Boring Unemployment News January 8, 2010
Posted by geoff in News.trackback
And this month’s unemployment rate is . . . 10.0%! Same as last month. Here’s the chart:
As has been the case for the past 6 months of unemployment rates, the rate is being suppressed by the number of people who have completely left the job market. In this case, the actual number of jobs is a better measure of how we’re doing:
A cumulative job loss of over 8 million, with not much sign of slowing. Sigh.
[Don’t forget, you can now get the unemployment chart on t-shirts, mugs, and postcards!]
Previous posts in this series:
- The November numbers
- The October numbers
- Initial uemployment claims through the end of November
- Initial unemployment claims through the end of October
- A “million jobs saved?” A drop in the bucket.
- Comparing the administration’s statements to reality
- The September numbers
- The August numbers
- The “million jobs saved” claim
- Initial unemployment filings
- The July numbers.
- The percentage of private-employed workers is steadily decreasing, meaning that the burden of supporting government workers is increasing. How long can this trend continue?
- The June numbers.
- Mark Zandi (Moody’s Economy.com) kind of agreed with the Obama team’s projection back in January. But his predictions weren’t much better.
- Saying that “the recession is worse than anybody thought” is a tired old tune
- Everybody did not “guess wrong” on the stimulus package
- The corrected chart for May.
- The predicted numbers for May from a few days ago, with some thoughts on why unemployment is worse than expected even without the stimulus package (and a hearty discussion in the comments on proper graphing)
- A look at the stimulus package spending – how late it is, and how little thus far has been devoted to job creation (it’s basically gone to pay off states’ social services debts)
- The April numbers
- The original post on the subject, noting that criticisms of the stimulus package may not have been motivated by racism after all.
Comments
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Innocent Bystanders 
GEOFF IS TALKING IN HTML!
SOMEBODY HELP HIM!
C’mon Geoff!
*chest compression*
*chest compression*
*chest compression*
*chest compression*
*chest compression*
BREATHE DAMMIT!
http://tinyurl.com/yd2kpw9
*Peeks out to see if post is fixed*
Ah! No problems here!!
I’m sure we’ll hear about Teh One has managed to “stabilize” the situation.
It’s sad, because I know how many people are unemployed around me. Employees family members. They have given up. They aren’t looking for jobs, really, because they figure the only way to get a job is to know someone – personally – who is hiring.
For those unemployed, it’s time to put all that extra time into making the luxury items you used to go out and buy – like instant coffee:
http://bit.ly/ozqT6
(satire)
CHART!
Thanks, Geoff.
Once again — as you do every month — your top graph is based on a report written by an economic advisor BEFORE OBAMA EVEN TOOK OFFICE, and which doesn’t reflect the ACTUAL STIMULUS PACKAGE PASSED. And the report itself goes to great pains to say that unemployment (without the stimulus package) could go as high as 11% by some estimates.
You know this; your more astute readers can verify this. So I have to ask (again) — what exactly is your point?
So I have to ask (again) — what exactly is your point?
I think geoff’s making the same point that Time magazine is making here:
http://www.time.com/time/business/article/0,8599,1910208,00.html
(keep in mind, this article was written in July, whent the jobless rate was only 9.5%. It’s increased since then.)
We were told that they HAD to pass the stimulus, in order to keep the unemployemnt rate below 8%. And so they did. And it did nothing, except put our country into a dept so deep that we may never recover.
So, short answer, K, we were lied to so Team Obama could spend almost a trillion dollars on their pet projects.
Does that help?
Obama lied, the economy died.
I (and others) have answered these points before, so once again, as some yahoo does every month, you bring up discredited canards. So I have to ask (again) – do you ever listen to the rebuttals? Ever?
Here’s a brief rundown for you, just in case you’re in the mood to listen and retain them this time:
1. Obama took office 2 1/2 weeks after the report, and the stimulus package was passed a month later. This report was the Obama administration’s case for the stimulus, and it stood, unrevised, as the administration’s case for months after the ARRA passed. In fact, I pulled it off of the White House web site. And this document served as the source of all the Dem’s claims of “4 million jobs created or saved.”
2. The predictions by Romer et al. were so crude that the form of the stimulus didn’t really matter. And the amount they assumed, “just slightly over the $775 billion” was almost exactly what was passed.
3. The report has the typical caveats, but nowhere does it say that unemployment could go to 11%.
So what is the point? Once again:
1. The original predictions were ridiculously naive in terms of terms of the speed of injection of money into the economy. It was exemplary of the administration’s lack of experience at the federal level.
2. The basis for the predictions was a crude back-of-the-envelope analysis which should have been scrutinized by Congress and the press. But they gave it a pass. Romer’s team, the Dems in Congress, and the press should all be mortally embarrassed. Look at the post following this one for a decent prediction, made before Romer’s POS.
3. The predictions are not just quantitatively incorrect – they are qualitatively incorrect. They are not even close to what was expected by the administration. No corrective action has been taken, so we’re stuck with enormous, irrational spending and no results. This chart is a monthly reminder that rather than health reform, global warming, etc., Congress should be focused on fixing their errors.
4. Following the line of (3), Congress is now considering compounding their errors with another, likely wasteful and ineffectual, stimulus package.
5. This chart has largely served its original purposes, but it now also serves as a monthly reference point for unemployment – people can tell at a glance how we’re doing from one month to the next.
So, K – any more questions?
Wiserbud:
Thanks but I’m not sold.
It goes without saying that economics is not an exact science. Back when the report was written, there was no consensus as to how high the unemployment rate would be. The authors of the report acknowledge that unemployment without the stimulus could be as high as 11%. They say so in a footnote right next the graph that Geoff is using, although Geoff omits this.
So claiming that Obama “lied” is simply hyperbolic rhetoric, because:
(1) The unemployment rates in the report were ADMITTEDLY estimates
(2) The report was written before the full extent of the economic problem was ascertained (which the report also acknowledges)
A month before the Time article was written, Obama acknowledged that even with the stimulus, unemployment would go to double digits:
http://www.bloomberg.com/apps/news?pid=20601087&sid=auTTvgeN294Y
… so I’m not sure Geoff’s graph is a “gotcha”.
As for Obama’s “pet projects” — well, that’s just silly. They’re repaving an off ramp near where I live in central North Carolina with stimulus money. The state of North Carolina picked that project. In fact, most states — and NOT the Obama administration — picked where the most of the stimulus money was spent.
“Government’s view of the economy could be summed up in a few short phrases: If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it. ”
Ronald Reagan
We are in for a hell of a scary ride.
A month before the Time article was written, Obama acknowledged that even with the stimulus, unemployment would go to double digits:
Yep, the April and May numbers were so bad that Obama finally had to acknowledge that the stimulus wasn’t working. Early June was a major turnaround in their rhetoric. This chart, first published here in April, preceded that turnaround by more than 2 months.
It was most definitely a “gotcha.”
3. The report has the typical caveats, but nowhere does it say that unemployment could go to 11%.
I should amend that – in the footnotes at the end of the report, they do note that some private forecasters say that unemployment could go to 11%. Without the stimulus, as you noted. So what? I noted the same thing in the post following this one.
The message has always been that the stimulus was poorly conceived and ineffective. That’s been demonstrated. The fact that Romer’s predictions are so unrealistic is an unfortunate side story that illustrates how poorly staffed the Obama administration is. Another way in which he followed Bush’s lead.
Geoff:
Addressing your paragraphs:
1. The fact that the Obama Administration stood by the report in the beginning days of its administration means nothing. It was the best information it had at the time. It made the case for the stimulus package — an argument that was still valid even if the predictions for future unemployment were unknowable to a 100% degree of accuracy.
2. They were “crude” because economic, as I have said, is not an exact science. And the report makes this explicit at, among other places, page 3
3. The report indeed does say that unemployment could go as high as 11%. See:
Click to access 45593e8ecbd339d074_l3m6bt1te.pdf
Your graph is on page 5; endnotes begin on page 14
I also disagree with your assessment that the Obama predictions were qualitiatively incorrect. Even by your modified graph, it certainly indicates that the stimulus slowed down the rate of unemployment. We seem to be approaching the peak of the curve, and it comes at about the same time the Obama advisors predicted it would
As for Obama’s “pet projects” — well, that’s just silly. They’re repaving an off ramp near where I live in central North Carolina with stimulus money. The state of North Carolina picked that project. In fact, most states — and NOT the Obama administration — picked where the most of the stimulus money was spent.
