Pessimists Vindicated: Unemployment soars 0.1%

Hiring was up in February as employers added 243,000 jobs to nonfarm payrolls, according to the latest BLS survey. Average hourly earnings rose five cents to $16.47. Wages are up 3.5% (annualized), the biggest gain in nearly five years. Many economists project first quarter GDP growth well above 4%.

For those who prefer their news dreadful, unemployment shot up last month from 4.7% to 4.8%. Pessimists may make the most of it. I am sure those who wish to will see 0.1% as a festering bucket of puss that ruins the news of nearly a quarter of a million new jobs and a booming economy.

I recall the joke where a journalist falls in a lake. George Bush walks across the water to pull him out. The headline in the next day's paper, "George Bush Evidently Can't Swim".

Posted by Jack at March 10, 2006 11:50 AM
Comments
Comment #132650

jack,

And Shanghai was just a few bombs compared to the rest of WWII.

Interesting though that you use a religious themed joke for your Bush reference. They’re the only ones still around kissing his leprotic feet.

Posted by: Dave at March 10, 2006 12:11 PM
Comment #132651

Dave

If unemployment dropped by 0.1% and I bragged about that, would you think it was significant and that it was a justified celebration? You expect such small variations month-to-month. The big news is the growth and the job creation.

Let me give you an non religious joke.

Bush and Kerry run a footrace. Bush wins. The headline in NYT, “Kerry second in major race. Bush next to last.”

Posted by: Jack at March 10, 2006 12:21 PM
Comment #132656

Jack:;

Your headline is sure to get some reaction. Some will see that pessimism is vindicated, and not understanding the intended satire (or is it sarcasm—I can never get that right), will flock to comment on how they were right after all.

You’ll also get the comments, like you’ve already gotten, about how you are making too much of this. To which I would respond, “Pot, meet kettle…”

Keep up the good work.

Posted by: joebagodonuts at March 10, 2006 12:41 PM
Comment #132657

Jack,

Better joke, bad analogy.
Nothing changes the fact that those numbers are short term and that you and jbod continue to ignore the fact that the bridge is out down-around the bend.

Here’s another Bush joke:

http://www.thesmokinggun.com/archive/bushdui1.html

Posted by: Dave at March 10, 2006 12:47 PM
Comment #132659

Dave

I think Bush could beat Kerry in a foot race, although I understand that Bush has had some kind of injury. Kerry would certainly have better shoes and a more colorful costume.

The future is always uncertain. But based on the robust health we now have, I believe we will overcome.

The one real danger is entitlements. I am waiting to hear some good ideas about that.

Posted by: Jack at March 10, 2006 12:56 PM
Comment #132661

A few observations about NYT:

1) They covered Whitewater. A LOT.

2) It only has the third highest circulation among daily newspapers. The WSJ, which used its editorial page to advertise a video alleging that Clinton was a serial murderer, has almost twice as many readers.

3) Judith Miller was told by the military that WMD were found in Iraq and reported it as if she had seen them firsthand.

4) I had heard claims that the liberal media was downplaying positive economic news in 2004, so I started paying attention. There was a positive growth report right before the election, and they not only made it front page news but had a big graphic of an upward pointing arrow.

Posted by: Woody Mena at March 10, 2006 1:01 PM
Comment #132669
(a)But based on the robust health we now have, I believe we will overcome.
(b) think Bush could beat Kerry in a foot race,
Posted by: Jack at March 10, 2006 12:56 PM
(a)It’s too bad your supposition is so grossly wrong. (I wish I were wrong, but I’m pretty sure I’m not)

(b) Bush in in shape because rather than run the country he goes for a 3 hour bike ride. I’m not sure if I’m glad he spends less time ruining things or if he would do better if he spent more time learning and then running things.

Posted by: Dave at March 10, 2006 1:33 PM
Comment #132672

Jack:

Its evident that Dave enjoys his pessimism. Either that or he has simply learned to accept it. Its similar to how some people are about the weather: When the weather is bad, they complain about how bad it is. When the weather is good, they complain about how its gonna get bad soon.

The economy is never going to be perfect. There will always be unemployed people. If the pessimistic people of today were around years ago when buggy whips were made obsolete by the invention of the car, they’d have bemoaned the loss of jobs for the poor buggy whip manufacturers, while missing out on the obvious benefits of the automobile.

Posted by: joebagodonuts at March 10, 2006 1:57 PM
Comment #132673

[in a robotic impression]

Yes…president…doing…good…i…have…no…complaints…peachy….everything…peachy….*fuse blows

Posted by: tree hugger at March 10, 2006 1:58 PM
Comment #132675

tree,

Isn’t it amazing how those people keep sounding like Bush pumping up on “stay the course” steroids while using old and tired condescending analogies? (like mine?) As if being a realist planning for the future more than two years out makes me a masochistic pessimist, instead of a kool-aid drinking sheep-like automaton.

The only thing I can think of is it’s because they’re too old to worry about their futures. It’s just too bad they don’t worry about their offspring’s.

Good impression, BTW. Heh…..Heh…Heh..heh

Posted by: Dave at March 10, 2006 2:21 PM
Comment #132677

All things considered, I don’t agree that Bush has taken much criticism for the unemployment rate. It’s not even in the top five.

He has government deficit spending to thank for it.

The next months or next quarters numbers are all that matter to Jack anyway.

Posted by: Schwamp at March 10, 2006 2:30 PM
Comment #132679

The end of the world is probably more than two years out.
Do you dread this fact every single day too?
Who do you blame it on when the Dems are in power?

Jack
I’m sure you know the pessimism is fueled only by the desire for political gain.
If the voters wont vote for you because of your agenda, scare them into voting for you.

Posted by: kctim at March 10, 2006 2:42 PM
Comment #132682
Wages are up 3.5% (annualized)

Before or after inflation?

And by “inflation,” I mean ALL inflation, not the oft-quoted measure which exludes the price of gasoline at the pump!

Posted by: Steve K at March 10, 2006 3:18 PM
Comment #132683

Kctim,
“If the voters won’t vote for you because of your agenda, scare them into voting for you.”

Very true. Even today, we are on Yellow Alert. There is a “significant risk of terrorist attacks.” Now, a Blue alert means there is “a general risk of terrorist attacks.” Just doesn’t get it done, does it, Blue alert, does it? Blue hardly sets the body politic all aquiver with fear, it’s too… well… general.

Of course, pretending we’re at a high level of alert helps justify shredding the 4th amendment.

Did everyone enjoy Sandra Day O’Connor’s warning about how the US is heading towards a dictatorship?

Posted by: phx8 at March 10, 2006 3:21 PM
Comment #132685

The following is a cut & paste from the left column, and seems appropriate to add here:

243k non-farm payroll is unquestionably a good number, practically Clintonesque. The wage number and CPI/PPI numbers suggest inflation is running along at a 3 - 4 percent clip. What it means it the Fed will feel comfortable raising the Federal Funds rate again later this month, and probably at least one more time after that. Climbing rates and an inverted yield curve are harbingers of the inevitable economic downturn that follows a recovery. It’s normal.

What’s hard is the weakness of this recovery, to be followed so soon by a recession. Only twice in the past year have we seen non-farm payroll numbers like today. Since the beginning of the Bush administration we’ve seen a little over 2 million jobs created, which is disastrous.

(Btw, Bush apologists will counter with numbers of jobs created since the low point of the recession. That’s pretty funny. So, if a person goes gambling with a hundred dollars, loses fifty, and then makes 40 back, does that mean the person won $40?).

So we’re near the top of the roller coaster. Individual investors are re-entering the stock market, which is a warning sign. The little guy is always wrong. When you see Bush supporters loving the economic roller coaster ‘cause this car is going up and up and up, and they’re throwing their arms over their heads and squealing ‘wheeee,’ Katie bar the door.

We’re just about there… a nice little drop in oil prices could set off the excessive optimism, something soon, before the next hurricane season begins.

Posted by: phx8 at March 10, 2006 3:25 PM
Comment #132688

phx8
You will get no argument from me concerning the the terrorist alert color codes and how they have been used.
But then again, I’m one of those nuts who actually believes OBL will be dealt with not too much before the elections in 08 or 10.

Posted by: kctim at March 10, 2006 3:29 PM
Comment #132689

I do fix on this quarter’s numbers and compare them to the trends of previous quarters. Nobody can predict the future. All we have is the current trend. It sounds wise to make statement about not living in the short term, but in the long term we are all dead. There is no such thing as a future decision. Only decisions made now that affect the future. And there is no such thing as future data. Only data we have now that may help us anticipate the future. So we have to make decisions in the present based on data we have in the present.

If you guys have a really reliable way to predict the future, I suggest you invest accordingly.

If I could be certain of the direction of major markets for the next year, I would be a multimillionaire by December. It could be done with an initial investment of only a couple thousand dollars and even in a falling economy. If you know the future. So sell you cars and mortgage you house. Do it if you can. Otherwise you have to stick the usual data.

Posted by: Jack at March 10, 2006 3:39 PM
Comment #132692

PHX 8,

Since this terrorist war is just a big scare tactic, I assume you were a big proponent of the UAE Port deal and wondered what all the uproar was about?? And I’ll be sure to tell OBL and Zarqawi that they can take off their terrorist costumes … the ruse is outed!!

Woody,

Thanks for bringing up the 4 or 5 times the NYT leaned right. But you had to go back a ways I noticed … good and, most of all, tough research nonetheless. If I ever have a needle in a haystack … I’m calling you!

Dave,

You’ve convinced me, the country is in or near ruins. People much preferred unemployment rates above 5.5%. People much preferred their simple rental apartment instead of investing in a home … to much logistics with home ownership. Who do we think we are? The government who knows how to invest our money so much more wisely with the current SS program?? I think not! We should be happy with the nation’s lowest savings rate and shut about it already. People also much preferred multiple UN resolutions with the same ole meaningless threats. I mean, what does “Disarm, Disclose, or face serious consequences” mean anyway? It’s very vague I think. Don’t you? I mean, I know we already had imposed any and every sanction possible on Iraq … but surely serious consequences didn’t mean combat. You know, what about those paddles with the little holes in them school principals had way back when … couldn’t we have used those first??

