The critical issue of the presidential campaign is not jobs, or the deficit, or even the war in Iraq. The issue is credibility: which candidate can lead the country by telling the truth about where we are and where we need to go. And in that context, the efforts of John Kerry's team to portray the economy as being in terrible shape, and President Bush as being the Herbert Hoover of his era, are badly misguided.

First, it's simply not true.

The president inherited an economy that was already in a recession that, in the experience of most households, businesses and governments, lasted until the early months of 2003. This recession came after an unusually long expansion characterized, at its end, by a giant investment bubble that burst. It was only natural that such a downturn would require a longer-than-usual period of painful adjustment.

Instead of acknowledging those realities, the constant refrain from the Kerry camp has been that Bush has "presided over" the loss of 1.9 million jobs, creating the "weakest recovery" since the Great Depression. Most of this is simply economic nonsense.

In this country, presidents don't "preside over" economies, and they certainly don't control them. They can implement a limited range of economic policies that affect the economic cycle at the margin. And on that score, Bush deserves high marks. He pushed through a series of tax cuts that, whatever their lousy long-term impacts, provided a significant turbocharge to the Federal Reserve's high-octane monetary policy. Without them, the recession would surely have been deeper and longer.

Nor is it true that most Americans are stuck in an economic ditch. Depending on what data set and time period you want to pick, it is possible to show that the "average" worker or household is either better or worse off than last month, or last year, or during the last administration. But any objective look at the full range of data reveals that while inflation-adjusted pay for full-time workers was flat or slightly down during the recession, it has begun to pick up in the last year. Much of the gain comes in the form of health care benefits, which workers value highly. And because more people are working more hours, earning more from their investments and paying less in taxes, real disposable income has increased 4.6 percent in the last year.

Undeterred by these facts, Kerry's campaign has dredged up the old "middle-class squeeze," which emphasizes rising costs for energy, health care and college tuition. This analysis conveniently ignores falling prices for other basics like food, clothing, airfare or phone service, or lower monthly payments for homes and cars. It also suggests that the president is largely responsible for price increases largely outside his control.

For Kerry, the danger in playing this economic blame game is that voters will come to see him as no different than a president who has used exaggeration and selective use of facts to justify a war against Iraq. Rather than offering a contrast to the Republicans' highly partisan, attack-dog approach to political discourse, Kerry mimics it -- potentially turning off moderate, independent voters. And in terms of making a compelling economic case against Bush, it is wholly unnecessary.

This is, after all, a president who has made no progress in ensuring the long-term solvency of Medicare or Social Security. He has no credible plan to rein in health care costs or the budget deficit, both of which threaten long-term economic growth. His tax cuts contribute to the widening gap between rich and poor. In trade policy, Bush has allowed China to become the next Japan while sacrificing the interests of manufacturing and service workers to protect farm subsidies.

Most of all, the Bush economic program is based on the big lie that endless tax cuts are necessary to sustain economic growth. But the way to beat the big lie is with the "true facts," as my late colleague Peter Milius used to call them -- not another big lie about how bad the economy is.

Steven Pearlstein will host a Web discussion at 11 a.m. today at He can be reached at