Here in Michigan all the money went to fill in holes in the state. Stimulating … NOTHING.
And the report itself goes to great pains to say that unemployment (without the stimulus package) could go as high as 11% by some estimates.
And even with the stimulus package, it’s pretty damn close to that now, if not higher, depending on how you do the calculations.
So what was the point of spending this country into such a massive hole, K? What purpose did the so-called stimulus package serve, other than to pay off the right supporters?
“Here in Michigan all the money went to fill in holes in the state. Stimulating … NOTHING.”
Those holes get filled in by themselves?
Anyway, I think the money went to other things in Michigan. Let’s try to keep to the facts:
http://www.detnews.com/article/20100108/AUTO01/1080346/1148/GM-battery-may-get-Michigan-moving-in-new-direction/GM-battery-may-get-Michigan-moving-in-new-direction
“So what was the point of spending this country into such a massive hole, K?”
To avoid a massive 1920’s-type depression which, in the long run, would have been WORSE than creating huge deficits.
As for Obama’s “pet projects” — well, that’s just silly.
Yes, K, these are Obama’s “pet projects” because they pay off exactly the right people, the SEIU.
Is spending $65million on a museum that will supposedly create 65 more government jobs really considered a stimulus to the economy as a whole? Government employees are not producers. And more jobs for government employees is not a stimulus to the economy in any way, shape or form.
To avoid a massive 1920’s-type depression which, in the long run, would have been WORSE than creating huge deficits.
So, in other words, placing a debt so monstrous that it will likely never be eliminated and bankrupting the country for the rest of time is better than a few years of a down economy
Who’s being silly now, K?
[…] you see that the actual number of jobs in the country sank by 85,000 in December. The unemployment rate remained unchanged because the number of people who gave up looking for work also rose. As has been the case for the past 6 months of unemployment rates, the rate is being suppressed by […]
Geoff,
Anyway of adding the U-6 numbers to the chart? That would give a better understanding to some about the job losses.
Thanks,
Is spending $65million on a museum that will supposedly create 65 more government jobs really considered a stimulus to the economy as a whole? Government employees are not producers. And more jobs for government employees is not a stimulus to the economy in any way, shape or form.
Yeah, wiserbud. From the Coke vendor who stocks the machines in the museum’s restaurant, to the gas station that supplies the gas to the family driving to the museum, there is a ripple effect that creates (or preserves) jobs.
Not to mention the government employees who have salaries to spend, which preserve OTHER people’s jobs.
So, in other words, placing a debt so monstrous that it will likely never be eliminated and bankrupting the country for the rest of time is better than a few years of a down economy…
I don’t grant the premise.
Look, nobody is happy about the debt. But in my lifetime, I’ve heard that song before — creating a debt that will never be eliminated — and yet somehow, we managed to eliminate and create a surplus.
I think creating a huge national debt is horrendous, but preferable to a nation where a sizable majority of good honest working people lose everything they have worked for their entire lives. Not to mention the major collapse of our industrial base. Because that was what we were facing — not some mere “downturn”.
1. The fact that the Obama Administration stood by the report in the beginning days of its administration means nothing.
Au contraire – it means that your claim that it wasn’t relevant because it was published early is completely invalid. And of course it was “the best information at the time.” Few people try to make predictions using anything but “the best information at the time.” The point is, their prediction sucked.
2. They were “crude” because economic, as I have said, is not an exact science. And the report makes this explicit at, among other places, page 3
Absolutely false. Their methodology was crude because they didn’t use an actual model of the economy, like, say, Mark Zandi did. He ran a simulation of the economy w/o the stimulus and did quite well in predicting unemployment in 2009. Romer et al. did a back-of-the-envelope calc. And got away with it. Economics is not an exact science, but that doesn’t excuse spending nearly a trillion dollars based on a 1-page Excel spreadsheet.
Even by your modified graph, it certainly indicates that the stimulus slowed down the rate of unemployment.
Hahahaha! Are you looking at the same curve I am? The peak w/stimulus comes in Q309. At that point the unemployment is still rising. The rate of unemployment (which has been held artificially low by the exodus from the work force) is following the w/o stimulus shape, which is qualitatively different than the w/stimulus curve.
If you look at the second chart, you can see exactly how effective the stimulus has been at creating/saving jobs. I have stated on many occasions that pumping money into the economy via the stimulus package was a wasteful means of promoting job creation, but that it had to have some beneficial effect.
I’ve been stunned at how little effect there has been.
I’ve heard that song before — creating a debt that will never be eliminated — and yet somehow, we managed to eliminate and create a surplus.
Surely you understand the difference between a “deficit” and a “debt?” We have had years with no deficit, but we have always had a debt.
I’m not sure why you guys continue to answer K. She’s obviously a troll, given that she said:
“Even by your modified graph, it certainly indicates that the stimulus slowed down the rate of unemployment.”
When the chart clearly shows the opposite, skyrocketing unemployment.
I think creating a huge national debt is horrendous, but preferable to a nation where a sizable majority of good honest working people lose everything they have worked for their entire lives. Not to mention the major collapse of our industrial base.
1) The huge national debt is indeed horrendous, and may, of its own, guarantee that good honest working people lose everything they have worked for their entire lives.
2) The industrial base is still collapsing (note the unemployment rate for manufacturing two posts after this one), despite the spending.
3) You seem to be under the misapprehension that we were opposed to government action to save the economy. Untrue. We just thought that the government actions that were actually taken would prove to be tardy, ineffective, and too costly.
I’m not sure why you guys continue to answer K. She’s obviously a troll, given that she said:
Passes the time.
Because that was what we were facing — not some mere “downturn”.
Yeah, damn that whole free market/capitalism thing and it’s penchant for rewarding success, while punishing failure. If only the government could control everything, then no one would ever suffer and nothing would ever fail ever again.
The point is their prediction sucked.
But it’s not like they didn’t tell us that their “predictions” were fraught with unknowables. If they had said (in effect), THESE NUMBERS ARE THE WAY IT IS GOING TO BE, FOLKS — then you might have a point.
Their methodology was crude because they didn’t use an actual model of the economy
The problem, as Roemer et all pointed out, was that what we were facing had no economic precedence in history. Nobody could say with 100% certainty that THIS model was right or THAT model was wrong. It’s all very easy in hindsight to point out where certain economists went wrong (and every single one of them is wrong at some point or another), but again, if economics was an obvious exact science, there wouldn’t have been a bubble burst in the first place.
Anyway, the economists were writing a paper on the effects of the stimulus. In doing so, they had to make certain assumptions including not only the future unemployment rate, but also when the stimulus would be passed, how soon the stimulus money could be spent, etc.
Were they off in some of these assumptions? Sure. Because they didn’t have a crystal ball, particularly about the political process in getting the stimulus passed and the money spent.
But that is not a condemnation of the IDEA of the stimulus itself. Nor does it negate their overall thesis that the stimulus creates or saves jobs and reduced unemployment compared to a no-stimulus situation.
I’ve been stunned at how little effect there has been.
Compared to what?
Even by your second chart, if you cover your hand over everything past March 2009, and imagine the trendline that was to follow, the prospects look far worse than reality.
Also, keep in mind, we still haven’t actually spend most of the stimulus money yet.
Surely you understand the difference between a “deficit” and a “debt?” We have had years with no deficit, but we have always had a debt.
I do. I initially used the word “deficit” — wiserbud responded with “debt”. Rather than quibble over semantics, I just adopted his phraseology.
Yeah, damn that whole free market/capitalism thing and it’s penchant for rewarding success, while punishing failure.
I don’t think the working man on the unemployment line “failed”, yet he is the one being punished. And to the extent that the government needs to step in and protect him (and by extension, the economy), I much prefer that it spend money to create a job for that man, rather than give welfare handouts, don’t you?
Ashford: It was “The Bush Economy” to yourself and many other weasels, as soon as a month after the man entered the Oval Office for the first time. It’s the Obama Economy now; and the Democrat Economy since 2006.
Responsibility is a bitch, isn’t it?
Yeah, wiserbud. From the Coke vendor who stocks the machines in the museum’s restaurant, to the gas station that supplies the gas to the family driving to the museum, there is a ripple effect that creates (or preserves) jobs.
Not to mention the government employees who have salaries to spend, which preserve OTHER people’s jobs.
_____________
Wrong. Seriously, that’s weapons grade stupid.
