The New York Times and Wall Street Journal lead with the latest numbers from the Commerce Department—which douse any hopes one might have harbored for a near-term recovery—and their implications for a stimulus plan that relies on much rosier projections. The Los Angeles Times leads with the local angle on the fiasco: California's unemployment rate topped 10 percent in January, well over the national average of 7.6 percent.
The Washington Post leads (and ends) with President Barack Obama's announcement that the U.S. withdrawal from Iraq has a date: August 2010, with one-third of current troop levels to remain in place through 2011. Although faster than what the generals had planned pre-election, it's a more cautious timeline than Obama had laid out on the campaign trail; the paper contrasts his strategy of "risk management" and "mitigation" with what it called "breathtakingly bold" action on the economic stimulus. Still, aside from some disappointment on the left, the plan—which got no cover treatment from the NYT—drew broad acceptance, with Republicans pointing toward the surge as what may allow for a successful withdrawal of troops. According to the Post, they will be missed.
On a day when the economy got a lot worse very quickly, the Commerce Department backtracked from previous estimates, revising its numbers for the end of 2008: The U.S. actually lost 6.2 percent annual-rate GDP in the fourth quarter rather than 3.8 percent. The first two months of the year were bad as well; the unemployment rate jumped 0.4 percent in January, and 600,000 people filed for unemployment insurance each week in February. Those figures, plus more bad results on trade and foreign economies, which the Journal says "truly fell apart," add up to the worst economic situation since 1982—which the administration couldn't even find a way to sugarcoat. "The first quarter is going to be bad," Council of Economic Advisers chair Christina Romer admitted yesterday.
The NYT highlights the widening gap between an increasingly dismal economic picture and the ambition of the administration's stimulus package, which assumed the economy would undergo a 3.2 percent growth spurt in 2010. Independent analysts' projections for next year's unemployment rate run as high as 12 percent—much higher than the Fed's estimate of 8.8 percent.
Parsing the latest tax proposals, the NYT figures that the super-rich would be hardest hit, with those earning middle incomes faring better than they may have feared. In fact, in another article, the paper calls Obama's budget a Great Society program for the middle class, mirroring the Post's terminology: the plan has a "boldness…that is breathtaking." The Post, though, takes a more skeptical view—what is this middle class exactly, and will a soak-the-rich strategy be able to finance benefits for a group of people so broadly defined? The LAT works both sides, pitting the "class warfare" and "overdue correction" interpretations of the budget against each other in a relentless they-think-this-and-others-think-that framework.
The WSJ details the third and ostensibly final bailout agreement for Citigroup, of which the public will now own 36 percent, in a relationship between the government and current corporate management—CEO Vikram Pandit is allowed to stay—that the paper characterizes as "awkward." The NYT presents an even more dour impression of the deal, saying that it still failed to remove the toxic assets at the heart of Citi's problems. The market agreed, sending the bank's share price down to $1.50.
The day's cognitive dissonance comes from an A1 Post piece on how administration officials have been rather chatty about race issues in recent weeks while the State Department threatens to withdraw from an international convention on racism unless items in a draft conference document condemning the Israeli occupation of Palestine and endorsing slavery reparations are removed.
The NYT fronts requiems for two beloved figures: Gotham's legendary district attorney Robert Morgenthau, scourge of white collar and sex criminals alike, who is calling it quits after 35 years on the job; and Denver's Rocky Mountain News, which had been for sale and folded yesterday after failing to attract a buyer. The Times also drew up the death certificate for advertising-dependent network TV stations, which are cutting back on their expensive marquee shows to put out reality and talk schlock that brings in viewers for less.
In the latest rollback of Bush-era regulation, Obama rescinded a rule that briefly allowed health care providers to withhold care they found objectionable. The move raised cries of outrage from a religious right already miffed over the progressive agenda outlined in the administration's $3.6 trillion budget—and losing a lion, in the form of Focus on the Family's James Dobson, who is resigning after 32 years in charge of the organization. Meanwhile, movement conservatives retreat to regroup, trying out phrases to carry them back to power: "European socialism"? The "Bush-Obama big spending program"? Whatever works!
The NYT reminds us that Obama is taking a risk proposing carbon regulation, which—in TP's phrase of the day—is nothing but a "coal state stickup," according to one energy executive.