Posted by: Ken C. at March 10, 2006 3:58 PM
Comment #132698

Ken,

Are you a K-Mart or Wal-Mart kind of guy?

Posted by: Dave at March 10, 2006 4:32 PM
Comment #132699

Ken,
I’m not a proponent of the port deal. I’m fine with doing business with the UAE. I don’t think UAE ownership represents a threat. The issue does exemplify the atmosphere of fear & creeping xenophobia. Democrats wasted no time bludgeoning the Bush administraton with the issue. Dems prospered in the polls by appealing to the same fears cultivated so long by the Bush administration. And for what it’s worth, my problem with the deal is with the idea of selling off US assets in the first place.

On a side note- I’ve seen interesting speculation that Zarqawi died. His wife lives in poverty, and his mother died lst year without any contact or comment by him.

I’m also suspicious of OBL’s last released tape. By all accounts it was very, very different from previous releases.

Jack,
I can be such a nervous nellie. You see, when Bush supporters tell me to be optimistic about the economy, I get very very worried. Perhaps you could elucidate: when it comes to the economy, just what kind of optimism are we talking about here?

1) “Mission Accomplished!”
2) We’re making a Cheneyesque “steady progress”
3) Things are “going very, very well” ala General Peter Pace
4) You’re doing a heckuva job, Snowie!
5) Recession? Bring it on!
6) The deficit and debts are in their “last throes.”
7) No one could have anticipated another recession would ever happen.

Posted by: phx8 at March 10, 2006 4:33 PM
Comment #132701
Btw, Bush apologists will counter with numbers of jobs created since the low point of the recession. That’s pretty funny. So, if a person goes gambling with a hundred dollars, loses fifty, and then makes 40 back, does that mean the person won $40?

Interesting you make this analogy. That’s EXACTLY how the gamblers I talk to describe their gambling.

They NEVER talk about what they start with.

They NEVER talk about losses.

They ALWAYS tell me about their big winnings.

The Bush administration is just like the compulsive gambler you describe.

Posted by: Steve K at March 10, 2006 4:37 PM
Comment #132707

Steve:

Its not that way, in my experience. I talked with several friends who are opposed to Bush—they talked about how bad the economy is and how poor the job market is. I pointed out that Bush inherited a sinking economy and that in his first two years, there were many jobs lost….but….that over the past couple years the jobs creation had done well.

Now, that’s pretty factual commentary pointing out where we are TODAY—-not yesterday, not tomorrow. Yet they couldn’t be bothered with my facts—they prattled on how Bush has lost more jobs than Hoover etc.

I didn’t make claims that the economy was great, that there were no debt issues, that jobs creation over the past 6 years was stellar etc. I simply pointed out that Bush’s tenure started out with big problems (911, accounting scandals, bankruptcies) which couldn’t have been his sole doing, seeing as they each had roots prior to his Presidency.

The facts simply didn’t matter.

Posted by: joebagodonuts at March 10, 2006 5:25 PM
Comment #132708

Of the top of my head, here is my response:

This is about rationalized failure.

First, the Bush administration has lied and spun so much regarding so many aspects of the recent economic failure, that people are hard-pressed not to attribute their sunny forecasts and figures to creative accounting.

Second, the Bush administration has started a war and created a huge deficit, both of which raise questions as to whether the new figures represent the light at the end of the tunnel or the nine o’clock train.

Third, for many people the recovery seems marked more by investor and rich folk’s gains than it does local improvements in the economy. One problem may be that the exuberant overspending of boom period and after 9/11 has carried with it a debt burden that is making it difficult for people to enjoy or pass along greater prosperity. But more to the point, when people don’t see the benefits of these numerical improvements, they may begin to see such gains as abstractions, of academic interests, more than practical use.

Fourth, the failure of the markets to moderate the behavior or losses of Enron and the other companies before the fact raises questions for people as to whether this recovery is a true one, or just another bubble swelling in the wake of its predecessor. Not enough real reform has been presented to Americans to reassure them that the economic improvements reflect real gains in wealth that will bring real returns for those who take the chance.

We need confidence to truly line ourselves up with numbers like this, and viscerally feel the success of it. If we are not able to trust the word of corporate or federal authorities, if we see inequitably distributed gains that do little to work towards our interests, and if we must look at the future of the market with dark clouds of debt and conflict looming over them, it’s going to be pretty hard for us to take the numbers seriously, and perhaps with good reason.

Posted by: Stephen Daugherty at March 10, 2006 5:27 PM
Comment #132710

Stephen et al

We are not rationalizing failure because we are dealing with SUCCESS.

Unemployment in the fifth Clinton year was 4.9%. Unemployment now (in the fifth Bush year) is 4.8%, according to BLS. Both those numbers are excellent.

Unemployment can go a little lower, but not much and not for long, no matter what the economic growth. Since 1997, the U.S. GDP has grown by about 1/3, but unemployment, being a percentage cannot improve like that.

Any unemployment rate below 5% is great, BTW. And economic growth of 4% is good.

My prediction is that in the future it will be better (at times) and worse (at times) just like it was in the past. But the outlook for the immediate future looks good.

You can contend that it is gonna get worse, but it is very hard to believe that it is bad now. And predictions of doom are not based on empirical data.

Posted by: Jack at March 10, 2006 5:42 PM
Comment #132716

Dave,

I just clicked you’re link. The wedding video shows how down to earth and how funny George Bush is. I don’t understand how anyone couldn’t love the guy.

Posted by: andy at March 10, 2006 6:04 PM
Comment #132717

Man, BDS can be SUCH a drag, both for the sufferors and the normal people who have to endure the sufferors…..

Posted by: nikkolai at March 10, 2006 6:06 PM
Comment #132720

“You can contend that it is gonna get worse, but it is very hard to believe that it is bad now. And predictions of doom are not based on empirical data.”

Jack, you are right. If we look at the numbers NOW, it does appear that we have a healthy, growing economy. I understand you use the unemployment numbers as a barometer of this, but i don’t see you in an uproar about the potential ramifications of the budget deficits, the record public debt (i am in my 20’s…you seem to forget that MY GENERATION WILL BE PAYING FOR THIS!!!), the utterly massive trade deficit, negative savings rates, the slowdown in housing, and now the rising interest rates on the long end of the curve.

Not to put words in anyone’s mouth, but i believe the point Dave and phx8 are trying to make is that while the American way of consumption, debt, spending, and the loss of physical and intellectual capital to other parts of the world is a recipe for disaster…not now, but 2, 3, 10 years down the road.

Oh yea BTW…the government hit its debt ceiling, and if it isn’t increased by the end of this month, we default on our debt. Does that phase anyone but us pessimists?

Posted by: Greg the Underwriter at March 10, 2006 6:18 PM
Comment #132724

Greg

The dept per say is a challenge, but not a killer. We had higher debt ratios in the early 1990s. Our GNP is 1/3 bigger than it was then, so you have to look at debt versus ability to pay, just like your mortage lender does.

The real problem is entitlement - SS, medicare, mediaid etc. YOu will get screwed with these things if nothing is done. Demography is against you. This is a big problem, but when Bush tried to address it he got fried. You are right, we will pay more tomorrow, but I don’t think we will address it until it is a crisis in about ten years. I have three kids. My daughter is 20. I don’t want them paying for the old farts either, but unless something is done soon, that is the future.

So I am not optimistic about that. But that is not something the President can currently address.

Posted by: Jack at March 10, 2006 6:47 PM
Comment #132729

As the economy grows more money will come into the treasury to help pay down the debt. I just do not understand why people did not want private accounts for social security. I throught that was a very goog idea.

Posted by: nathan at March 10, 2006 7:10 PM
Comment #132731

I agree with Jack, especially when he says “This is a big problem, but when Bush tried to address it he got fried”

this is a point that must be made and emphasized. Bush addressed the issue, Bush had a solution for the issue, and the dems rejected it flat out because they figure it will get them elected in ‘08. Did u see those unprofessional immature children at the state of the union address?

Posted by: CommonSense at March 10, 2006 7:18 PM
Comment #132733

Could these immature obstructionists win in ‘06. I’m guessing not. The American people vote for “can-do” candidates—who run on ideas—something the dems are bereft of these days.

Posted by: nikkolai at March 10, 2006 7:27 PM
Comment #132737

Jack-
Numbers can help you tell the whole story, but they aren’t the sum of it themselves. That’s why politicians love to use statistics. It helps to isolate policy decisions from such troublesome things like the substance of the facts on the ground.

You’re telling us we have no cause for concern because of where the unemployment and growth rates are now. I hardly think that’s the case. Our multi-trillion dollar debt is cause enough for concern the way its growing.

Economies thrive on trust, and are strongest where it exists at its heights. People don’t trust the economy, don’t trust stockbrokers, don’t trust the businesses out there, and the corporate world has done little to disabuse people of this trust.

When investors and their corporations start using all that growth to invest in more workers, then people will talk about an improving economy. I can tell you on point of fact that you will not feel an economy’s an improving one until you can get a job yourself.

I think it’s more your uncritical acceptance of these statistics than anything else that breeds skepticism.

Posted by: Stephen Daugherty at March 10, 2006 7:59 PM
Comment #132740

Stephen:

From a stock market point of view it’s not that way at all. The stock market climbs a wall of worry. The “mood” is usually backwards. When the “mood” of investors is high it’s time to sell.

What you are discribing is a great big buy signal for equities. When people “feel” uncertain is the best time to invest.

Craig

Posted by: Craig Holmes at March 10, 2006 8:23 PM
Comment #132743

GW has had a pretty good run. The constant negative battering has convinced the “American people” that he is unpopular and some idiots even are calling for his impeachment.

History will show his Presidency has change the course of the Middle East toward Democracy. Unless the media attributes changes in the Middle East to the French or Bin Laden.

Posted by: Reporter for Doody at March 10, 2006 8:43 PM
Comment #132747

Stephen:

There is a big difference to what you say Jack said, as opposed to what Jack actually said.

What Stephen says Jack said:

You’re telling us we have no cause for concern because of where the unemployment and growth rates are now.