Have you never heard of the broken window fallacy? The money you spend on the museum has to be taken from someone else. So instead of a private citizen spending their money and creating jobs, the government steals it, uses half of it in admin costs, and spends the other half on some politically connected pet project. That is wasteful.
wiserbud responded with “debt”. Rather than quibble over semantics, I just adopted his phraseology.
My bad.
And to the extent that the government needs to step in and protect him (and by extension, the economy),
Everytime the government “steps in” they screw things up worse. That’s kind of the whole point here.
The governement was, to a very large extent, responsible for this current situation, so to turn to the government for the solution is insanity.
I much prefer that it spend money to create a job for that man, rather than give welfare handouts, don’t you?
And, as geoff’s charts continue to show, that’s not really working out all that well either, is it? They spent almost a trillion dollars, and want to spend more, and they are STILL having to give welfare handouts to more and more people. Or didn’t you notice the “an additional 85,000 people lost their jobs last month” part.
Just because the President and the lapdog media are telling you the real story doesn’t mean things are as peachy asyou want to make them out to be, K. Or is nearly 18% underemployment okay with you, as long as the government is pulling the strings and giving everyone theior free health care?
Correction: Just because the President and the lapdog media are NOT telling you the real story …..
DaveP:
Captain Smith came on to the bridge after the Titanic hit the iceberg, but that didn’t make him “responsible” for the hitting the iceberg in the first place, or the lack of lifeboats, etc.
Like the Titanic, the bad situation that we are in is the product of many people, policies, and decisions — and no, not ALL from Bush/Republicans. Anyone who thinks otherwise isn’t being honest and isn’t worth debating.
In response to spending $65 million on a museum to create 65 jobs, K Ashford says:
“From the Coke vendor who stocks the machines in the museum’s restaurant, to the gas station that supplies the gas to the family driving to the museum, there is a ripple effect that creates (or preserves) jobs.”
Sure, but at what cost? At the cost of taking all that money away from private industry, which has a proven record of being many times more accomplished at creating jobs.
If you’re not considering the costs, you’re simply not being honest.
You also need to consider the cost of the debt, the cost of the waste, corruption and fraud built into the process, and the cost of such spending destabilizing the supply of capital to up and coming companies that have things to do.
If you consider those costs, you can predict the effects of the Stimulus Package and come pretty close to what actually happened.
(Proving that Economics can be a pretty exact science if you don’t abuse it for political gain.)
Nobody could say with 100% certainty that THIS model was right or THAT model was wrong.
Of course not. But many, many people, including the group of economists who took out a full page ad in the New York Times, pointed out that the stimulus spending was poorly constructed and would not yield significant benefits. So here we have an analytically weak prediction that served as the foundation for the administration’s policy and the Dem’s inflated promises.
Because they didn’t have a crystal ball, particularly about the political process in getting the stimulus passed and the money spent.
That’s ridiculous. Government spending timelines are well known to anybody who has ever dealt with the federal procurement process. My shock at the naivety of their timelines prompted my first post on the subject back in February. It’s not a question of accuracy in prediction – they were completely uninformed. It’s like saying you can cook a turkey in an oven in 15 minutes because you’re familiar with a microwave.
Compared to what?
Compared to, say, a typical economic recovery.
Even by your second chart, if you cover your hand over everything past March 2009, and imagine the trendline that was to follow, the prospects look far worse than reality.
If I “cover my hand?” You mean “if I remove the inconvenient data?” Just for chuckles I plotted linear trendlines for the Jan08-Mar09 range and the data from Mar09 on. The slopes are -370K/mo and -371K/mo, respectively.
Also, keep in mind, we still haven’t actually spend most of the stimulus money yet.
That’s one of the big faults of the stimulus.
And so begins the “tick .. tick .. tick” to January’s numbers when the Labor Dept adjusts the “birth/death” model by using hard numbers to set the “death” level, which wipes out the estimated (fudged) job “birth” numbers for small business employment.
Hey Geoff,
It looks like these handsome Unemployment Chart Cafe Press products are doing more to employ people than the Obama Stimulus Package.
Oh, the irony!
“Sure, but at what cost? At the cost of taking all that money away from private industry, which has a proven record of being many times more accomplished at creating jobs.
If you’re not considering the costs, you’re simply not being honest”
Yes, but private industry hasn’t been in a position to create jobs on its own for a number of reasons (banks were not lending money, existing businesses weren’t expanding, new businesses couldn’t get capital, etc.)
And this stimulus spending — it GOES to private industry. Private businesses are the ones who get the government contracts to fill in the potholes, build the museums, etc.
I DO, by the way, consider the costs. But if you think there were a significant amount of “up and coming companies” that had things to do, so many in fact that it could have lifted us out of recession, then you simply didn’t have a good read on the crisis in the first place.
Anyway of adding the U-6 numbers to the chart? That would give a better understanding to some about the job losses.
I have to say “no” for two reasons:
1) the chart is based on the original chart from Team Obama, which is based on U-3.
2) the U-6 numbers are still not completely describing the unemployment situation. U-6 does not include people who are dropping out of the workforce altogether. The workforce should be adding 130K people/month, but we’re losing hundreds of thousands a month.
That’s why I included the 2nd plot, which show the number of employed people remaining. It gives a more accurate sense of what’s going on with employment.
I can, of course, plot the U-6 numbers just for fun. I think other people have done that already, but I could do it here.
I do. I initially used the word “deficit” — wiserbud responded with “debt”. Rather than quibble over semantics, I just adopted his phraseology.
Not true. Wiserbud responded with “debt” quite correctly – he said that stimulus spending would saddle us with an enormous debt. Your response was that since we had occasionally had a budget without a deficit, debt was no problem.
That’s a completely irrelevant answer to his point.
It looks like these handsome Unemployment Chart Cafe Press products are doing more to employ people than the Obama Stimulus Package.
It goes to stimulate the UK pub industry, via S. Weasel’s fair gullet. Like Cash for Clunkers, it does more good for foreign economies than for our own.
Captain Smith came on to the bridge after the Titanic hit the iceberg, but that didn’t make him “responsible” for the hitting the iceberg in the first place, or the lack of lifeboats, etc.
True, it only makes him responsible for his actions afterwards (let’s all just forget that our current “Captain” was a part of the team that designed and orchestrated many of the causes of the current situation entirely, shall we? )
So, if Captain Smith decides that the best way to fix the Titanic is to stear it into a even larger iceberg, to maybe bend the metal back into lace, you’re okay with that?
Not true. Wiserbud responded with “debt” quite correctly
Hmm, I guess I should have taken the time to double-check what I wrote before simply taking K’s word for it.
I hereby rescind my “My bad.”
The goal of “stimulus” spending is to achieve an economic multiplier for every dollar spent, and to do it in a timely manner. A billion dollars spent properly should create a much larger effect in the economy.
This stimulus has been more of a “hold the line” strategy, trying to preserve jobs and services without doing anything that will actually stimulate the economy. Some of the money had to be spent that way (i.e., unemployment insurance), but most of the money that is supposed be stimulating the economy is just supporting a small number of workers for a fixed period of time.
I’ll say it again: the ARRA stimulus was too slow, and the strategy was misguided.
[…] UPDATE: More on unemployment here. […]
[…] Inn0cent Bystanders is known for producing the amended Romer charts on unemployment rates each month, but this chart is […]
“The problem, as Roemer et all pointed out, was that what we were facing had no economic precedence in history.”
Whiskey Tango Foxtrot?! This bubble collapse had many characteristics in common with the beginning of the Great Depression, and in a sad irony, the bubble was largely facilitated by some of the “solutions” created by the New Deal itself. And, in a display of complete ignorance of history, the government is doing precisely many of the same things in response this time. And they’re failing now just as FDR did then.
This has more links than BBF.
“That’s ridiculous. Government spending timelines are well known to anybody who has ever dealt with the federal procurement process.”
Nobody had dealt with a federal procurement of this size and scale before. As many of your commenters point out, this was unprecedented.
So for that and other reasons, of COURSE, Obama’s economic advisors were “uninformed” when they created their graph. That’s my point.
Even if they were close on the total amount of stimulus spending, they didn’t know the breakdown of where the money would be allocated. And that makes a difference in both the effect and timing of the recovery. For example, stimulus spending which goes to business incentives or food stamps can be flushed into the economy relatively quickly; stimulus spending going toward construction takes longer for its effects to be seen (because you have to find where the shovel-ready projects are).
Did Roemer et al know HOW the stimulus money was to be spent? No, of course not. Nobody did at that time.
