It is going to become increasingly difficult to arrive at whatever the truth is about the American economy over the next three months.

The Republicans, mindful of the vulnerability inherent in the Clinton campaign mantra of the 1992 Bush-Clinton presidential contest, "It's the economy, stupid," will seek to portray the state of affairs as being as positive as possible. Even clearly negative elements -- Friday's hideous job creation figures as example -- will be subject to a spin effort to present them as part of a positive overall economic trend.

		Dan Simpson, a retired U.S. ambassador, is a Post-Gazette associate editor (dsimpson@post-gazette.com).

The Democrats, equally aware of the central importance of the state of the economy in Americans' choice of presidents and other candidates, will seek advantage from the negatives and argue that they can do better. As they seek to turn the economy into an electoral winner, if they are smart they will steer carefully between the Scylla of saying that things are too bad -- Americans are at heart optimists -- and the Charbydis of getting too specific about how they would fix things, for two good reasons.

The first is that the electorate might actually expect them to deliver if they win, and that might prove to be difficult, given the size, venomousness and strength of resistance of the snakes they would have to wrestle with to achieve change. Second, whatever they did right still might not work: The U.S. economy is full of imponderables and very much linked with the fate of other countries, players and elements that the American government simply does not control.

In spite of the head-splitting complexity of the data that confront anyone trying to make sense of the current U.S. economy, let's look at a few areas.

1) Jobs, of more than passing interest to those who have them, and those who don't. America's economy isn't creating them fast enough to keep pace with the number of people needing them, a new 130,000 per month. It has lost 1.4 million since 2001. July's figure of new jobs was a miserable 32,000, a fraction of the projected 240,000. Even the 32,000 figure could be adjusted further downward later, as the Department of Labor did by 18 percent in May and June, announcing higher figures and then revising them downward.

2) The budget deficit, the amount more that the U.S. government is spending and has to borrow than it is bringing in. The deficit is currently estimated for this year to be a new record, blockbuster $422 billion, up 13 percent from last year, bringing the national debt to $7.3 trillion.

The claim, by both Democrats and Republicans, whose members of Congress are fully complicit in this profligate spending, is that its size really doesn't matter, because most of it is owed by the American government to Americans. This is actually more or less a lie. The United States now owes more to foreigners than they owe us and their purchases of U.S. stocks and bonds are falling.

3) Inflation, and means to keep it under control. Inflation in the United States has been under control for years, but in June the Federal Reserve decided it was rising at a sufficient clip to justify raising a key interest rate by 25 percent. The current inflation rate, at over 3 percent, justifies the Fed's decision to raise the federal funds interest rate again, as it did yesterday, from 1.25 to 1.5 percent. But raising it has as a side effect of dampening of the economy overall.

The problem with inflation is that rises in wages don't keep up with it, historically lagging behind. American wages have been dropping since 2001. What that means is that the prices of basic elements in the cost of living -- including food and energy -- rise, while wages and salaries don't. The average American thus gets squeezed, feels it, and doesn't like it at all.

4) Interest rates. They dropped last year. People refinanced their mortgages and squeezed the equity out of their residences. They also ran up new record amounts of consumer credit card debt. Now the interest rates are going back up. People with debt incurred at variable rates, with wage increases nonexistent or falling behind inflation, are thus squeezed painfully. Some fall into bankruptcy or see their houses foreclosed. More Americans filed for bankruptcy last year than filed for divorce.

5) Confidence in the integrity of American economic and financial players. It is hard to imagine that anyone ever thought they were angels. American history is dotted with businessmen and bankers who turned out to be crooks. The current crop is only a little smoother than railroad owner William Henry Vanderbilt, in the 1880s believed to be the world's richest man, who, asked about the public benefit of his business, replied, "The public be damned."

By this point, after several years of scandals that have tumbled apparent rocks of Gibraltar such as Enron, which swindled its stockholders, pensioners and California energy consumers; Halliburton, which hosed down the American taxpayer and even the Nigerians; and relatively little fish like Adelphi's Rigas family, Americans have about as much confidence in the good intentions of business as they would in an Arthur Andersen audit.

It will be best for the next three months simply to ride out the politicians' excuses, promises and other pronouncements on the economic situation, keeping faith in the country's ability to weather the current storm. The above analysis indicates clearly to me, however, that "no change of course after the elections" means that we as a country are headed for the rocks economically. If any of the candidates start to make sense on the subject of the economy, we'll need to be prepared to keep them to their promises if they win.