What Jack really said:

“the outlook for the immediate future looks good. You can contend that it is gonna get worse, but it is very hard to believe that it is bad now. And predictions of doom are not based on empirical data.
The dept per say is a challenge, but not a killer…The real problem is entitlement - SS, medicare, mediaid etc…So I am not optimistic about that.”

You’ll note that Jack is saying the economy is running pretty well right now, but isn’t predicting the future. The pessimists are saying its bad now and will get worse.

Posted by: joebagodonuts at March 10, 2006 9:33 PM
Comment #132762

just a comment about debt everyone has paid down on it since the first day . it is not totality a age thing remember the eighties and nineties. the factors today are emenise,entitlements are a big factor. mr greenspan’s famous speech about a out of control federal budget, entitlements and trade deficits and education. when it was addressed bush took the bullet i also recall he said all ideas are on the table and nobody seems to want to address the problem at hand, that is coming from both sides of the aisle i have been hearing a lot of doom and gloom lately. as we all can surmise we did not get in this mess overnight they handled the civil war and reconstruction.and the great depresion. if it takes a new goverment i will vote for it. because the one we have now (both sides) are not taking care of it.

Posted by: RODNEY BROWN at March 11, 2006 12:06 AM
Comment #132768

JBOD,

“… Jack is saying the economy is running pretty well right now, but isn’t predicting the future.”

So, if we ignore context, past, and future, we’re looking good?

Posted by: phx8 at March 11, 2006 12:42 AM
Comment #132772

Phx8

What context? Bush hatred? We are looking good right now to anyone who looks without bias.

Compared to most of the years of most of our lives, things are good now.

Let’s make some comparisons. If you look at CBO Projections from ten years ago and today (or 2005, except for unemployment, which is this month.)

Projection for 2006 GDP 11619 B
Real 12 243 billion
GDP growth projection - 2.7% Real 4.2%
Unemployment projected 6%
Real 4.8%
3 month T bill projected 4.8%
Real 3.0
10 yr projected 6.4%
Real 5.4

So we are doing better in most things than we thought we would be. We have too much debt. I agree the USG spends too much money. We also have the entitlements problem. But …

The question I have asked before is what unemployment rate do you believe is sustainable and what growth is “normal”, since 4.8% is too high and 4.2% is too low.

I can concede that we don’t know the future and that entitlements hang over us like the sword of Damocles.

You guys should abandon the things are really bad now argument. People will buy it for awhile, but when they finally figure out the truth it will make Bush look all that much better.

Posted by: Jack at March 11, 2006 1:33 AM
Comment #132776

Jack,
I wrote this last year, on 6/30/05:

“2) If the Fed continues raising the Federal Funds rate, and the 10 year Treasurey Note remains @ 4%, we’ll see an inverted yield curve by the end of this year. Remember, this isn’t like predictions made by economists about the GDP. Bond traders vote with their feet, to the tune of trillions of dollars. And an inverted yield curve is a reliable indicator of approaching recession. We have one year.
For Iraq, it means the US will be going into hard economic times at roughly the same time troop level commitments will become untenable.”

Not a bad prediction. I nailed the prediction of an inverted yield curve. But rates look like they’ll climb higher than I predicted, or anyone else for that matter, and I’d push back the prediction on the recession to this fall, rather than mid-summer.

The unemployment rate is a fairly useless number, Jack. And by the way, I do like the title of your post, & appreciate the humor. In general terms, a low unemployment rate number is better than a high one, of course, but this month gives a perfect example of why it is relatively useless. The non-farm payroll rate came in at a very nice number, yet the unemployment rate increased. The unemployment rate reflects people laid off within the past six months who are actively seeking jobs. Now, the labor pool participation numbers, are extremely low. What does this mean? Are that many people actually out of work? Or are that many people opting out of the measureable, taxable economy, & working in an underground economy, off the radar? Probably the latter, I would guess.

“You guys should abandon the things are really bad now argument.”

In a political sense, I’d agree. No one likes negativism. It’s a little like the Iraqi elections last year. I said those elections were a disaster. However, Republicans were in a veritable ecstasy over the triumph of democracy in Iraq. Were the elections a disaster? Yes. Did liberals like me gain anything by pointing it out? Not really. Shades of Cassandra.

So, you make a good point about refraining from negative comments on the economy. Are we heading for a disastrous recession, in weaker shape than we were in when entering the First Bush Recession? Yes. This recovery resulted in huge deficits & debts, and weak job creation. We’ll enter this next recession without the benefits of surpluses. Is anything to be gained by liberals when they point out the impending train wreck? Not really. Really, it makes more sense to sit back, be quiet, keep ideas to ourselves, and watch the slow motion bus crash take place.

Posted by: phx8 at March 11, 2006 2:21 AM
Comment #132783

I wonder how much of that economic growth is fueled by the Military Industrial Complex. Buying all those smart bombs and humvees on credit would boost the numbers.

Until the war ends and all we have left is debt.

Posted by: Aldous at March 11, 2006 5:55 AM
Comment #132785

Phx8:

Jack has presented numbers in context. What I see from many are complaints about numbers like the unemployment figures. The figures are calculated the same way now that they were during Clinton years. Yet comments from the left make it seem that the numbers are no longer relevent.

The unemployment rate now is similar to that under Clinton. Under Clinton, the unemployment rate was considered very good. Why is it not considered good now? Why is there the intense focus on how the rate is calculated, when its the same as before? Jack has presented it in context with Clinton’s numbers—how is that possibly out of context.

Posted by: joebagodonuts at March 11, 2006 6:53 AM
Comment #132786

I care little that the average wage is up…please give us the median wage, as that is more of an indicator of how much workers are really earning!

Posted by: Lynne at March 11, 2006 10:18 AM
Comment #132787

Lynne

I really don’t know this, so if someone does please step in.

As I understand it, this figure is hourly wage. Hourly wage implies working folks, since the executives and owners get their money via salaries and profits. So the average is a meaningful statistic in this situation.

And if you can find the median hourly wage trend(not median income, which I have found on several occassions) please send a link.

Phx8

As Joe says, the stats are not perfect, but they should be compared over time. If this year sucked, so did every other year of our adult lives except 1999 & 2000.

Talk about cherry picking. You have an extraodinary time (not done by Clinton BTW)at the end of a 16 year growth trend, with the “peace dividend, new technology and a dot.com, ENRON type bubble.) It is like saying that the sprint at the end of a long race is how fast the guy should be running for 26 miles.

Posted by: Jack at March 11, 2006 10:35 AM
Comment #132791

Jack;
So true. It is soo true that it is a shame.

Posted by: cheryl at March 11, 2006 11:04 AM
Comment #132795
I am sure those who wish to will see 0.1%…

Not to be too picky, but this is a an 0.1 percentage point drop, not a 0.1% drop. In percentage terms, it’s about a 2% drop. Not a big deal, but in an age where everything is spin, it helps to rely on real numbers to the degree possible.

What’s most amazing about the “good news” of this wage growth is that worker’s wages might just finally catch up to the inflation rate this many years into the recovery. Huzzah. Let’s hope it’s a very long recovery indeed.

Posted by: Reed Sanders at March 11, 2006 11:26 AM
Comment #132796

Jack,

Touting these statistics as examples of the great job Bush is sad.

Bush has created less jobs than any president since Hoover. Also, who cares about biggest gain in five years? That only means he broke his own miserable record.

Also, please stop slamming liberals for saying that Bush is doing a terrible job on the economy. It is not just liberals. It is liberals, republicans, and third party voters that believe Bush has done a lousy job. In other words, everyone but you and the other Bushies.

I seriously believe you and some of the other posters here that support Bush no matter what he does are seriously out of touch with the republican party.

Constantly noting these small incremental improvements in our economy in an obvious attempt to hoodwink people into believing everything is great only hurts Bushie credibility. If only to make Bushies seem more believable you should disagree with him, just once.

Posted by: Max at March 11, 2006 11:29 AM
Comment #132800

Correct me if i am wrong, but say for instance a company just picks up and moves to a different state, taking all those jobs with them— doesn’t that get counted as “new job creation” even though there is no net gain in jobs?

Posted by: tree hugger at March 11, 2006 11:59 AM
Comment #132802

treehugger:

You are probably correct on that, but if we want to keep numbers in context, they’ve always been counted like that.

I know a local company that developed a branch store—sort of a factory outlet—and staffed it with existing employees. The name of the outlet is slightly different, which allows it to be considered a different company, which allows them access to job creation money. No jobs were actually created, but the governor actually used them as an example of job creation.

But…when looking at numbers, you have to look at them the same way for different periods. If we take at face value one set of numbers, and critically attack a second set of numbers that were created in the same way, we then do a disservice.

Posted by: joebagodonuts at March 11, 2006 12:21 PM
Comment #132803

Jack,
How can anyone worry about past, present, or context, when this months’s numbers are so good?

Bush after 62 months: 2.318 million jobs created

Clinton after 62 months: 15,089,000 jobs created

Non-supervisory wages have been stagnant during the Bush administration. Supervisory wages have risen more than non-supervisory wages. This latest wage number is good, because ‘the little guy’ made a little headway. It is a cause of concern, because its pressures can be inflationary. That means rates will continue rising. For the past two years inflation has been in the 3 - 4 percent range with an upward trend, which also keeps interest increasing.

According to Greenspan, from 2001 to the end of the third quarter of 2005, consumer debt increased from $7.1 trillion to $11 trillion. Last year was the first time we’ve seen a negative savings rate since 1933.

So! Let’s recap. 4.8% unemployment rate. Good. 243,000 non-farm payroll jobs created last month? That’s good.

Let’s put it in context. Where do you think the economy is heading? Will it have repurcussions for the 2006 midterm election?

Posted by: phx8 at March 11, 2006 12:22 PM
Comment #132807

First and foremost,let me set out that my view is that we could be seeing growth. Personally, though, I’m not at all convinced that today’s growth is the best we can or should be doing. I think information technology has created real dividends in the way business operates, and that it has already meant a substantial improvement in the capacity for businesses to run more efficiently

I think Bush’s policies, the encouragement of debt financing on consumer, federal and corporate levels, are acting as a dead weight on that.