So again, this “gotcha” seems a little silly.
You know, PJ, when Geoff’s chart brings in the traffic, it’s always funny to scroll down and see what’s below it for visitors curious about our site.
BWAAAAAAAAAHAHAHAHA!!!
[…] ‘Stimulated’ economy continues to shed more jobs […]
“you see that the actual number of jobs in the country sank by 85,000 in December. ”
The actual number of jobs in the country sank by 589,000 in December. The number employed dropped from 138,381,00 to 137,792,000. As people have lost jobs, they have dropped out of the labor force. The labor force participation rate has dropped from 66.5% in December 2008 to 64.6% in December 2009. As people lost jobs, many left the labor force. If they had stayed in, being counted as unemployed, the unemployment rate would be 11.6%.
If there had been no stimulus package passed, and we had had the same series in the labor market, the Keynesians would be screaming about how awful it was that we did not use fiscal policy. However, they object to people arguing that the awful series shows that fiscal policy was a bust. Is faith in fiscal policy scientific or religious? Is it possible to falsify? If so, how?
(There is an asymmetry here that favors government action. What the graph at the top is doing is trying to address that asymmetry.)
One other thing that is notable. When fiscal policy was first touted by Hansen, Samuelson and others, the fact that the multiplier was supposed to be high was one of its main selling points. If they had said that the multiplier was less than 2, as Romer has estimated, fiscal policy and the Keynesian model would never have been taken seriously. Now the low multiplier seems actually to be a virtue–it justifies massive increases in government spending by those who want massive increases in government spending for other reasons.
Nobody had dealt with a federal procurement of this size and scale before.
Wrong. Wrong. Wrong. In toto, perhaps, but spending a couple hundred billion in a year is nothing special. It just takes a while.
So for that and other reasons, of COURSE, Obama’s economic advisors were “uninformed” when they created their graph.
Look, the stimulus could have been tiny and it still wouldn’t have met their timelines. The fact is, most of the “spent” money is counted as spent when it is sent to the states. The states count it as “spent” when it is obligated to a contract. It is only really spent when invoices from those contracts are paid. That process takes six months even when expedited. This is why the states had only received $37 billion by the end of October.
The difference between you and me is that I have worked in and/or with the federal procurement process for 25 years. There was never any way that that stimulus plan would have an impact in the timeframe they used. And there is nobody familiar with federal procurement who would tell you otherwise.
Did Roemer et al know HOW the stimulus money was to be spent? No, of course not. Nobody did at that time.
Except for specific pork projects, yeah, she pretty much did. (It’s Christina Romer, BTW).
So again, this “gotcha” seems a little silly.
Silly? Only if you don’t care about all the unemployed people who are sitting around waiting for this to finally do them some good. Many, many people said that the stimulus spending would be too slow, and that the bulk of it would occur when the economy was naturally healing itself. So far those people have been correct, and the stimulus pitch hasn’t made a single accurate prediction.
Gotcha.
The goal of “stimulus” spending is to achieve an economic multiplier for every dollar spent, and to do it in a timely manner. A billion dollars spent properly should create a much larger effect in the economy.
No argument here.
This stimulus has been more of a “hold the line” strategy, trying to preserve jobs and services without doing anything that will actually stimulate the economy…
I’ll say it again: the ARRA stimulus was too slow, and the strategy was misguided.”
I don’t necessarily disagree here either, especially the “hold the line” part.
But I think the kind of spending that gives the best “bang for the buck” in terms of creating (rather than saving) jobs was/is the kind of spending that couldn’t have spent quickly. You have to have shovel-ready jobs lined up, and if they simply are not there (or you need time to find out where they are), then you simply can’t spend stimulus money as quickly as you or I might like.
Spending stimulus money slowly was not an Obama “strategy”; it was just unfortunate reality.
Spending stimulus money slowly was not an Obama “strategy”; it was just unfortunate reality.
Not at all – one method for pumping money into the economy quickly is to use the R&D side of the military-industrial complex (as Keynes finally admitted). By modding existing contracts and using well-established procurement pipelines, the money can be spent more quickly, and in a way that is inherently stabilizing to the economy.
Of course, that was never really an option for this administration.
Military spending?
icky!
But I think the kind of spending that gives the best “bang for the buck” in terms of creating (rather than saving) jobs was/is the kind of spending that couldn’t have spent quickly.
So you’re agreeing that it is obvious that they couldn’t have spent the money effectively in the timelines they predicted.
You have to have shovel-ready jobs lined up, and if they simply are not there (or you need time to find out where they are), then you simply can’t spend stimulus money as quickly as you or I might like.
And when we all pointed this out a year ago, we were assured that shovel-ready projects existed in droves. But the procurement process itself is going to lead to a 2-quarter delay, even if the projects are ready to go.
“Wrong. Wrong. Wrong. In toto, perhaps, but spending a couple hundred billion in a year is nothing special. It just takes a while.”
Yeah, Geoff, but spending a hundred billion a year on a handful of projects (say, military and weapons development) doesn’t require the involvement and input of officials and agencies from all 50 states, down to the county level. One hundred billion going into the hands of a handful of military contractors is nothing compared to seven hundred billion being funneled to thousands of contractors from all industries… to say nothing of trying to make it all transparent.
Now, if your SOLE point is that the Obama advisors should have KNOWN that the effects of the stimulus package weren’t going to kick in as quickly as Romer suggested, then I’ll concede that as a valid point. But also a relatively minor one — and one that Obama himself conceded months ago. I don’t know why it has to be pointed out again on a monthly basis here with graphical updates. The phrase “beating a dead horse” comes to mind.
But apparently most of your commenters, and certainly those who link here, are drawn to the graph because it supports their view that the Obama stimulus package has actually made things WORSE than if there had been no stimulus at all. And that’s simply untrue.
“But apparently most of your commenters, and certainly those who link here, are drawn to the graph because it supports their view that the Obama stimulus package has actually made things WORSE than if there had been no stimulus at all. And that’s simply untrue.”
Is there some empirical reasoning backing up the conclusion, or is it an assumption? If there is something backing it up, what is it?
spending a hundred billion a year on a handful of projects (say, military and weapons development) doesn’t require the involvement and input of officials and agencies from all 50 states, down to the county level. …
Yup.
I don’t know why it has to be pointed out again on a monthly basis here with graphical updates.
It’s more of a tradition than anything else at this point, though there are practical reasons as well (which I already pointed out in #10 above).
Now, if your SOLE point is that the Obama advisors should have KNOWN that the effects of the stimulus package weren’t going to kick in as quickly as Romer suggested
I have another point, which is that the construction projects, pork projects, and green spending are not very stimulating, even in the long term. I.e., the economic multiplier is likely to be around 1.
the Obama stimulus package has actually made things WORSE than if there had been no stimulus at all. And that’s simply untrue.
I think it made some things better, but that it also suppressed some aspects of recovery. Mixed bag.
it supports their view that the Obama stimulus package has actually made things WORSE than if there had been no stimulus at all. And that’s simply untrue.
Where the hell is that coming from? I don’t remember that ever being stated or even implied.
So now you are just making shit up because your other “points” have been so completely destroyed?
You know, I get the wimpiest Instalanches ever. We’re only up to 260 hits after more than an hour.
Is that fair? That’s not fair.
It just isn’t.
“It’s more of a tradition than anything else at this point, though there are practical reasons as well (which I already pointed out in #10 above).”
Aside from directling traffic here? 🙂
So that first graph, which is a comparative graph making (now) irrelevant comparisons, doesn’t really have a present purpose, as you pretty much admit. If the point is to make some continuing observation that the unemployment rate continues downward (which I can glean anyway from any news article), then the second graph serves that purpose better.
“I have another point, which is that the construction projects, pork projects, and green spending are not very stimulating, even in the long term. I.e., the economic multiplier is likely to be around 1.”
Well, that point can’t be discerned from that first graph, although I trust you that you make that point elsewhere on your site.
The lion’s share of stimulus spending on contruction and “green” projects hasn’t been spent yet (by the states). Traditionally, construction projects have a multiplier of 1.5 or higher — more if it is transportation-related. Of course, I agree witih you that if the spending goes to “Bridges to Nowhere”, that multiplier goes down significantly.
“I think it made some things better, but that it also suppressed some aspects of recovery. Mixed bag.”
Perhaps, although in my view, it’s only Sunday — i.e., too early for Monday morning quarterbacking.
