and least effective with 18-year-olds. Some caveats: The pledge technique seems to work best when some but not all of a teen's peers are also pledging--apparently because publicly pledging confers status that diminishes if it's too common. And pledging students who fall off the abstinence wagon are more likely than nonpledgers to do so sans contraception.
USAT, the WP, and NYT front stories (with pictures) about Hillary Clinton's swearing-in yesterday as a senator, a first lady first. When, during the Lewinsky scandal, the NYT reported that President Clinton was said to have to sent a signal of solidarity to Monica Lewinsky during one of his public appearances by wearing a tie she'd given him, there was much skepticism. Yet, the WP reports that for yesterday's ceremony, President Clinton's electric teal tie matched Sen. Clinton's pantsuit.
The WP runs a little inside item reporting that today President-elect Bush is expected to name his top lobbyist. A few things the paper didn't explain to us beyond-the-Beltway rubes: Why does the president need a lobbyist? Has every president had one? Who lobbied for Bill Clinton?
The WSJ front runs a feature explaining that although you may not think much of the way Bill Gates dresses, in South Korea, "he is a serious style icon." Apparently there, where until recently a sea of dark suits was the business norm, now young executives hoping to get ahead like to mimic Gates' glasses, unpolished shoes, and wrinkle-free pants. The story describes how one Korean would-be CEO "likes to let several days pass without shampooing, to match what he calls Mr. Gates's 'natural oily look.' "
The NYT runs a Reuters dispatch reporting that to counter suspicions that Saddam Hussein suffered a stroke, the Iraqi News Agency observed that while reviewing a parade recently for five hours, Hussein "also fired more than 140 shots one-handed, something most young people are unable to do."