I think too many people see the economy only for the numbers, and act like it’s an exact science, instead of one of the softest of the soft sciences, if it can be called a science at all.

Numbers alone don’t say everything. They can help to describe a system, but they can’t substitute for on the ground knowledge of the conditions going on.

Right now, we are abyssmally ignorant of what’s going on in our economy. We don’t know whether our current economy is a true representation of growing economy, or a false representation of a dysfunctional economy that’s failing to take advantage of new technologies and better business leadership.

This is what Republicans miss about the regulations they struck down, and how that contributed to all the bubbles. They did so many things with accounting and laws concerning the behavior of financial institutions with the war cry of doing it for the economy. Unfortunately, they only thought one-dimensionally, about profits and costs. They didn’t think that loosening these restraints would make it more difficult for the economy to run smoothly, for expectations based on information to pan out. The Republicans may say caveat emptor, but if nearly every economic purchase you make is either a naive move on your part, or an overly cautious one, the economy will not function correctly.

The question is not whether we’re pessimistic or optimistic about the market. I find those to be fairly useless questions. What I find useful are questions as to what problems are persistently popping up, who’s not telling me the truth about their finances (and who is), and what markets are overblown, overloaded with debt, or just plain not where the action is at.

The Republicans have gotten into this relentlessly short term point of view, only thinking as far as the next quarter, if that. They trumpet numbers that may be up one quarter, and down the next. I hardly hear much original thought from them as to what technologies might be of interest. Some people made fun of Gore when they falsely assumed he said he invented the internet, but the fact is, He and Bill Clinton were talking about the information superhighway long before it was a fully realized dream. They were thinking years into the future, rather than months.

There needs to be a greater focus among Republicans to the real health of the economy. Unfortunately, the Republicans seem intent on undermining everything that makes us a viable consumer market, consoling us that they’re allowing the market to do what it wants, and by that we will prosper.

That’s what disappoints me about this post. It has no vision. Just some dogmatic point about how our intuitive picture of the economy (which might have the better read of the situation) is wrong just because of some statistics. Well, we don’t live in a ledger.

An consumer economy that does not keep debt low, doesn’t retain paying jobs, and which funnels more money to the rich few is one heading for stagnation. Where we’re heading matters just as much as where we are.

Posted by: Stephen Daugherty at March 11, 2006 1:08 PM
Comment #132809

Jack, there are many avenues to a destination, some far more efficient and wholistic than others. Bush’s answer to the economy is the same as a 15 year old just handed a fistful of credit cards. Sure, the kid can look prosperous and incentivize others to lavish attention on his short term appearance of wealth. But, the bills will come due and the 15 year old will go bankrupt or have to skip town to evade the creditors at some point.

Additionally, this administration has stimulated the economy through tax breaks for corporations and the wealthy investors far beyond what is sustainable for the nation’s credit-worthiness. In fact, many economists are now arguing the economy has been, or is about to become overstimulated, fueling inflation and steadily increasing interest rate hikes. But the key point is, this is not sustainable, this massive record setting deficit spending to support the economy.

The fact is, this administration’s policy is based on a continual growth of labor force willing to accept increasingly lower gross compensation packages for their labor. That spells social and political upheaval, some of which is now beginning to become evident as on the immigration issue, where Bush continues to put free markets ahead of security and quality of life issues for the majority of Americans.

Posted by: David R. Remer at March 11, 2006 1:13 PM
Comment #132812

Max

Economics - Everything takes time to work through the economy.
Chronology – the markets started to decline in March 2000. Bush became president in Jan 2001.
Federal Budget — the fiscal year starts in October. Until October 2001 we were working with Clinton budget priorities.
Chronology 2 - job losses took place when?
Politics – President (unless they hire directly) don’t create jobs.
Common Sense - 4.2% economic growth and 4.8% unemployment are great
Common sense 2 - the economy will not get much better than it is now. If you don’t like it, you are out of luck.

Phx8

The economic recovery began in March 1991. Clinton came at the job much later in the recover stage. The comparison years for Clinton should be 1994-5 (compared to 2004-5). Were those the years you were using? It is not an honest comparison to take the first 62 months, since the first 24 months are not really the doing of the Pres anyway.

Posted by: Jack at March 11, 2006 1:21 PM
Comment #132817

And it sure would be nice for all the economic cheerleaders out there to realize that, like phx8 pointed out, when jobless claims are down (yeah I know - they’re actually up .1%), it doesn’t mean that the US economy is kicking ass for the average US worker. Take a look at this from the employment outlook for the Greater Houston area, which shows you what kind of wonderful jobs we here in America are creating with our badass trickle-down economic policies:

http://www.tracer2.com/admin/uploadedPublications/1673_Gulf_Coast_WDA_Highlights.xls

Robust is not a word I’d use to describe our local economy here, although I’m not a nurse’s aide, fast food worker, or cashier.

Also, speaking of the average American worker, when it comes to these stats, he or she may be:

-participating in a job where they earn under the table wages (they might, for example, be selling drugs and have decided that it’s just too much trouble to turn in a job search log each week in order to remain eligible for unemployment insurance)

-newly employed for MUCH less money than they were previously making

-or they might have exhausted their unemployment benefits - and therefore NOT be counted in these statistics

-in fact, they may have just simply stopped looking for work altogether - they may, in fact, have lost their home and be living on the street. You know how we could see 0% unemployment? If everyone collecting unemployment insurance simply stopped calling in to collect their weekly benefit check. Does that mean they have all found work that adequately compensates them to maintain anything close to their previous standard of living? Of course not.

You see, these numbers completely ignore these very real possibilities that are happening every day.

Profits are up? Great! GDP rising? Hooray! Annualized wages up? Terrific! Burger King hiring? Yippee!

Show me how it all amounts to more than a hill of beans and you’ll have convinced me that our leaders in Washington deserve some praise. Until then, it’s all just snake oil and smoke and mirrors.

Posted by: macsonix at March 11, 2006 1:58 PM
Comment #132818

phx8 those numbers on bush jobs created sound a little low your figure of 2.318 million are the one’s i keep coming up with as of febuary 2004. i cant find the real numbers as of today .i am sure jack or someone else could

Posted by: RODNEY BROWN at March 11, 2006 2:12 PM
Comment #132821

try this link instead - click on the “download publication” link on the page.

http://www.tracer2.com/publication.asp?PUBLICATIONID=1673

Posted by: macsonix at March 11, 2006 2:24 PM
Comment #132824

macsonix got ya . like greenspan says education, education, education! even a community college will do.

Posted by: RODNEY BROWN at March 11, 2006 2:47 PM
Comment #132825

are you saying I need more education or the average American does, or the average Houstonian?

My point is: what good does more education (not to mention higher debt from student loans, if you can get them) do for you if the preponderance of new jobs being created by the “robust” economy are fast food workers and cashiers?

Posted by: macsonix at March 11, 2006 2:57 PM
Comment #132828

LMAO—- does anything make it into the Red
Fanasy bubble you people live in?
Bush is your Jim Jones but for most of
America the Kool Aid has turned to sour grapes.

Posted by: Honey P at March 11, 2006 3:26 PM
Comment #132829

David:

In fact, many economists are now arguing the economy has been, or is about to become overstimulated, fueling inflation and steadily increasing interest rate hikes. But the key point is, this is not sustainable, this massive record setting deficit spending to support the economy.

I disagree with your words “now arguing”. The fed has been stating that fact for many months now. Their policy along with lower tax rates and defict spending has been stimulating the economy. The fed notes for some time have reflected an intention to remove the stimulation.

Many economist ARE NOW ARGUING that the fed should stop raising rates as they are begining to restrict growth and slow the economy down. Current thought is about when the fed will stop raising rates on if. These shifts in policy are normal as the economy moves between a band of too slow of growth (higher unemployment, job layoffs etc) and too high of growth (inflation).

The current “NOW ARGUING” is to stop raising rates, the “PAST ARGUING” is as you have stated.

Craig

Posted by: Craig Holmes at March 11, 2006 3:36 PM
Comment #132831

Stephen/David/Jack:

As I have said many times here, (and never convinced anyone ), you cannot on a long term perspective give credit to democrats or republicans for better ecnomomic growth. Democrats want to point to Clinton and forget about Carter. Republicans want to look to Reagan and forget about Hoover. Over the years the economy does fine under the management of both.

Craig

Posted by: Craig Holmes at March 11, 2006 3:38 PM
Comment #132832

kctim,

If the voters wont vote for you because of your agenda, scare them into voting for you.
Which goes a long way to explain why the the Bush administration raised the terrorist threat level ten times during the campaign but not once since then, right?

Posted by: ElliottBay at March 11, 2006 4:00 PM
Comment #132838

macsonix, me telling a texan they need more education dont think so!!! i believe an our community colleges! our city has expanded there growth at twice the capacity in the last 4 years iv,e seen a lot of young people moving to other area,s out of the state to nail that job, as for california these days ??? that i can agree with you. by the way my dads uncle moved to brownsville about 70 years ago. cotton.

Posted by: RODNEY BROWN at March 11, 2006 4:59 PM
Comment #132840

Craig,
Actually, the stock market does better under Dems than Reps, by a considerable amount.

Under Carter, over 10 million non-farm payroll jobs were created in 4 years.

And yes, Rodney, I’m sure, after 5 + years of Bush, we’re looking at a total of 2.3 million non-farm payroll jobs created. Yes, it’s that bad. Keep in mind, too, that the population is considerably larger today than under Carter. And, keep in mind Bush administration policies produced only 2.3 million non-farm payroll jobs while the population grew by 12 million. Yes, it’s that bad.

This most recent jobs report was the best in quite a while. That’s why the DJIA increased over 100 pts on Friday. Stock markets are leading indicators of economic performance. They quantify our hopes & fears, our optimism & pessimism, our confidence. When it comes to Bush & Republican economics, the markets have voted with their feet. An investor putting money into the lowliest bonds would have creamed stock market investors these past 62 months.