Perhaps, although in my view, it’s only Sunday — i.e., too early for Monday morning quarterbacking.
Then do you or do you not support a second stimulus package?
So that first graph, which is a comparative graph making (now) irrelevant comparisons, doesn’t really have a present purpose, as you pretty much admit.
Aside from the 5 reasons I supplied in #10, that is.
If the point is to make some continuing observation that the unemployment rate continues downward (which I can glean anyway from any news article), then the second graph serves that purpose better.
I think you mean “the unemployment rate continues upward.” And, again, you don’t need to guess at the reason – the points of continuing to publish were supplied in Comment #10. And if you’d prefer to do your gleaning elsewhere, please feel free.
I do agree that the 2nd graph is a better illustration of what’s really going on – I’ve made that point over the last 3 or 4 months.
The lion’s share of stimulus spending on contruction and “green” projects hasn’t been spent yet (by the states).
Painfully true.
Traditionally, construction projects have a multiplier of 1.5 or higher — more if it is transportation-related.
My sense is that we’re not going to be so lucky. But that’s a topic for a post I haven’t yet written.
Perhaps, although in my view, it’s only Sunday — i.e., too early for Monday morning quarterbacking.
In my view, the game was played on Saturday. All non-stimulus projections that I’ve seen showed the employment picture turning the corner in 2010. With the stimulus, we’ll turn the corner in 2010. We’re already too late.
It is *always* worth rebutting the arguments as they come up, you guys. Especially since, when you do it, it’s clear you know what you’re talking about. Especially when you’ve got such a large audience (Hot Air *and* Instalanche? <sigh>)
Me, I rebut an argument by drawing an artist’s reconstruction of my adversary as a baboon’s butt. This, too, is reasonably effective.
[…] Inn0cent Bystanders is known for producing the amended Romer charts on unemployment rates each month, but this chart is […]
Hey Sweasel, how are you doing selling all that Chart Swag?
All non-stimulus projections that I’ve seen showed the employment picture turning the corner in 2010. With the stimulus, we’ll turn the corner in 2010. We’re already too late.
Well, “turning the corner” is just one metric. Hovering at 10% for two or three years (which some have predicted sans stimulus) isn’t a good thing.
Wiserbud —
Then do you or do you not support a second stimulus package?
Generally no — not at the moment. Depends on what it is earmarked for, and how big.
^hey, how about cutting taxes & loosening regulation?
Hovering at 10% for two or three years (which some have predicted sans stimulus) isn’t a good thing
How long does it have to stay at ~10% before we can call the stimulus a failure then?
Because they are not predicting much of an improvement this year..
Hey, regarding this stimulus money on highway projects: There is a section of the 101 that proudly displays a sign noting that some work is being paid for by stimulus money. Sadly, this same work was -=already=- supposed to have been paid for by the two previous state highway bond initiatives. Additionally, other than the sign going up, there has been no ACTUAL work on this road. Why is this constant fleecing not noticed by more people and why are more people not completely disgusted and holding their officials accountable?
I can’t watch these thieves every second of the day to keep them honest, so my approach is to vote “no” on everything asking for money.
I think I’ve cleared a solid twelve bucks, Michael! That’s not as bad as it sounds, actually — it’s low because most of that is postcards (on which I make but a few cents). Which means people are probably emailing the thing to their various representatives. Which tickles me pink.
For a money maker, Zombie Santa Christmas cards was my champ this year.
I don’t know anything about economics, but if I were asked to stimulate the economy with $750 billion fast, this is what I would do:
rough US population = 300 million. Thus we are talking about $2500 per person. I would simply send each of them a $2500 debit card, with a 6-8 month expiry date. Can’t be used for taking out cash. Can be used for spending, paying down debt, paying bills, anything you want. Can’t be used outside the US.
You would get stimulated up the wazoo.
Ace-a-lanche
You think my scheme would fuel inflation? Great! Cut the amount in half, avoid the inflation, and save $375 billion.
Ace-a-lanche
3 in one day!
I think I’ve cleared a solid twelve bucks, Michael!
Woo hoo! I think you should march right down to the pub and blow it on beer.
You would get stimulated up the wazoo.
Let’s cut out the middle man and just give everybody wazoo stimulators.
I think I’ve cleared a solid twelve bucks, Michael!
Don’t forget the 18 click-throughs today to the Zazzle page. That’s pretty much money in your pocket right there.
this is what I would do:
I like your idea, Tushar. You got my vote. I’ll spend my $2,500 on hookers and bourbon. My stimulus money will be gone in about a week.
I’ll spend my $2,500 on hookers and bourbon
Which, I wonder, has a better multiplier effect?
[…] its unemployment reports on Friday nights. Meanwhile, geoff at Innocent Bystanders updates his Stimulus chart with the new […]
On the one hand you got your counseling and medical treatments for the traumatized hookers, and on the other hand you get the windfall from recycling the empty bottles.
Close call.
Which, I wonder, has a better multiplier effect?
I’m betting the hookers. They’ll turn that money right over to score some blow.
I hereby rescind my “My bad.”
can we do that?
back to reading
To anyone at all out there: Do you think the officers on the Titantic were running around pointing fingers like in the above? Probably.
Guys, the boat is sinking. What can be done to save it?
I said it over at AoS where he posted your graph, I’ll say it here.
That graph is BULLSHIT.
It has no origin. This is the kind of weasely, manipulated horseshit that Leftist pull, and it drives me nuts. If you think I’ll accept GARBAGE just because it is fed to me by a conservative, think again.
And if you had any integrity, honesty, or balls; you’d put my comment above in your comment hall of
fshame.I said it over at AoS where he posted your graph, I’ll say it here.
Well at least you’re polite.
We’ve had this discussion before (last month), so I’ll give you the short version of the reply:
This graph is not plotting jobs, but jobs lost. It’s just using the jobs scale to show jobs lost. Hence, the only relevant portion of the jobs scale is that from the peak to where we are now.
Why are we focusing on jobs lost? Because we’re trying to determine if the loss rate is slowing down. If we run the scale down to 0 then we’ll never be able to tell.
Then why don’t I plot jobs lost instead of jobs? Because #of jobs provides an additional datum, and it’s more intuitive.
And I don’t particularly care what you will or won’t accept. You either understand the graph or you don’t. Most people get it right away, which is why it’s now also appearing at Instapundit.
Uriel, you have been immortalized!
Hey, I.B., please run that second graph after taking out government jobs.
Geoff, I was wondering the same thing as Socratease. Maybe show with and without government employees on the same graph.
I’ll bet that would get some links next month as well, because it would make a powerful point and add a new element to the discussion — i.e., the stimulus package is going to the SEIU, NEA, etc.
As other commentators have already pointed out, the procurement process used by the federal government moves slowly. There’s a lot of red tape, but much of it has been developed over decades as a means of reducing favoritism and corruption in the contracting process. That Obama’s administration failed to factor those processes into their estimates says to me that they were either incompetent or dishonest.
Additionally, Obama originally supported reducing reliance on the use of “sole source” awards for contract that were to be funded with stimulus spending that would have guaranteed that the process would be even slower than usual. He also pledged to require competition on contracts over $25,000. The up side to those policies would have been greater competition and better value for the goods and services acquired by the government. The down side would have been additional delays in getting the projects underway.
In any case, it doesn’t appear that either promise has been honored.
Yawn. how bout them cowboys?
“I think it made some things better, but that it also suppressed some aspects of recovery.”
Not really. The only thing it’s actually made better is allow most of the states to pretend that they aren’t completely insolvent, since they’ve spent it on shoring up their budgets.
I doubt this is what Obama had in mind when he said that “most” of the money in the stimulus would go into the private sector. Which kind of blows the following argument out of the water:
“Even if they were close on the total amount of stimulus spending, they didn’t know the breakdown of where the money would be allocated.”
Maybe Obama shouldn’t have claimed that most of the money would be going to the private sector when he was promoting this thing, then, yes?
And it’s patently absurd for K Ashford, or Romer for that matter, to put forth the argument that this downturn was unprecedented. This is EXACTLY the same thing that happened before the 1929 crash–people overleveraging themselves far beyond their ability to pay. That’s why Romer and Bernanke, two scholars of the Depression, have proposed the measures they have in their capacities for the administration and the Fed, respectively. Helicopter Ben has managed to pump up a stock market bubble with his debt monetization program, but Romer (and Obama) made the mistake of thinking that the stimulus was going to be WPA 2.0.
