USA Today leads with yesterday’s down stock market, which saw a 7.1 percent drop in the Nasdaq. The Wall Street Journal puts the market atop its front-page business index and quotes one money manager saying the Nasdaq has experienced a “crash.” The Washington Post and New York Times (online at least) go with George W. Bush’s announcement of four Cabinet picks: Alcoa CEO Paul O’Neill for treasury secretary; campaign chairman Donald Evans for Commerce; Orange County, Fla., Chairman Mel Martinez for Housing and Urban Development; and former Deputy Agriculture Secretary (under Bush’s father) Ann Veneman for Agriculture. The Los Angeles Times goes with what the paper calls a one-two “ominous turn” in Southern California’s energy crisis: Southern California Edison’s threat to begin rationing electricity over the Christmas weekend and Standard & Poor’s warning that it might downgrade the credit ratings of the state’s two largest utilities to junk bond status.
The USAT lead reports that the Nasdaq is in the midst of its longest losing streak of the year–down 23 percent in the past seven sessions. The story notes that the other major markets are sagging, too, but not nearly so badly, and it dials in the usual financial expert quotes offering up tautologies like, “There is still downside risk until investor confidence finds a firmer footing.” Both the USAT and the WSJ stories suggest the recent slide is of historic dimensions. Drops like the Nasdaq’s, says USAT, are “almost unheard of for major stock indexes.” For anything close on another exchange, “you have to go back to 1931, when the Dow Jones industrials plunged 53 percent and the Standard & Poor’s 500 fell 47 percent.” The Journal says that “the most spectacular bull market in stocks this century has given way to what will likely end up as one of the worst years for stocks in a generation.” But of course, this is only if one exclusively focuses on the percentage of the price drop for this year. But many shares were purchased by their current owners in previous years at prices lower than yesterday’s close. The Journal waits until much later in the story to suggest this broader, more correct, perspective. USAT’s lead never does.
The Bush Cabinet appointments have been in the papers for a few days. Perhaps the only surprise is that they didn’t include the naming of former Indiana Sen. Dan Coats as defense secretary. None of the papers write that this suggests there’s any kind of an internal wrangle over Defense, but they don’t explain the delay either. The WP says the Bush Cabinet is “shaping up as more moderate than had been expected by Bush’s opponents,” quoting a fairly pleased abortion rights advocate as the proof. According to the coverage, conservative worries about O’Neill’s former advocacy of a gas tax seem to have been overcome by O’Neill’s distancing himself from the stance. He’s quoted in the NYT as saying his days as a “free-ranging, self-admitted maverick” were over.
Both the WP and the NYT report that Bush friend Gov. Mark Racicot of Montana has cited family reasons in pulling out of the attorney general running, but that Bush was likely to name Wisconsin Gov. Tommy Thompson to head up Health and Human Services and New Jersey Gov. Christie Whitman as the Environmental Protection Agency administrator. The WP bothers to pass along that when announcing his choice of Martinez, Bush “stumbled” over his new title, saying he was going to become “secretary of housing and human development.”
Both papers also have statements from Clinton administration official Gene Sperling expressing “exasperation” (the WP’s word) with the president-elect’s recent talk of a possible recession. Sperling tells both papers, “It is a serious mistake for the new economic team to be talking down their own economy for short-term political positioning.”
The LAT reports that there is pressure building on California Gov. Gray Davis to take control of the electricity situation. Davis, the paper explains, has considerable statutory powers in this area–he could direct the state to buy electricity, and he could seize power plants. A more likely scenario, says the paper, is that he will help negotiate a considerable electricity rate increase for Southern California soon after the new year begins. The LAT points out near the bottom of the lead that since he took office two years ago, Davis has received campaign donations totaling at least $464,000 from energy companies and at least $113,500 from electrical worker unions. The story, like many on the region’s energy crunch, isn’t completely clear on why it occurred. For instance, it mentions that the Los Angeles Department of Water and Power, unlike Southern California Edison, has been “largely unscathed by the crisis,” but it doesn’t say why. Plus, the story says that deregulation of energy prices “turned sour this year when electricity prices, instead of going down, soared skyward, and electricity supplies in California could not accommodate the load.” Why didn’t an increase in prices decrease demand?
The WP reports inside that, according to the AP, George W. Bush lost the popular vote to Al Gore by 539,897 votes.
The WP reports that Tuesday night at a private party honoring some of Hillary Clinton’s staffers, when it was mentioned that the often-elderly recipients of the Presidential Medal of Freedom die shortly after receiving their honor, President Clinton responded, “I guess I should have given one to Katherine Harris.”