And Then It Turned Out They Were Wrong
Aug 28th, 2008 by Micah Tillman | 7 Comments |
Speaking of how terrible things are here in the US of DNC, the GDP grew at 3.3% (annually) last quarter.
Oh. Wait.
That’s a good thing.
That’s the opposite of a recession.
That’s so the opposite of a recession, it isn’t even funny.
(h/t Godlberg)
I’m not sure what it is, but I’m having such problems identifying with people who keep saying how terrible things are. Maybe because I live in the midwest and things to *hit* here as soon as the coasts. Maybe because Tim and I budget pretty well and have a bit of savings, even though we live fairly modestly (being missionaries and all). *Sigh.* I can’t even comprehend it all. I’m too tired to think about it. :) Must be “pregnancy brain.” lol
That is the cutest picture ever, Amanda.
The DNC peeps are using the tactics Plato says a rising-tyrant uses, and since you’re not into tyrants, it’s not surprising you don’t resonate much with it.
:-) That’s my theory.
Even during the growth period from 2003 to 2006 (give or take), I ran across many people who were still saying the economy sucked and the country was in dire straits. It’s mind boggling.
Been talking to Biden have you? :-) Here he is from last night:
I wonder what Obama will have to say tonight, now that the 3.3% number is out.
You can’t recede when you’re progressing. The economy can’t shrink when it’s growing.
It would be interesting to look back at former presidents to see if low popularity creates a negative general outlook, regardless of any evidence for or against that conclusion. It makes sense I suppose: if you don’t like someone, the last thing you want to do is compliment them. Not that I think a president should get much credit or blame for the economy, but others seem to.
Did anyone else read the footnote about how “real” GDP estimates are in 2000 dollars, which were worth at least 39% more than 2008 dollars? Or bear in mind that 15% of the GDP is imputed (a.k.a. “phantom”) income? How about that unemployment, if measured using the criteria used prior to the Reagan era, would sit not at the official 5.7% but at a staggering 12%? There’s plenty more bad news where that came from: Kevin Phillips wrote the book on it.
As for the tyrannical potential of a bunch of milquetoast chameleons like the Democratic Party… by that standard, the Republicans should have been able to amend the laws of physics to conform to some new Rove directive or signing statement. Why haven’t they used their panoptical reality-creating powers to their full potential? We haven’t even found the Higgs Boson, for crying out loud!
Did anyone else read the footnote about how “real” GDP estimates are in 2000 dollars, which were worth at least 39% more than 2008 dollars?
When we’re talking about percentages (like 3.3% growth) rather than absolute dollars, it’s entirely irrelevant what year we use as the basis for real GDP. We could use 1826 dollars and it would still show the same 3.3% growth.
Or bear in mind that 15% of the GDP is imputed (a.k.a. “phantom”) income?
One of the things that non-economists get confused about is that economists are not simply trying to measure the circulation of money, but how much people’s lives are actually being improved. Take for example a man with a wife who stays home, cleans the house, and looks after his kids. If we simply measured income, this woman’s work isn’t counted at all. But let us imagine his wife dies and he has to hire nannies and maids to do the work his wife had previously done. All of a sudden, there’s a big increase in economic activity, but is the economy really any better off? Of course not. “Imputed income” is an attempt to measure economic activity which is not being captured by the statistics. It is unquestionably a good thing to try to measure imputed income, though we can all grant that there are difficulties in putting an exact figure on such things. It is far more wise to complain about economic activity which is being measured, but which isn’t doing anybody any good. E.g. the building of bombs and missiles which make terrible consumer goods. (This is not to say we shouldn’t be building them, just that they do not actually positively affect the economy.) If you have genuine issues with how imputed income is being measured, then by all means let’s hear them, but complaining that it shouldn’t be measured at all doesn’t seem like much of an argument.
How about that unemployment, if measured using the criteria used prior to the Reagan era, would sit not at the official 5.7% but at a staggering 12%?
This is false. The only change to unemployment that I’m aware of made during the Reagan administration was including members of the military as part of the workforce instead of excluding them entirely. Since all of them are, of course, employed, this did have the effect of decreasing the unemployment rate, but it certainly didn’t decrease it by more than half. The 12% figure you have apparently comes from the article you linked to and includes “discouraged” workers (traditionally about .2% of the potential workforce, increasing it from 5.7% to about 6.0% and first excluded from the statistics by JFK) and also “marginally attached” workers (people not looking for a job but who will tell pollsters they want one) and workers who are part-time for “economic reasons,” i.e. employed people who want to work more. Neither of the latter two were ever included as unemployed in the figures. The first because they’ve never looked for a job and the last because, well, they’re employed. Even then you don’t get up to 12%. Those figures give 12% unemployment in 1994, but about 9% or perhaps 9.5% today.
I am reminded of Paul Krugman writing on Reagan where he said, “Despite the rapid growth of 1983 and 1984, over the whole of the Reagan administration the unemployment rate averaged a very uncomfortable 7.5 percent.”
The actual figures (which indeed average to 7.5%):
1981: 7.6%
1982: 9.7%
1983: 9.6%
1984: 7.5%
1985: 7.2%
1986: 7.0%
1987: 6.2%
1988: 5.5%
There’s plenty more bad news where that came from: Kevin Phillips wrote the book on it.
Phillips unquestionably uncovered some very real data manipulation (including the ones mentioned above), but in some cases he also misunderstood genuine attempts to improve the statistics as attempts at manipulation. It is, however, absolutely true that virtually no changes have been made which would make things look worse, so there is no question that the statistics now are rosier than they used to be. I can easily believe that the downturns in 1990/91 and 2001 were worse than the figures tell us, for example, and it’s probably the case that the latest downturn is worse than the GDP is letting on. Perhaps this helps us get at the truth, though, as none of these downturns were anywhere near as bad as the doomsayers wanted you to believe.