Stephen,
Optimism, pessimism, consumer confidence, and investor confidence are closely related. In a sense, the entire ‘free market’ is an illusion which we collectively agree to accept. When we go to the store and offer the clerk $5 for a box of Captain Crunch, the clerk accepts a relatively useless piece of paper in exchange for food. He accepts it because money is backed by the full FAITH and credit of the US. We all believe.

I’d argue the continued atmosphere of fear cultivated by the Bush administration contributes a depressing effect on the economy. Even today, we’re on “Yellow Alert,” which means there is a “significant” risk of terrorist attacks. Incredible. In addition, the cronyism and corruption contribute to the depressing effect as well.

Pissing away hundreds of billions of dollars on Iraq doesn’t exactly help matters.

Record breaking federal spending on useless crap doesn’t help either. If all this spending went towards wiping out poverty, or creating a national health program, or something worthwhile, at least there would have been a point to it, whether good, bad, or indifferent. Instead, we’re pissing away money on the newest generation of air superiority fighters and the newest generation of nuclear attack submarines, and pork. The Republicans are treating spending like a Seinfeld episode. It’s all about nothing, and lots of it.

Posted by: phx8 at March 11, 2006 5:11 PM
Comment #132847
…from 4.7% to 4.8%. Pessimists may make the most of it.

Wrong. Nobody ever said 4.8% unemployment is bad. Not historically, anyway. The more important point is the rise, when you also notice a rise in inflation and interest rates.

But, even those three cherry-picked items are not alarming.

What is alarming is the whole picture:
[01] 67% National Debt to GDP (up from 33% in 1980) has never been higher since World War II .
[02] $8.2 trillion National Debt which has never been higher.
[03] Deficits continue to grow fast.
[04] $40.2 trillion nation-wide debt has never been higher.
[05] more …

Ummmm….sorry, but how about the 34+ things above ?

Oh…right. Shhhhh!

  • First, put on your rose-colored, partisan blinders.
  • Now, repeat after me:
  • Everything is OK
  • Pay no attention to the crooks behind the curtain.
  • Unemployment, inflation, and interest rates are rising, but they are low; don’t pay no mind to everything else.
  • Everything is good
  • Don’t be confused by the facts. Unemployment, inflation, and interest rates are low.
  • Keep votin’ the party line.
  • Don’t listen to any other facts, no matter how true.
  • Everything is very good
  • AAuuuuuummmmmmmm …


Posted by: d.a.n at March 11, 2006 6:08 PM
Comment #132848

How about Bush’s approval/disapproval rating 38%/60% ?
Why are Republicans distancing themselves from Bush?

Posted by: d.a.n at March 11, 2006 6:16 PM
Comment #132854

phx8 i agree with some of your post, it is just the numbers i am getting seem to be different ive looked on the web and it showed mr carter at 7.596 million non farm payroll jobs 4 years very good! ..inflation rate under carter 14% very bad.! interest rates under carter 18% very bad! misery index rose 50% very bad! . under reagan non farm payroll jobs at 16.885 million 8 years excellent!inflation rate dropped to 4% excellent! interest rates dropped to 7.5% excellent! and the misery index dropped 30% excellent! i thought some of the other factors were worth talking about. do i expect to see those numbers under bush , no i never said that.

Posted by: RODNEY BROWN at March 11, 2006 7:18 PM
Comment #132859

Rodney,
http://en.wikipedia.org/wiki/Jobs_created_during_U.S._presidential_terms

Bureau of Labor Statistics is also a useful site.

Carter served as president when an inflation peaked. The trend started in 1965, and rose over the next 15 years. Carter appointed Paul Volcker, who raised interest rates to very high levels.

The Reagan administration objected vehemently to Volcker’s program. The high rates took out inflation, but at the cost of the most severe recession since the 1929 Depression.

When inflation abated, Volcker flooded the economy with money, sparking a seven year expansion.

This period of US economic history was dominated by monetary policy. Mistakes with fiscal policy were corrected by the Fed’s monetary policy, and the correction was very harsh.

Posted by: phx8 at March 11, 2006 8:04 PM
Comment #132860

phx8


Craig,
Actually, the stock market does better under Dems than Reps, by a considerable amount.

Like I said, the ECONOMY does just about as well during democratic administrations as republican.

Under Carter, over 10 million non-farm payroll jobs were created in 4 years.

Yes but take a look at the misery index. This was an index Carter used to defeat Ford. The misery index is the rate of inflation plus the rate of unemployment. Carter wins the award!!

http://www.miseryindex.us/indexbyyear.asp

And yes, Rodney, I’m sure, after 5 + years of Bush, we’re looking at a total of 2.3 million non-farm payroll jobs created. Yes, it’s that bad. Keep in mind, too, that the population is considerably larger today than under Carter. And, keep in mind Bush administration policies produced only 2.3 million non-farm payroll jobs while the population grew by 12 million. Yes, it’s that bad.

This is only because you are viewing this data through a political prism. If you look through an economic prism you would compare numbers not on the basis of presidential elections, but rather from the same point in an economic cycle.

Economists (nonpolitical) would view the jobs growth in this cycle as fine it is producing enoough jobs to keep the unemployment rate reasonable. What economists are thrilled with is the wonderful increases we are seeing in worker productivity.

This most recent jobs report was the best in quite a while. That’s why the DJIA increased over 100 pts on Friday. Stock markets are leading indicators of economic performance. They quantify our hopes & fears, our optimism & pessimism, our confidence. When it comes to Bush & Republican economics, the markets have voted with their feet. An investor putting money into the lowliest bonds would have creamed stock market investors these past 62 months.

This part is hogwash. Money travels to where it is treated best, In the past five years this has been in real estate and commodities. We should not pick a certain market for political expedience. There is nothing wrong or right with making money in real estate instead of stocks. How people feel about the economy is just about the same now as it was 10 years ago.

It would be wiser to get economic perspective from other than political sourses.

Craig

Posted by: Craig Holmes at March 11, 2006 8:12 PM
Comment #132863

Dan

Your source shows the debt ratio today is the same as it was in 1995 and the trend then was even more troubling since it was rising even faster.

It is foolish to be too optimistic, but it is equally foolish to be too pessimistic. Both will lead to bad decisions.

The economy today is similar to the economy of the middle 1990s in most respects. It is not perfect, but it is very good.

Phx8

The figures of jobs created by presidents is hogwash for two reason. First, presidents don’t create jobs. Their policies help create conditions that help create jobs. Second, we have the lag time in their policies. You probably have to add two years at least to the end of each term and subtract it from the start.

The analogy I used before makes sense. If a man (who is not a sperm donor) meets a woman for the first time when she is already six months pregnant and marries her on the day before the child is born, is he the biological father?

As you know, I like Clinton, but virtually all the job loses of 2001 and most of those of 2002 were lost when Clinton policies still ruled the economy. He is the father of the economy of 2001-2002, just as Bush I was of 1993-4, and Carter was of 1981-2 (such as any president can be). Given the nature of recessions, I bet the numbers are really different than those on the chart.

So unless you are prepared to believe that you got a girl pregnant on the day before she gave birth, you should not believe the idea of job creation based on terms in office.

Posted by: Jack at March 11, 2006 8:43 PM
Comment #132864

Craig,
“Money travels to where it is treated best.”

And referencing my comment on the stock market as a leading indicator: “pure hogwash”.

By your definition, whichever market is rising- equities, real estate, commodities- that market must be the leading economic indicator; and, since a market of some form, somewhere, must be rising, the economy of Rosyscensioworld must always be doing well. Do you want to stand by that? The stock market is a decent leading indicator; personally, I prefer debt markets to equity markets as a leading indicator.

“Economists (nonpolitical) would view the jobs growth in this cycle as fine it is producing enoough jobs to keep the unemployment rate reasonable.”

That is wrong. No economist cares about the unemployment rate. The unemployment rate is not the same as job creation. The unemployment rate measure the number of people who have lost jobs in the past six months, and are actively looking.

“What economists are thrilled with is the wonderful increases we are seeing in worker productivity.”

No. Economists are interested in more than increased business profitablility. The money must be available for consumers to spend in the form of modest wage growth, in order to stimulate economic growth- preferably not by consumer borrowing, which is what we’ve seen under Bush. Modest wage growth leads to consumer spending, which leads to more businesses, job creation, and so on.

Posted by: phx8 at March 11, 2006 8:47 PM
Comment #132865

d.a.n. my buddy mr truman’s approval was at 28% when he left office i consider mr truman as a great president. bill clintons lowest rating was 36% and a darn good president. mr carters lowest rating was at 28%. mr johnson’S lowest rating was at 33%. mr fords lowest rating was at 37%.and a good president.

Posted by: RODNEY BROWN at March 11, 2006 8:49 PM
Comment #132866

Jack:

This is the closest I could come with a “quick and dirty” search…

http://www.epinet.org/content.cfm/issuebriefs_ib196

Doesn’t look much like media wages nor real wages are measuring up to real needs.

Posted by: Lynne at March 11, 2006 8:53 PM
Comment #132867

This frigid weather, heavy rain, 50mph winds have got to be affecting the brain…

It’s the MEDIAN WAGES and real wages that are not measuring up to snuff.

http://www.epinet.org/content.cfm/issuebriefs_ib196

Posted by: Lynne at March 11, 2006 8:55 PM
Comment #132868

phx8:

Let me narrow down what is pure hogwash.

When it comes to Bush & Republican economics, the markets have voted with their feet. An investor putting money into the lowliest bonds would have creamed stock market investors these past 62 months.

Just a part of this might have been the NASDAQ going from 5000 to 2000 before Bush was even elected. Investors chose another investment vehicle to put money into. It was simply investments cycling through. Now with Real Estate leveling off/falling, plus time from the stock market bubble, it is likely that the stock market will cycle back to the front again. If that happens it is not because Bush is a great president. It is just normal market cycles.

If you look at the stock market chart here:

http://bigcharts.marketwatch.com/quickchart/quickchart.asp?symb=spx&sid=0&o_symb=spx&freq=2&time=13

Make sure and look at SPX for the last decade. It is clear that the market decline began in 2000 while Clinton was president.