Maybe if they locked up the environmental lobby in Supermax for about ten years, and eliminated all the bureaucratic red tape that goes with infrastructure development their predictions could have come to pass. But the government is far too bloated a beast these days to suddenly arrest a rapidly expanding unemployment rate RIGHT AFTER passing a spending bill (which is what the administration and Democrats promoted this bill as doing, like it or not), and good luck getting things like high-speed rail developed if it has to run through the only ten square miles that Bogner’s Three-Whiskered Split-tailed Mouse live on.
[…] over at Hot Air, Ed Morrissey (via Innocent Bystanders) has provided a chart graphing the declining employment situation the country has been facing since […]
Yawn. how bout them cowboys?
Yawn. Go Pack Go!
Government procurements are, indeed, ridiculously slow. Another thing about government monies: I am actually penalized if my project comes in under budget.
Imagine an insurance company operating on that principle.
Maybe if they locked up the environmental lobby in Supermax for about ten years, and eliminated all the bureaucratic red tape that goes with infrastructure development their predictions could have come to pass.
That’s another thing. The putative economic stimulation created by merely paying government employees can be entirely offset if you look at what you’re actually getting for the money, compared to the productivity of private enterprise.
So much of government is engaged in moving a piece of paper from one office to another, that piece of paper often being an instrument keeping a private enterprise from going about its business.
Don’t we want to use our money productively, instead of just throwing it around, or worse, using it in ways that actually encumber economic activity?
Sincerely, this ‘feed the government first’ attitude is so backasswards that soon it will be a wonder if anyone bothers working for a living at all.
That’s kinda true in any large organization, Mrs. Peel, not just government. For both expense and capital budgets, the basic principle is “use it or lose it.” Project management is deemed to have failed if they don’t get money out the door on time.
This is not entirely unreasonable, given the reality of how difficult it is to allocate resources in a very large (and political) organization. As you correctly observe, thrift is not always rewarded. But the first issue is resource allocation, not thrift.
Typically, it is the capital budget that is the big driver. That is the horse that pulls the wagon which holds expense dollars and headcount. If you don’t spend your capital budget, there’s a problem
The problem with the government system is that fast-track success is defined by your ability to create and expand programs. This is what ambitious managers are encouraged to do. It’s the same in the private sector, but in the private sector that means more jobs, more business, more revenue, etc.
In the government it only means more spending.
“If we run the scale down to 0 then we’ll never be able to tell.”
That’s exactly right! And that’s exactly why the graph was drawn the way it was. So people will see something dramatic, where in reality it is a much smaller relative change.
Foreshortening the graph changes the slope.
If you can put the origin wherever you want, why not put it at negative 145M? What would the slope look like then.
Why make a graph at all, except to present the data visually. What matters in a graph is how it LOOKS.
“It’s just using the jobs scale to show jobs lost.”
Uh, NO. It’s not. That’s the point. The “jobs scale” as you call it starts at ZERO, not 135,000,000.
Hence, the only relevant portion of the jobs scale is that from the peak to where we are now.
Maybe so. But the more context (more years) you show, the greater relevance the recent drop has.
And, as I’ve already said, you’re NOT USING the “jobs scale”. Your using a small portion of it to intentionally exaggerate your point. A point that I must say needs no exaggeration.
Do me a favor. Make two Bar Graphs of the amount of money in my pocket vs the amount in yours. In this graph, I have $45 and you have $41. Make the first graph with the origin at zero. Make the second with the origin at 40.
Which one VISUALLY presents the data honestly?
Did your professors give you good grades on graphs made like this? If so, then the fault is theirs, not yours; but the graph is still faulty.
In the government it only means more spending.
Oh c’mon. It’s fair to assume that government is less efficient than the private sector, but you can’t say it is totally unproductive.
“Uh, NO. It’s not. That’s the point. The “jobs scale” as you call it starts at ZERO, not 135,000,000.”
I should point out that this is exactly why nobody shows graphs like yours. They graph unemployment as a percentage. Because with the origin at zero, the REAL changes are easy to see.
If you’ve a problem with the unemployment numbers, and you think this data more accurately represents REAL TOTAL job losses; why not just flip the graph upside down? That is, subtract the number of jobs at each point from the number of jobs at the beginning of the period. THAT would be an honest graph, but it would still be mostly meaningless without some idea of full employment — which is why you could present it as a percentage, as they do with unemployment.
So people will see something dramatic, where in reality it is a much smaller relative change.
That’s incorrect. We’re looking for changes in the rate of job loss, not for changes in jobs. Therefore we focus on the portion of the graph showing lost jobs, so that we can get higher resolution there.
Foreshortening the graph changes the slope.
No. It may change the visual perception of the slope, but the slope is independent of the data range.
The “jobs scale” as you call it starts at ZERO, not 135,000,000.
I already explained this point.
But the more context (more years) you show, the greater relevance the recent drop has.
I thought we were talking about the ordinate, not the abscissa. Now you want more years as well? I suggest that you go ahead and make your own graph, just the way you like it. Then tell me if the rate of job loss is slowing down or not.
Make two Bar Graphs of the amount of money in my pocket vs the amount in yours.
Again, I’m not interested in the amount of money. I’m trying to find out if the rate of money loss is accelerating, slowing, or staying the same. Plotting the full scale makes that more difficult to determine.
Did your professors give you good grades on graphs made like this?
Of course they did. In physics we understood that when you’re trying to find a second derivative, it is the change that matters, not the DC bias of the change.
And that’s it. As I mentioned before, we had an old guy with a similar misperception making the same point last month. After two rounds of this, I no longer have the patience for people trying to impose the pre-calculus graphing rules they learned because they don’t understand the point of the plot. You’re on your own from here on out, bucky.
It’s fair to assume that government is less efficient than the private sector, but you can’t say it is totally unproductive.
We’ve covered this point before. Yes, in some cases government provides services that improve private sector performance. In some cases they are simply necessary for the private sector to exist (the judiciary and military, for example). But the promotion grading for ambitious employees does not emphasize expansion for improved private sector performance, it emphasizes expansion.
This is why, as government grows, the private sector is more hindered than helped.
Pie charts Geoff, needs more pie charts. And prettier colors.
Pie charts Geoff, needs more pie charts. And prettier colors.
What I was thinking of was doing a spline fit to the data, and then plotting up the 2nd derivative of the spline. Unfortunately, it wouldn’t appeal to a very broad audience.
So, back to pie. And the pretty.
Seems like a lot of folks come in here to pound the table over the chart.
Uriel has managed to put his laserlike focus on the least important part of the presentation, for the third or fourth month in a row. Yet he hasn’t managed to produce a single graph to show why his idealized presentation is better. Leave him to the dustbin of history, Geoff.
And here’s the thing about stimulus money and the lag time between appropriation and expenditure.
That $787Bn is unavailable to be borrowed by the public sector. There is at any one time only so much money supply available. When the government hoovered it up, that made it that much more difficult for private borrowers to get money. So there’s something around a half trillion dollars right now that no one can use.
Furthermore, K Ashford missed the news that about a third of stimulus money didn’t go to infrastructure, but as noted, to papering over state shortfalls, mostly in Medicare/Medicaid. That’s no stimulus. That’s using a line of credit to pay off a credit card.
Yes, the Bush team was much more accurate in its forecasts. In Feb 2008 they forecast no higher than 5% unemployment through 2010. Great call!
Yes, the Bush team was much more accurate in its forecasts. In Feb 2008 they forecast no higher than 5% unemployment through 2010. Great call!
Dude, seriously?
Feb 08 predictions are comparable w/ Jan 09 predictions?
Not that the Feb 08 prediction haven’t turned out to be bullshit, but you don’t see the difference in comparing tangerines and tangelos?
@118 In Feb ’08 they forecast unemployment for 2008 at 4.9%. Came in at 5.8%. They forecast 2009 at 4.9%. Came in at 9.3% (oops). They forecast NFP gains of +109k/month for 2008. They missed that one by a few hundred thousand per month. They forecast 2009 NFP gains at +129k/month. Missed that one by a few hundred thousand per month. Missed GDP. Missed about everything — even for 2008, the year the forecast was made. Just like Obama — apples to apples. It’s right there in the table, and there is no disputing it. That track record is no better, and arguably worse.
Bush’s team’s economic forecast was just as bad? C’mon, the new day that dawned ought to be running rings around ChimpyMcHalliburton. At least they should be, just as good? Better?
Also, Bush’s team didn’t use their forecast to justify trillions in new spending to keep unemployment down.
