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The Narrative Falls Apart

By Joseph Lawler on 12.3.10 @ 5:18PM

Looking at this morning’s terrible employment numbers, David Leonhardt of the New York Times begins to despair in a blog post titled “So Much for Momentum”:

For more than a month now, you could have made a case that the recovery was gaining momentum. Stocks were generally rising. Retail sales over the Thanksgiving weekend were strong. Job gains had been accelerating.

But you can’t make that case very well any more.

Yet the Congressional Budget Office, in its latest update on the Obama stimulus, reports that the program should be having its greatest effect right now (emphasis mine):

The effects of ARRA [the stimulus] on output peaked in the first half of2010 and are now diminishing, CBO estimates. The effects of ARRA on employment and unemployment are estimated to lag slightly behind the effects on output; they are expected to wane gradually beginning in the fourth quarter.

In other words, not only the level of the dots below is wrong, so is their pattern: as the stimulus’s effect on employment is peaking, they should be going down, not leveling off.

In reality, I don’t think that it’s possible to identify the effects of the stimulus by looking at a graph of the jobs data — or really any other way. But why not play the administration’s own game? For instance, the chair of the president’s Council of Economic Adviser, Austan Goolsbee, directly attributed the improvement in private sector employment over his presidency to the stimulus:

Lullabys, Legends and Lies| 12.3.10 @ 7:51PM

If you watch this video very closely, you can actually see this guy's hair falling out in clumps, with each lie he tells. Now don't point out a very obvious fact MR I'mlosingmyhairasIspeak (I think that might be a French surname?), that this recession begins on your stupid whiteboard, several months after the Democrats take control of Congress. Was this just a coincidence? Could the Democrats, and their (Coke addicted like) spending spree policies, have had anything to do with where we are today? Nah, what was I thinking, they're all for the working class aren't they? Of course they are, but then again, what do I know, I'm just another bitter-clinger, so I guess I don't know what I'm talking about. Green Government jobs for everybody!! Profits and Taxpayers be damned!!

Laura| 12.4.10 @ 8:05AM

The graph above illustrates the perils of government by computer model. The administration came out and confidently predicted that their stimulus would create (then became create OR save) 3 million plus jobs. Just like the global warming computer models that produced the hockey stick graph. Maybe one day folks will really realize that garbage in equals garbage out, especially in computer modeling.

Curly Smith| 12.4.10 @ 8:57AM

It's not the computer modeling so much as it is the "garbage in". Since the economy, like the climate, is far too complex to model certain simplifying assumptions were made by the geniuses behind ObamaVision:

- recessions last an average of 15 months
- massive government stimulus revives a flagging economy (Keynesian economics)
- the economy will recover irrespective of their actions

The first is true, the second is false and the third has generally been true in the US but it says nothing about how the economy would have recovered if the politicians hadn't stolen the fuel (capital) that runs the economic engine.

The root of the ObamaVision failure, however, lies in the conclusion that politicians spend your money more wisely that you do, which is demonstrably false. The surest way to economic recovery is by drastically lowering taxes and getting the governmental impediments out of the way. But if your desire is total control then you'd rather reign over a smoldering junk pile that govern a prospering nation. Can you say "Hugo Chavez"?

The problem is the "garbage in" the White House, maybe in 2012 we can take the "garbage out".

matthew s harrison| 12.4.10 @ 1:34PM

At no time could you make the case the economy was getting better-at no point.
People shopped on and after thanksgiving, because the retailers are GIVING PRODUCT AWAY.
Secondly, the only guys in the equities markets are the traders at desks-little old ladies, and retired people are out of the equities markets, out of the bond markets, and out of the fund markets. the traders at all the big IB's are the only volume makers-and they take profit now at their leisure-and literally control market moves. The insiders like soros are the only outside entities who are making dough-and they are doing it on insider information-and when they take their profit-the market will crumble.
The unemployment rate hasn't stayed stable-it has continued to rise-and the figures were held from the voters the week before and the week of the election-and they took a turn downwards heavily-and will do so if the congress doesn't solidify the bush tax cuts.....which by the way was the only move W ever made that was strategically sound on its face. Leaving that time bomb for Barry was a classic f-you to the democrats.
The congress will not lower taxes, and will not modify the tax code from its current onerous state, as all the frosh are now seeing just who makes the calls on capitol hill-not congressmen/women, but money guys from PAC's-and since these frosh have been dialing for dollars since the phone lines were installed in their offices-expect them to continue to bend over the electorate, to keep those cushy gigs, with monsterous paychecks, ridiculous pensions, and healthcare provided by us.
The more these major losers like boehner and mcconnell sit back and let the dumbs run roughshod over the economy, the more next year appears to be the year that America breathes its last breath.
I do however love watching the hacks at the old gray prostitute wringing their hands and bitching about the communist nation that the US won't be. We will be ruined-but at the end of the day, the impostor in chief-and those around him are starting to realize that legislation won't happen to further their agenda-and there is only so far you can go with regs from EPA, FDA, etc-and that the EO's only last until 2012, when an adult is once again elected to the CiC position.

martin j smith| 12.5.10 @ 8:08AM

There are those who when Obama took office( and even before he was elected ) said that his goal was to destroy this country as we know it. Many, did not believe it. How about now ? If the Republican Party has the guts ( and boy it will need them big time ) they will have to stand and confront Obama and his administration take their class warfare rhetoric and attacks but tell the American People the truth. The increase defici twill destroy us. And, in extremely stark contrast state: If want to save this Republic vote for us. If not, vote for them. Its as simple as that !!!!!!!!!!!!!!

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