THE TRUTH is that the market grew during the economic expansion from 1990 to 2001 and did predict the 2001 recession. But it also predicted the 1988 recession (1987 crash). This expansion is different from previous expansions because expansions usually are different from each other as the world economy is dynamic.

This economic expansion is stronger in some areas, and weaker in others. To give Bush credit for the stronger parts, and Bush blame for the weaker parts is hogwash. Presidents don’t have that much power.

Craig

PS. I will give you a hint who has more power than a president to effect the economy. The federal reserve!!

Posted by: Craig Holmes at March 11, 2006 9:04 PM
Comment #132869

Lynne

Thanks.

But just to the one technical point, I still am not sure what the average wage measures. Your source leads me to believe that it is measuring the compensation of workers, but I still am not sure.

Posted by: Jack at March 11, 2006 9:10 PM
Comment #132871

Phx8:

Economists are interested in more than increased business profitablility.


?? not sure why you would bring this up from your perspective. S&P 500 companies just sent a new record of consecutive quarters of double digit year over year increases in profitability. Corporate american profits are through the roof and climbing.

Corporate balance sheets haven’t been in this good of shape in decades. Large corporations are awash in cash (Several Trillion). Many are using their cash for stock buybacks, etc. Corporate profitablility is not the place you want to attack the economy if you are trying to make political gain.

If I were on the left, I would make the a political case on median wages. It’s a much stronger argument.

Craig

Posted by: Craig Holmes at March 11, 2006 9:15 PM
Comment #132875

MESSAGE TO THE LEFT:

You are making the wrong argument on the economy.

If you look at the economy on a national level it really does do just about as well when either party is running things

HOWEVER, not every part does as well.

What part is not doing well NOW. WORKING FAMILY REAL WAGES.

Corporations and the top half of the economic bell curve are doing great, and I don’t believe it is necessarily because of Bush’s tax cuts etc etc.

I think it more has to do with the transitioning economy and the the upper half of the economic bell curve have more skills to adapt to this new reality.

Now that the world is flatter, (Friedman), basically, due to the internet there is a world glut of workers, (India China etc) which (because of the internet again) increased production, and at the same time keeps wages low.

NOW LISTEN HERE, BECAUSE THIS IS A GREAT LIBERAL ISSUE!!!!

The last big threat to our economy came from Communism. Wow when Sputnick went into orbit so did we!! There was a tremendous push in education in order to compete. Which party was in charge then?

If you will do the research, what the record will show in the 60’s, and 70’s was a liberal approach that worked. It was the democratization of higher education. If you look early 1960’s and earlier, verses late 60’s through the70’s you will find dramatic increases in higher learning. This was not just because of the baby boomers. It was percentage of High School grads attending colleges. Liberals tore down the barriers to let average students attend college.

SAT scores declined, NOT because public education “declined” SAT scores declined because now “C” students could take the SAT!! This success in your (liberal) heritage. (It is also probably why US colleges are liberal to this today).

Instead of this constant peeing match between comparing the Bush economy to the Clinton economy (which I do believe is hogwash), why not use your heritage, rework it into a great program to help the working class compete in this new economy? In other words LEAD!! This anti Bush thing really is getting older and older as Bush’s days get fewer and fewer.

You have all the principals you need, (and the data to back it up) if you will just cross reference America’s response to the economic threat from Communism to the threat (economic) from the flattening of the world. (Friedman) The democratic party led the way, and America was better for it.

In summary, your arguments about the current economy being poor are wrong. (This economic cycle is doing just fine). However you have a great argument with the struggling working class, that is right out there for you on a silver platter, and you have the answer (education/retraining). Go get it.

Craig

Posted by: Craig Holmes at March 11, 2006 9:59 PM
Comment #132878

People are right when they say a president doesn’t have control, in the classical sense, of the economy. That doesn’t mean that decisions by a president, well-intentioned or cynical, can’t have effects on the economy. Ask LBJ what came of huge new entitlements and a deficit financed war.

Posted by: Stephen Daugherty at March 11, 2006 10:19 PM
Comment #132879

Craig,
Now we’re in synch, on wages, and on the nature of the recovery. GDP growth has been good. Corporations are in great shape. Agreed. GDP is actually weaker than previous recoveries, which some Dems attack, but I don’t buy into it. The problem is not with the GDP numbers, but the policies guiding the distribution of that growth, and of those profits.

In a nutshell, Bush administration policies favor the wealthiest top percentiles at the expense of everyone else.

We see that reflected in lack of wage growth. We also see it in the lack of job creation. Yes, I’ve read Friedman, and I agree with about half of what he says. Great ideas though, very readable presentation, and I’d encourage anyone to read at least one of his books.

By the way, as powerful as the Federal Reserve may be, the position of president is still the most powerful single influence on the economy. The Federal Reserve can only control monetary policy. That’s huge, don’t get me wrong. But the president controls fiscal policy. The president appoints the Chairman of the Federal Reserve, leads fiscal policy, controls the Treasury through that cabinet position, signs treaties, same with the SEC, has the position to veto budgets, leads his political party and its economic platform, and so on.

Posted by: phx8 at March 11, 2006 10:25 PM
Comment #132880

ARGUMENTS FOR THE LEFT CONTINUED:

As a republican this is kind of fun.

Why is inflation so low? The biggest component of the CPI is wages. Unit labor costs are low because of global competition and higher productivity.

One would think that the stock market being flat is because corporate profits are low. (stay with me here). That is not correct.

If you look up P/E ratios, what it will show you is that Earnings (profits) have risen dramatically in the last few years. Truthfully at a record setting rate!! When measured on a year over year basis, Corporate profits have grow over 10% per year for over 14 quarters. This has never happened before.

STAY WITH ME.

In fact if you look at how much cash is in the corporate wallet, it has almost never been this high.

DON’T FALL ASLEEP.

Put two and two together. Wages of YOUR CORE CONSTITUANTS (wage earners) are low, which is creating RECORD PROFITS for wall street.

THIS NEXT PART IS VERY IMPORTANT

Google “Stock buy backs” or “Stock Repurchase plans”. What you will see is that corporations are buying back their own stock in large numbers.

WHY WOULD THEY DO THAT?

Is because stocks are undervalued, and they (professionals) no a good buy when they see it.

WHAT WILL THEY DO WITH THAT STOCK?

Much of it will be used for incentive bonus’s for executives. STOCK OPTIONS!! (among other things).

SO HERE IS THE BASIC EQUATION:

Because of global competion, YOUR CORE VOTERS, are making less money that is increasing corporate profits which are being used to buy back corportate stock (at least part of it) to fund stock options for executives in the future.

IF THE ECONOMY IS SO BAD, WHY ARE CORPORATIONS BUYING BACK THEIR OWN STOCK. (THINK THINK THINK) OK HERE IS THE ANSWER: BECAUSE THE RICH PEOPLE WHO RUN CORPORATIONS BELIEVE THE STOCK IS GOING TO INCREASE!!!

WHAT WOULD I DO IF I WERE A LIBERAL?

(First read previous post). I would tax corporate stock purchases from excess profits, and uses thos dollars to fund training programs for workers.

If you take the money directly and give it to workers you aren’t fixing the true problem. Remember there is for all practical purposes an infinite supply of cheap labor thanks to the Internet. The only answer to really help the working class that I know of is increasing their job skills. Anything else just sends jobs overseas.

WHY SHOULD THE GOVERNMENT DO IT?

Because capital is going to flow to cheap labor. Business doesn’t care where it gets the labor it needs. Capital will just flow to the most efficient sourse. (It is very impersonal). If one corporation trys to do the right thing, they will just go out of business by a competitor.

As a moderate republican, this is the type of thinking I could support and vote for.

The current Democratic thinking seems petty and shallow, and bitter. Even if I am not happy with my own party, I currently can see no reason to change, because right now, I see no vision from the otherside. It feels weird having to create the vision from the right.

Craig

Posted by: Craig Holmes at March 11, 2006 10:31 PM
Comment #132883
However you have a great argument with the struggling working class, that is right out there for you on a silver platter, and you have the answer (education/retraining).

Craig,

Although I think a large part of your analysis is correct, both the dynamics of the social division and the potential ways of resolving it are a matter of debate. For a quick overview, see a recent piece by Mark Schmitt.

What is comes down to this: the polarization of the labor market isn’t caused by either of the two major U.S. parties, but they might be able to react to the problem in ways that make sense. Schmitt suggests policies that would allow more Americans to enjoy the benefits of capital growth. Such ideas make sense to me but I see little hope that they’ll be implemented in our current era. Things will need to get worse before they can get better. The only silver lining is that, given our current trajectory, we can feel confident that things will indeed get worse. My biggest concern is that our democratic and constitutional system is being destroyed, essentially cutting off the feedback loops that would make a needed course correction possible.

Posted by: Reed Sanders at March 11, 2006 10:57 PM
Comment #132894

Craig,

interesting….

Posted by: Tom L at March 11, 2006 11:28 PM
Comment #132895

Reed:

Thanks for the reponse. I read your link. (Thanks). The list of solutions mentioned do not attack the issue directly from my perspective. I really see no “solution” other than increasing job skills. I think we can do some things to make people more comforatble in their current state (ie univeral health coverage), (which I am not arguing against), but the point to me is to allow the lower half of the bell curve to enjoy the fruits of the american economy.

What I liked about your link is that he correctly sited Clinton and Nafta as having an effect. The Democrats are the answer and Repubicans are Satan argument to me doesn’t fly. Besides, elections are about the future. For these americans to compete and have a lifestyle that is traditionally the american dream, (raising living standards from one generation to the next), do you see another answer other than dramatically improving job skills of the working class? I can’t see any. (I am not saying thay are not there, I just can’t see them).

This kind of debate I can get excited about. Much of what is debated is cyclical. Stocks did better in Clinton’s term, Real Estate in Bush’s. Who cares. What is going to be with us for a long time, in both Democrat and Repubican administrations is the effects of globalization, and the stagnation of the economics of the working class.

It is imporatant to find real solutions. I would offer the American higher education experience of the 60’s and 70’s which democratized higher learning as an example of what america is capable of. I don’t think one can cut and paste as the world has changed. However what we can do is recreate the idealism, and expand higher learning to misplaced workers.