@120 Yes, the Bush team’s economic forecasts were just as bad, if not worse. And though the absurd forecasts they put forth were not used to “justify trillions in new spending,” (just $150 billion of wasted mini-stimulus) an honest assessment of where we were at that time — which really wasn’t all that hard to make — would have gone a long way toward taking some steps that might have mitigated the crisis.
Anon has to be the most disingenuous commenter in the history of the interwebs. I could be talked into ‘stupidest’ but I’ll give it the benefit of the doubt as I suspect it’s kind of logic flies at the neo-communist blogs like Fire Dog Lake or DU, but here we just laugh at you! Ha!
Yes, the Bush team was much more accurate in its forecasts. In Feb 2008 they forecast no higher than 5% unemployment through 2010. Great call!
You’ve completely missed the points. Here’s what we’re really saying:
1. The analytical foundation for Romer’s projections was weak and inadequate to justify committing $787 billion. Yet it was used as the primary source for that justification.
2. Romer’s timelines for Stimulus spending were naively optimistic, by at least 6 months. They indicated a complete lack of familiarity with federal and state procurement systems.
3. Original criticisms of the Stimulus package were attributed to racism. It’s pretty clear at this point that those criticisms should have been attributed to common sense instead.
4. Despite the administration’s claims in Feb-May and Jul-Dec, the Stimulus still has yet to have a significant effect on job loss and the unemployment rate.
Finally, I’ll note that your “apples-to-apples” comparison is anything but. You have to start with initial conditions and then calculate the predicted and actual changes from that point. Doing that, you’ll find that Romer’s predictions were off by 200% within a couple of months, and were off by 400% within 5 months. By comparison, missing the 2008 unemployment rate by less than a point is laudable.
If you want to do a better job of “apples-to-apples” comparisons, compare the 2009 predictions of the CBO, Bush’s economic advisors, Romer’s team, and the Blue Chip economists, which were all made in the Dec08-Jan09 timeframe. That gives you a direct comparison of their competence with the same starting conditions.
But I’ll agree with one thing: economists’ predictions are teh suck. Universally. White House, CBO, Blue Chip – they all suck. But Romer’s analysis was flawed in obvious and fundamental ways, and should never have been used to justify spending of that magnitude.
And with that, I’m out of here to fix toilets and computers. Family life is so rewarding.
Anon has to be the most disingenuous commenter in the history of the interwebs.
Gonna add pusillanimous to your disingenuous.
@ 122 Straight for ad hominem. Nice. Dismissed.
@ 123 I have not missed the points. I am not interested in further discussing or defending the Obama/Romer/Bernstein forecasts, and I did not mention them in my initial post (nice straw man, but I’m not taking the bait. Sorry.) Bush’s Feb 2008 Table 1-1, which I linked to, is in the public record (obviously). It is woefully, hopelessly, laughably wrong in just about every way, for 2008 and every subsequent year. Policy decisions were made off those forecasts, and a more accurate assessment at that time would likely have yielded better policy. You folks can party on about Obama’s Jan ’09 forecasts all you like, it’s of no consequence to me. What I’d like to see is some defense, explanation, justification, of how Team Bush got it so wrong (e.g. +1.3MM jobs for 2008 vs.-2.9MM actual, a miss of about 4.2MM).
“You folks can party on about Obama’s Jan ‘09 forecasts all you like, it’s of no consequence to me.”
Thanks.
“What I’d like to see is some defense, explanation, justification, of how Team Bush got it so wrong”
Maybe you should start your own blog, and write about it there, Anon, then you could get comments about what you want to talk about. We’ll be here, partying on with the chart.
*pops champagne*
I am not interested in further discussing or defending the Obama/Romer/Bernstein forecasts, and I did not mention them in my initial post
Then you’re not really on topic here, are you. Take your little “Bush got it wrong” show on the road – it’s old, irrelevant news. We don’t even disagree completely – we never liked most of Bush’s economic policies, and he was certainly the guy in charge when the financial system blew up. There’s plenty of blame for the situation, but he, by virtue of his position, has to be at the head of the line. But that’s all history now, and not of interest. Talk about it at your own blog.
This post is about the current efficacy of the stimulus. If you don’t want to talk about that, then don’t accuse me of creating a strawman argument when I try to stay on topic.
What I’d like to see is some defense, explanation, justification, of how Team Bush got it so wrong (e.g. +1.3MM jobs for 2008 vs.-2.9MM actual, a miss of about 4.2MM).
Look somewhere else. We have no interest in the windmills at which you prefer to tilt.
“You folks can party on about Obama’s Jan ‘09 forecasts all you like, it’s of no consequence to me.”
That one really cracks me up. “Today’s policies are of no importance – it’s the policy mistakes of two years ago that are really troublesome.”
Some people can’t live without Bush to hate.
HEY!
Go fix the terlit. I got this.
*Michael reviews thread*
As the Site Administrator of Innocent Bystanders, I hereby declare that Anon won this debate. He crushed us, totally made fools of us. I don’t know how we can live with ourselves after this debacle.
Anon, you happy now?
OK then. Bye.
@ 122 Straight for ad hominem. Nice. Dismissed.
Hahahaha! I usually like to get a little discussion under my belt before walloping a troll but you are so bad I couldn’t help myself.
Go fix the terlit. I got this.
Yay! Can we devolve into straight on name calling? Please, please, please?!
Knock yourself out Tattoo.
*hands over framing hammer*
Yes, Tats, you may. Maybe a little something like “I have a feeling if Anon ever had an intelligent thought in his life it probably died of loneliness”
Hahahah Brew, I think his intelligent thought ran away w/ the milkman.
Yay! Can we devolve into straight on name calling? Please, please, please?!
It’s probably the only way for us to regain our self esteem.
How about, the only point anon has is the one on his head?
I hereby declare Geoff the one-eyed man in the land of the blind. The rest of you folks are truly about as clueless as I’ve seen on the web, and that’s saying something. Geoff, you actually seem to have an IQ above room temperature, unlike your colleagues here. I hope to be back next month when the chart gets updated again. Between now and then, perhaps you folks could work on an actual explanation as to how the Bush team got their numbers so wrong.
See ya Feb 5!
I love the reasoning though – “It was OK for the Obama administration to gamble more than a trillion dollars based on a wildly faulty economic forecast contemporaneously criticized by literally hundreds of economists BECAUSE BUSH IS BAD AND ALMOST KINDA NOT SORTA DID MAYBE SOMETHING REMOTELY SIMILAR A LONG TIME AGO THAT WAS APPROVED BY A DEMOCRATICALLY CONTROLLED CONGRESS! YEAH!
For my friend Anon => http://tinyurl.com/cxlbjr
Going to go watch football now, bye!
140. BrewFan – January 9, 2010
I love the reasoning though – “It was OK for the Obama administration to gamble more than a trillion dollars based on a wildly faulty economic forecast contemporaneously criticized by literally hundreds of economists BECAUSE BUSH IS BAD AND ALMOST KINDA NOT SORTA DID MAYBE SOMETHING REMOTELY SIMILAR A LONG TIME AGO THAT WAS APPROVED BY A DEMOCRATICALLY CONTROLLED CONGRESS! YEAH!
Don’t forget that the economic information the Democrats operated on WAS SO CLEAR AND UNAMBIGUOUS that the Stimulus had to be passed before anyone even read the goddam bill.
I hereby declare Geoff the one-eyed man in the land of the blind.
Someone hasn’t read his H.G. Wells.
Or maybe he has!
I hope to be back next
Could you not?
I thought you didn’t care I am not interested in further discussing or defending the Obama/Romer/Bernstein forecasts, . Honestly, we can just sockpuppet a pusillanimous, disingenuous, helmet wearer and call it all good. It might be a stretch, but we’ve got a good group of people here, I’m sure someone can make it happen.
See ya Feb 5!
Damn, Anon, I said you won!
Have you no mercy? Not even an ounce of pity for the “clueless”?
It’s just sick that you want to come back and thrash us again next month. We’re not worth the effort.
(BTW, Mrs. Peel is correct. You have not read Wells.)
Between now and then, perhaps you folks could work on an actual explanation as to how the Bush team got their numbers so wrong.
Dude, fuck off. Maybe, since you’re so smart, you could work up an explanation and dazzle a bunch of goats, ‘k.
Between now and then, perhaps you folks could work on an actual explanation as to how the Bush team got their numbers so wrong.