I have been trying to find out how much money corporate america has in liquid investments. It seems to me that it is somewhere between 1.5 and 2 Trillion. It is pretty high.

Craig

Craig

Posted by: Craig Holmes at March 11, 2006 11:28 PM
Comment #132905

Craig,
Part of the problem has been the replacement of high paying jobs with low paying jobs. While we would all like education to be the answer, it is not. Globalization is killing us. Advances made with computer networks combined with the availability of english speaking foreign workers abroad who are willinig to work for a fraction of a US worker’s cost, spells disaster. Because now, it is not the lower paid jobs being outsourced. It is not the jobs that require low levels of education which are going away, but the programmers and techs. It is precisly the best educated people who are losing their jobs, such as programmers & people in IT and engineers.

We have found a way to outsource our technological lead. We have found a way to outsource our ability to invent, and our ability to innovate.

It’s very, very profitable for corporations.

It’s disastrous for working Americans. And no amound of education will change this.

Posted by: phx8 at March 12, 2006 12:06 AM
Comment #132917

footnote about president truman rx; anisometropia with diplopia with refractive amblyopia OU. dry refraction best rx od 20/50 os 20/40. and a ww1 hero !

Posted by: RODNEY BROWN at March 12, 2006 1:23 AM
Comment #132919

Craig,

Expanding skill levels is a fine idea, but it’s just not the whole answer. The literature shows that there are huge numbers of Americans who simply can’t be “upskilled” sufficiently to make it work. And it’s also true, as phx8 says, that even a very good education doesn’t prevent your job from being sent overseas anymore.

There aren’t any simple, single answers, and we shouldn’t be afraid of the complexity of the problems. It has to be a combination of things: better skills, yes, but also smarter government policies, a more thoughtful and active citizenry, and morally decent and intelligent leadership.

Posted by: Reed Sanders at March 12, 2006 1:28 AM
Comment #132926

The problem is that the right favors an obscenely passive way of dealing with globalization. Their response to outsourcing: let it happen. Their response to outrageous cheating on the part of our major trade partners in terms of free trade? Let it happen.

Why all this? Because it’s what the corporations want. Except this can’t go on forever. America is going to reach a breaking point, sooner or later, and free trade as the Republicans want it will quickly become a third-rail. Maybe today’s corporations have no patriotic loyalty, but many Americans do, and when the time comes, many companies might find themselves on the wrong side of a very pissed-off consumer economy.

If companies from abroad want to compete with us, they do so on even terms. If they raise a tarriff, we mirror-image it. For every dollar a company saves in wages by outsourcing, perhaps they should have to contribute a dollar in taxes. Sooner or later, though, we have to recognize that there is efficiency, and then there’s efficiency. I don’t want protectionism- we should have to face competition from foreign companies. I don’t think we should have defenselessness either, though.

Posted by: Stephen Daugherty at March 12, 2006 2:20 AM
Comment #132948

Stephen,

It’s relatively simple to incorporate labor standards, environmental regs, intellectual property protections, etc., into trade agreements. More of that is virtually inevitable and, yes, we need an administration that will do it.

But globalization is a done deal for now, barring some major global crisis. So, we need to put our own house in order. This means reducing deficits, making sure that people who work hard don’t live in poverty, investing in education and infrastructure, vastly reducing our greenhouse gas production, leveling the global business playing field via some kind of healthcare program that’s not connected with employment, and making sure that the people who are creating most of today’s wealth through incredible productivity growth are actually reaping the benefits of that wealth. The last of these will ensure a sustainable economic and social future, but it’s simply not on the radar screen of most folks.

In the meantime, work hard to keep the U.S. an actual democracy with constitutional protections as opposed to the souless, badly disguised fascism of a plutocratic system that’s utterly lost its way.

Posted by: Reed Sanders at March 12, 2006 10:05 AM
Comment #132960
Jack wrote: d.a.n Your source shows the debt ratio today is the same as it was in 1995 and the trend then was even more troubling since it was rising even faster.

No, not true.
Debt to GDP was 67% in 1995, and falling fast.
Now, Debt to GDP is now over 67% in 2006, and rising fast.
Big difference, but that’s an expert attempt to obscure the issue (i.e. make it look rosier).

But, other than these other 34+ things, everything is “very good”.

Posted by: d.a.n at March 12, 2006 12:05 PM
Comment #132961

The deficits are not a laughing matter. We may well be in the midst of a lull before the storm (i.e. the storm being the debt and deficits).

So, what is the planned deficit for 2006? $400 billion?
And, $200 to $400 billion deficits are planned to continue each year, all the way through 2015 (provided nothing bad happens to make it worse).

The thing that most people don’t understand is how long it takes for decisions this year to be felt in subsequent years. It fosters a belief that we can do almost anything we want with out consequences.

It breeds the rose-colored-glasses syndrome, along with which party, at the time, happens to be the In-Party.

The deficits will become a drag in a year or less on the economy. Both inflation rates and interest rates are starting to increase, just as many predicted. Economic growth will attempt to keep up, but economy can not grow fast enough to keep up with the massive deficit. Hurricane Katrina isn’t helping matters. Where is all of this money coming from? Sure, we can print more money, but that causes inflation. We could cut expenses and/or raise taxes, but it would still not be enough. The economy may continue to grow despite horrible government dysfunction. This month, there was an inverted Treasury Yield curve. Historically, a recession has always followed soon after. Will it this time? Even the Federal Reserve Bank is concerned that within the next several years our huge deficit will begin to result in the potential for a massive increase in inflation, because, when the Federal Reserve raises short term rates, long term rates will follow (increase) also. And CPI is increasing too. So, the Federal Reserve will probably keep raising rates all through 2006, and this will most likely slow the economy. But, as the debt and deficit grows larger and larger, all of those rates will grow even larger for the years that follow it. It is a snowball effect, growing larger and larger, and eventually, out of control. By the time everyone agrees that the fiscal policy is bad, it will be too late. For now, the GDP will continue to grow, but not as fast as predicted, due to Katrina, Iraq, the growign debt and deficits, and continued falling real median wages, higher energy costs, higher healthcare costs, an aging population, trouble Social Security and Medicare systems, and the ever increasing foreign competition. The stock market hasn’t caught up yet because high corporate profits from 2005 will help many get by for the first half of 2006, but after that, watch out. It will catch up later in 2006, and then the stock market will adjust for falling corporate profits.

I’m perplexed by some economists and the rose-colored-glasses groups in the rose-colored column that refuse to see the big-picture as anything but rosy. Thus, people should not come to the rose-colored column for a real, unbiased picture of what’s going on.

So, it’s best to ignore conclusions from the current “In-Party” column, and just look at the stats, data, history, and trends, and you can make and educated guess of where it’s all headed. What we are doing now will have consequences later, despite the invincible-syndrome fostered by those that believe otherwise.

From all the data, the next few years will see rising interest rates, inflation, and debt.
Real median wages will continue to fall.
Foreclosures and unemployment will continue to rise.
The gap between the wealthiest 1% of the population and the rest will widen for a few years.
By 2007, government borrowing and spending will slow, because they will have no choice.
That is when the fiscal irresponsibility of previous years will become painfully clear.
And, if borrowing and spending continue as now, the next recession could quite easily turn into the next depression that lasts for many years.

Lastly, the PC (Political Class) people in government don’t care about any of this. They all have golden parachutes. It is the average voter that will suffer most from the irresponsibility of bought-and-paid-for incumbent politicians. The irresponsible incumbents will never reform themselves. Only the voters can do it now, or suffer the consequences of the voters neglect. It’s likely the voters will have to learn the hard way (again). But, someday, if they can ever learn, all they have to do is the one simple, common-sense, no-brainer thing voters were supposed to be doing all along: vote out (or recall) all irresponsible incumbents, always. Not once in a while. Every election. That’s what voting is for.

Laziness is at the root of the problem, but laziness works differently for corrupt politicians and voters.

Corrupt politicians have power by virtue of their office, and their laziness works for them, because they can simply create more opportunites for self-gain by simply mucking thing up.

But, voters laziness works against them, because their lack of motivation to observe and monitor politicians, and go vote them out takes time and effort.

So, the corrupt incumbent politicians have an advantage.

But, now, since many (if not all) incumbent politicians are irresponsible and corrupt, the most simple, common-sense thing for voters to do is to simply start voting out all irresponsible incumbents, and demand some simple, badly-needed, common-sense reforms, so voters can see exactly who is, or is not irresponsible.

Posted by: d.a.n at March 12, 2006 12:06 PM
Comment #132977

D.a.n.,
What concerns me is the way we enter the next recession. If the Bushg administration has demonstrated anything to us over these past five years, it is that they cannot lead. They do not do contingency planning. Apparently, preparing for the unexpected is tanatamount to a lack of faith, or worse, when it comes to this White House.

As a result, the Bush administration is absolutely gobsmacked when something unexpected happens.

Hopefully we’ll enter this next recession slowly and incrementally, giving the Bush White House plenty of time to adjust. If a dropping real estate market drives the upcoming recession, it might happen slowly enough for Bush to react. Unfortunately, the upcoming recession could happen very, very fast. We could go from the current situation to freefall in a week or less, especially if the drop is event driven; say, the US bombs Iran, so Iran cuts off Persian Gulf Oil, and so on.

There’s not much to do except enjoy the good times while they last. With luck, the good times could last through the summer.

Posted by: phx8 at March 12, 2006 3:29 PM
Comment #132996

phx8,

I think concern is justified.
The scheduled deficits for many years to come does not look good at all.
Not when the National Debt to GDP has never been higher since WWII.
Not when real median income has been falling for 6 years.
Not when 381,000 jobs have been lost since 1999.
Not when foreign competition is stronger than ever.
Not when the gap between the 1% of the wealthiest and the rest has never been larger since the Great Depression.
Not when foreclosures have been increasing for over a year during what some call a “very good” economy.
Not when a generational storm is looming.
Not when we are falling behind in education.
Not (especially) when government is FOR SALE and corrupt.
Not to mention interest rates, inflation, and unemployment are most likely going to continue to grow worse over the next few years.

It will be a long, long, time before anyone ever equates fiscal responsibility with Republicans (even though both Democrats and Republicans did it).

So, many people a fooled when some one quotes a few cherry-picked statistics to conclude that things are “very good”, based on historical norms. It is a clever, and old tactic. People need to look deeper to see the big picture.

However, you bring up a good point.

My estimates above are based on slowing of spending, borrowing, and printing money.

But, if it remains out of control, things will be much worse. And what we are already doing now is going to make the next recession more painful and difficult to recover from, or possibly turn it into the next Great Depression.

There is certainly no reason to be celebrating or trying to paint a rosy picture (especially for partisan motivated reasons).

The dangerous thing about the situation is that most people do not understand that it takes many years and decades for the consequences of decisions to be felt, and several decades of fiscal irresponsibility have already occured.
That is why extreme fiscal irresponsibility is dangerous.

It will eventually catch up with us.
There will be consequences.
There are dozens of factors , but the biggest five factors will be the following:
_______________
[1] FISCAL and MORAL BANKRUPTCY: $8.3 National Debt and $40.2 total nation-wide debt, decreasing options, lost opportunities, falling dollar (not backed up by real value), potential inflation, trade deficits, and the failure stop the debt from growing ever larger. Also, the PBGC and pensions are $1.6 trillion in the hole.
[2] GENERATIONAL STORM: 77 million aging baby boomers (that all vote), making less, spending less, pay less tax, expecting to draw from already troubled Social Security, Medicare, Medicaid, & welfare.
[3] ENTITLEMENT SHORTFALLS: The looming Social Security, Medicare, Medicaid, & welfare deficits and short falls, and decreasing number of tax-payers per entitlement recipient.
[4] LIMITED GROWTH & INCREASING FOREIGN COMPETITION: The limited capacity for growth due to declining quality of education, a generally less educated population failing to develop new technologies, coupled with a steady increase of foreign competition.
[5] ENERGY VULNERABILITY: Of all the responsible, insightful things government could have done, bought-and-paid-for incumbent politicians failed miserably to research and foster alternate energy sources, more energy efficient homes, automobiles, etc.
_______________

We may already be seeing signs of things to come.

Except for a few cherry picked stats and data, it is not a pretty picture. Not rosy at all. Certainly not “very good” .

Posted by: d.a.n at March 12, 2006 7:29 PM
Comment #133001

D.a.n.,
I don’t worry too much about long term projected problems if they can be addressed and solved in short periods of time. For example, demographics represents a horrendous long term problem for the economy. However, it can be addressed in a short or medium term period through immigration. Open the doors. Problem solved. Right now, that idea will not go over well, because we’re caught up in xenophobia, but given time, the solution should become obvious.

On the other hand, a problem like Global Warming could be considerably more difficult to fix.

The big long term problems are with non-discretionary spending and potentially with interest paid. I’m confident these problems can be fixed. I’m equally sure Bush is not the person capable of fixing them. Repairing Social Security Insurance by doing away with it is not an acceptable solution.

One other item… even if the upcoming recession occurs slowly & incrementally, I don’t think Bush will be capable of dealing with it. He’s too inflexible. “Stay the course.” The Bush economic program ended with tax cuts. There is no vision, none at all.

Meanwhile, the relationship between Bush & Congress pretty much guarantee nothing will happen. Bush doesn’t veto the Republican Congress. Congress doesn’t investigate Bush. That’s about the extent of their relationship. It’s odd, really odd. Why does the Republican Congress & Bush work together so little?

But in any event, whether the economy sinks like a stone in the upcoming recession, or submerges slowly, Bush will either be too stunned to react quickly, or too inflexible to recognize a drowning because he does not want to see one. That’s what happens with crappy leadership.

Posted by: phx8 at March 12, 2006 8:06 PM
Comment #133005

Good point.
Global warming could have a much larger impact than many think. I’m not sure what I think about that yet, but there is evidence of warming, and it’s nearly impossible to claim we are not making it worse. Someone recently on this blog (you perhaps) said global warming was going to be one of the biggest problems (and disasters) in the coming decade.
I know enough about it to know that a few degrees can have devastating consequences.
And, the U.S. is responsible for a large part of the global warming.
You may be right. I’ll need to study that further.

Yeah, Bush is not an idea man. I’m really sorry I voted for him in 2004. Even though I don’t like Kerry, I’m beginning to think we would have been better off with him, than Bush. But, in the future, I’m voting non-incumbent, since I think most (if not all) incumbent politicians are irresponsible.

Posted by: d.a.n at March 12, 2006 8:25 PM
Comment #133022

D.a.n.,
I don’t think I said it, but I would stand by a prediction that Global Warming would have a major impact within 10 years. No one can say for sure, of course, but it seem plausible. What’s really scary is that in the past few years, research shows climate change occurs fast. It can be drastic in a matter of years.

I was a little suprised that I offered a bet, that the coming hurricane season would break the record setting previous season, and no one would take me up on it.

Well, d.a.n., I thought Bush 41 was on balance a pretty good president, and although I voted for Gore, I thought Bush might be all right. I thought he would be a moderate Republican, without much in the way of ideological bias. Boy, was I wrong. He’s been a freaking disaster. But at least he’s discredited the Holy Rollers, Neocons, and conservatives so thoroughly, hopefully we won’t be hearing from them after 2008… hah… I wish… deluded people avoid waking up at almost any cost.

Posted by: phx8 at March 12, 2006 9:50 PM
Comment #133038

phx8:


Globalization is killing us.

I wouldn’t go that far!! Here are a few positives:

Cheaper labor causes Low inflation, which causes lower interest rates, which causes higher real estate prices, which causes increases in consumer spending.

It is very hard to tell consumers that cheaper prices are “killing us”.

I disagree with those words.

What I do agree with is that there are winners and loosers. The loosers are those who loose there jobs and do not have transferable skills. Also those with jobs facing foreign competition so their wages/benefits stay stagnant at best.

I do think stagnant median incomes is a critical issue for debate.

Stephen:

I didn’t like your response because it seemed to be yet another slam to the right. It was Clinton who signed Nafta. In the end I would like to know the Democratic plan for addressing this issue.

Stagnant income in the working class seems like a very tough nut to crack in a world of a labor glut and investment glut. We seem to be living in a sea of available labor and capital. It looks like a period (maybe a long period) of very flat inflation numbers, maybe even mild disinflation.

Not only are these developing contries providing cheap labor, but my god, many save 20% of their incomes. They crave our liquid investment markets, driving down are interest rates, and driving up our home prices. I don’t see the trend changing for a long long time.

In the mean time, what is to be done for the working class to give them the fruit of our country? I think it might be an issue for the Dems to lead on.

Craig

Posted by: Craig Holmes at March 12, 2006 11:39 PM
Comment #133040

Reed:

There aren’t any simple, single answers, and we shouldn’t be afraid of the complexity of the problems. It has to be a combination of things: better skills, yes, but also smarter government policies, a more thoughtful and active citizenry, and morally decent and intelligent leadership.

We could take a corner of the universe and start there. How about Walmart? What bothers me about Walmart is that the wealthy owners are in effect taking government subsidies to run their business by providing working class employees substandard health insurance which requires this workers to go on government assistance.

If we were to require Walmart to meet a higher minimum coverage for medical insurance, then their prices would go up some, but also state taxes would go down, (by the amount of medical insurance that states have to pay). It would be a sort of back handed sales tax.

As I think out loud on this, Unions were so useful in years gone by in promoting health coverage from corporations. I wonder if it is time for the union movement to be revitalized.

Craig

Posted by: Craig Holmes at March 12, 2006 11:49 PM
Comment #133099

ElliottBay
“Which goes a long way to explain why the the Bush administration raised the terrorist threat level ten times during the campaign but not once since then, right?”

Yep. But thats just the opinion of this conspiracy nut.

Posted by: kctim at March 13, 2006 2:38 PM
Comment #133122
If we were to require Walmart to meet a higher minimum coverage for medical insurance, then their prices would go up some, but also state taxes would go down, (by the amount of medical insurance that states have to pay). It would be a sort of back handed sales tax.

Craig,

To be honest, I don’t know whether this is a good idea or not. The devil’s really in the details. But I am convinced that, over the long haul, the current health insurance system is a major albatross around the neck of U.S. businesses. I believe the government could administer a system much more efficiently, taking the burden off businesses and letting them focus on doing the things they do best. It’s another case (and there are many) when doing the right thing and doing the smart thing are one and the same.

Posted by: Reed Sanders at March 13, 2006 4:41 PM
Comment #133247

We have to get middle-men (government and insurance companies) out of the the health-care system.

But, no reforms of any kind are possible until voters, first, do what they were supposed to be doing all along.

Posted by: d.a.n at March 13, 2006 11:56 PM
Comment #133392

dan my health care in 1986 was $97 a month. today almost eight times as much.

Posted by: RODNEY BROWN at March 14, 2006 5:20 PM
Comment #133469

That’s because there is an entire industry of unnecessary people (millions) that add no net benefit to the system.

Posted by: d.a.n at March 15, 2006 12:02 AM
Comment #133471

But, othere than that, everything is “very good” .

Posted by: d.a.n at March 15, 2006 12:03 AM
Comment #133472

d.a.n. what do you think of harry browne?

Posted by: RODNEY BROWN at March 15, 2006 12:08 AM
Comment #133474

d.a.n or did think of him?

Posted by: RODNEY BROWN at March 15, 2006 12:27 AM
Comment #133797

Harry Browne, supporter of the Libertarian Party and the DownsizeDC Foundation?

I don’t know much about him, but I think he recently passed away.
What did you think of him?
I’ll have to research it.

Posted by: d.a.n at March 16, 2006 12:40 AM
Comment #134770

phx8. sorry late post. some more info from your source wikipedia. about clinton for info about controversy click here. ok i clicked it .the study describes how job changing can inflate numbers. when job turnover was brisk as in the late 1990s about 4 million jobs were counted twice. also further down in wikipedia was . note the collapse of the dot com bubble and the resulting recession began in the closing months of clintons presidency.

Posted by: RODNEY BROWN at March 20, 2006 3:02 PM
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