I take it that reading my comments is too demanding? I thought I said not only “no,” but “Hell no.” Let me make it more clear:
I am not going to review the Bush predictions. They are not relevant, they are of no interest, they are now ancient history, and I don’t have the time.
I’m sorry that no one will join your “Discuss Bush Until We Die” club, but that’s going to have to be a cross that you bear.
Someone hasn’t read his H.G. Wells.
That guy was totally messed up. He should have just kept his mouth shut and scoped the babes when they got nekkid. Then Wells could have called it The Country of the Blind and the Horn Dog.
Then Wells could have called it The Country of the Blind and the Horn Dog.
Nah. The blind people would have immediately heard him whacking off and given him a good thrashing for such unsocial behavior in public.
Kinda like you did with Anon.
Oops, wait a minute. I said Anon won the thread, and I’m sticking to my story.
Nah. The blind people would have immediately heard him whacking off and given him a good thrashing for such unsocial behavior in public.
Well, at least shoe mirrors would have still worked.
Actually, Geoff, my real favorite on this thread was Uriel. He surely pwned your ass on the proper use of the Cartesian coordinate system.
Ouch!
Can you sit down yet?
You went off the rails, Geoff, when you tried to explain second derivatives to Uriel, rather than the size of his mama’s vagina.
I’m disappointed in you.
Actually, Geoff, my real favorite on this thread was Uriel.
I liked the civil, cordial way he started off his criticisms.
I also like the way they think this is some major revelation – that the ordinate doesn’t run to 0. Not at all, of course. It’s the first thing that would occur to anybody who didn’t understand what the purpose of the graph was.
Obtuse and obvious is no way to go through life, son.
You went off the rails, Geoff, when you tried to explain second derivatives to Uriel, rather than the size of his mama’s vagina.
Back to remedial troll-busting.
[…] Boring Unemployment News And this month’s unemployment rate is . . . 10.0%! Same as last month. Here’s the chart: […]
^
In this context, that entry is hilarious!
I liked the civil, cordial way he started off his criticisms.
Seriously, I give both Uriel and Anon some props for that. They were trying to engage, more than your average liberal. They just don’t know what they are talking about, so that’s difficult for them. That is always the problem talking to them. They know the received wisdom of their kind, but they have not actually done any meaningful research or critical thinking.
Geoff, will you autograph our insulated mug?
*Bringing it on a trip… to… you know…*
*Wanna have a beer and burger with you and Mrs. Geoff while I’m at it.*
She means an insulated mug with The Chart on it. I bought one from Weasel, along with a regular ceramic coffee mug that I used this morning.
It was my little way of helping Weasel through the
global warmingclimate change that she is now experiencing.68. geoff – January 8, 2010
You know, I get the wimpiest Instalanches ever. We’re only up to 260 hits after more than an hour.
Is that fair? That’s not fair.
It just isn’t.
I think your headline is the problem, frankly. That first word is the killer.
Next month entitle it ‘XXX VIDEO NUDE TWINS IN HEAT [unmplmnt chrts]’
Geoff, your Instalanche was weak because Glenn stole your whole chart, so very few people amongst his gazillion visitors had a motive to click through.
Now think about that.
Does traffic matter? Or maybe changing the terms of political debate in America?
That’s why I bought the darn coffee mug, Geoff.
I’m pretty sure The Chart has altered the political debate in America. The Chart preceded the Tea Party movement. Think about the exact people who The Chart was reaching, back then.
And I deserve all the credit for this, because I was the guy who encouraged you to post something at IB.
See?
It’s all about me. And my coffee mug.
They say – low but prolonged pain, or high but short pain. Either way, the economy fixing itself is painful. (Notice the reflexive? No person or institution can mess up or fix up the economy. It’s cyclical. It busts and booms and so on and so forth. The economy will rise. It’s just a matter of when and how. And just as the sun shines in the morning, the economy in the future will tank.)
And the way I was taught – Paul Volcker came and undid many of the government’s past policies; his actions led to immense suffering. But it is only through this suffering that we were able to rise. I’m sure others would see it otherwise, but people who think policies like Obama’s saved us in the past don’t know the past very well.
And lest anyone think such uncompassionate stuff is the domain of Republicans – it was Jimmeh Carter the Rabbit Target who brought on Volcker (although Carter didn’t know what Volcker would do – some say he wouldn’t have brought Volcker on if he knew what he would do). Reagan didn’t agree entirely with Volcker but kept him on anyway.
Musli, you are absolutely right to focus on the Fed.
Modern economies are all about the credibility of fiat currencies. Maybe that’s not right, but it is the world we live in.
I mean, why do you think China gets away with its piratical FX rates?
Look at their GDP growth rate. You think they are going to buy into the Global Warming religion and hamper that growth? Not likely.
It’s just math.
Right now, China is holding hundreds of billions of dollars of U.S. paper that is looking increasingly shaky.
They don’t want us to fail. They just want us to know our place. That SNL sketch expressed a fundamental reality.
Ummm, could someone repost the SNL sketch link? Please?
Found it! Site Administration can delete 167 and 168.
>> Geoff, my real favorite on this thread was Uriel.
Drive by troll. You can’t even spot them anymore. He ran off like a bitch at the word “abscissa.”
Of course they did. In physics we understood that when you’re trying to find a second derivative, it is the change that matters, not the DC bias of the change.
And that’s it. As I mentioned before, we had an old guy with a similar misperception making the same point last month. After two rounds of this, I no longer have the patience for people trying to impose the pre-calculus graphing rules they learned because they don’t understand the point of the plot. You’re on your own from here on out, bucky.
I quote this because this is as close as geoff gets to losing his temper, and it made me giggle.
Does traffic matter? Or maybe changing the terms of political debate in America?
Debate, shmate, give me the hits.
I keed, of course. The fact that Ace, Hot Air, and Instapundit all picked up on the 2nd graph this time was great. I’ve been pitching it for 3 months and it finally took.
*Wanna have a beer and burger with you and Mrs. Geoff while I’m at it.*
That would be delightful. I have just the place, unless you already have one.
I quote this because this is as close as geoff gets to losing his temper, and it made me giggle.
Oh you.
Seriously, I give both Uriel and Anon some props for that.
I was actually being ironic. Here’s Uriel’s opus on the thread:
Anon was rational and not immediately incendiary, but ??? This whole “I’ll define what we talk about and don’t stray off my point” thing from a visitor to the blog was a little pushy, no?
You’ve totally missed the point. The question was, do PETA supporters enjoy lolcats, and if they do, do they feel guilty about it?
http://tinyurl.com/y99ggh2
I’m going to sit right here and hold my breath until the thread revolves around me.
I’m going to sit right here and hold my breath until the thread revolves around me.
Like the cosmos itself, all threads on all blogs revolve around you. And they will for all time.
*gets dizzy, throws up*
Theologically, we refer to lauraw as the First Cause.
I’m not cleaning that mess up!
All Hail LauraW!!
The “Leadership” That Can’t Shoot Straight…
Once again, it’s time to point out just how disingenuous our country’s “leadership” is when it comes to making the case for government-based solutions:…
That would be delightful. I have just the place, unless you already have one.
Trust your suggestion. I’ll email ya soon. Date range for visit set.
*noodles on… ‘delightful’*
*packs Sharpie for autograph*
*smiles*
*de-lovely!*
http://pajamasmedia.com/instapundit/91505/
Looks like Christina Romer thinks the stimulus didn’t work so well.
Sounds like she’s getting a tiny clue, though she’s still soft-peddling the numbers.
[…] Y respecto al paro. Pues el año 2009 se cierra con la respetabilísima y casi inaudita tasa del … 10%, como publica el Bureau of Labor Statistics (BLS). Una barbaridad para Estados Unidos, y una prueba del fracaso estrepitoso del Plan de Estímulo para proteger el empleo. Vuelvo a los gráficos de Geoff en el blog Innocent Bystanders: […]
[…] Rejected — Out-of-control, crony-favoring spending that has “stimulated” nothing but the growth of crowds at the unemployment office. […]
[…] Rejected — Out-of-control, crony-favoring spending that has “stimulated nothing” but the growth of crowds at the unemployment office. […]
[…] Democrats have to show for it are a giant spending bill they swore would keep unemployment below 8%, unpopular bailouts and union giveaways, and two drafts of a health care bill that are so full of […]
[…] these numbers by multiplying the labor force by the expected unemployment rate with the stimulus (per this chart) and then subtracting that number from the labor force times the actual unemployment […]