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It's the Economy, Stupid

 
 
Chuckster
 
  1  
Reply Sat 7 Aug, 2004 10:42 am
To accuse your Commander in Chief in time of war of deliberately lying to the citizens of his country is not an act of free speech. The First Amendment does not extend to conduct of this nature in the circumstances described. So Mr. Big Stuff: What're ya going ta do for your 6479th Act of Treason?
0 Replies
 
au1929
 
  1  
Reply Sat 7 Aug, 2004 10:54 am
Chuckster
This is not Nazi Germany or Communist Russia. Dissent at any level is permissible, no it is a right and the duty of every citizen to speak out when he disagrees with public officials. I can name a dozen nations where your attitude prevails and I guess you would be more comfortable.
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sumac
 
  1  
Reply Sun 8 Aug, 2004 12:06 am
Chucster said:

Quote:
Do your own searches of any available and credible database.
By every measure the economy is stronger than it ever has been under any administration in history...by any measure.


Sorry, Chucster, that statement is simply not true.
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au1929
 
  1  
Reply Tue 10 Aug, 2004 08:59 am
OP-ED COLUMNIST

Spin the Payrolls

By PAUL KRUGMAN

Published: August 10, 2004


When Friday's dismal job report was released, traders in the Chicago pit began chanting, "Kerry, Kerry." But apologists for President Bush's economic policies are frantically spinning the bad news. Here's a guide to their techniques.

First, they talk about recent increases in the number of jobs, not the fact that payroll employment is still far below its previous peak, and even further below anything one could call full employment. Because job growth has finally turned positive, some economists (who probably know better) claim that prosperity has returned - and some partisans have even claimed that we have the best economy in 20 years.

But job growth, by itself, says nothing about prosperity: growth can be higher in a bad year than a good year, if the bad year follows a terrible year while the good year follows another good year. I've drawn a chart of job growth for the 1930's; there was rapid nonfarm job growth (8.1 percent) in 1934, a year of mass unemployment and widespread misery - but that year was slightly less terrible than 1933.

So have we returned to prosperity? No: jobs are harder to find, by any measure, than they were at any point during Bill Clinton's second term. The job situation might have improved somewhat in the past year, but it's still not good.

Second, the apologists give numbers without context. President Bush boasts about 1.5 million new jobs over the past 11 months. Yet this was barely enough to keep up with population growth, and it's worse than any 11-month stretch during the Clinton years.

Third, they cherry-pick any good numbers they can find.

The shocking news that the economy added only 32,000 jobs in July comes from payroll data. Experts say what Alan Greenspan said in February: "Everything we've looked at suggests that it's the payroll data which are the series which you have to follow." Another measure of employment, from the household survey, fluctuates erratically; for example, it fell by 265,000 in February, a result nobody believes. Yet because July's household number was good, suddenly administration officials were telling reporters to look at that number, not the more reliable payroll data.

By the way, over the longer term all the available data tell the same story: the job situation deteriorated drastically between early 2001 and the summer of 2003, and has, at best, improved modestly since then.

Fourth, apologists try to shift the blame. Officials often claim, falsely, that the 2001 recession began under Bill Clinton, or at least that it was somehow his fault. But even if you attribute the eight-month recession that began in March 2001 to Mr. Clinton - a very dubious proposition - job loss during the recession wasn't exceptionally severe. The reason the employment picture looks so bad now is the unprecedented weakness of job growth in the subsequent recovery.

Nor is it plausible to continue attributing poor economic performance to terrorism, three years after 9/11. Bear in mind that in the 2002 Economic Report of the President, the administration's own economists predicted full recovery by 2004, with payroll employment rising to 138 million, 7 million more than the actual number.

Finally, many apologists have returned to that old standby: the claim that presidents don't control the economy. But that's not what the administration said when selling its tax policies. Last year's tax cut was officially named the Jobs and Growth Tax Relief Reconciliation Act of 2003 - and administration economists provided a glowing projection of the job growth that would follow the bill's passage. That projection has, needless to say, proved to be wildly overoptimistic.

What we've just seen is as clear a test of trickledown economics as we're ever likely to get. Twice, in 2001 and in 2003, the administration insisted that a tax cut heavily tilted toward the affluent was just what the economy needed. Officials brushed aside pleas to give relief instead to lower- and middle-income families, who would be more likely to spend the money, and to cash-strapped state and local governments. Given the actual results - huge deficits, but minimal job growth - don't you wish the administration had listened to that advice?

Oh, and on a nonpolitical note: even before Friday's grim report on jobs, I was puzzled by Mr. Greenspan's eagerness to start raising interest rates. Now I don't understand his policy at all.
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sumac
 
  1  
Reply Tue 10 Aug, 2004 09:13 am
Thanks au. It didn't seem that chucster was really open to being contradicted, so frankly, I didn't bother to take the time to cite the URL's to anything. I was too lazy on that one.
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au1929
 
  1  
Reply Tue 10 Aug, 2004 09:25 am
sumac
I am past the point of expecting the republicans on this or any other medium admitting to any shortcomings of their newly anointed God Bush. They will twist and turn to make black white and white black. Hopefully in Nov. they will be twisting in the wind.
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au1929
 
  1  
Reply Tue 10 Aug, 2004 09:34 am
What to do? What to do? My name is Alan. What to do? Confusion!


USA

Fed expected to raise rates a second time

Posted: Tuesday, August 10, 7:49am EDT

Disappointing job growth in July may prompt Federal Reserve policy-makers to ease off on their plans for regular interest rate increases over the coming months.
Analysts still expected the Fed to move rates up by a quarter-point Tuesday, but some economists believed the Fed would then take a breather until after the Nov. 2 election given the employment report that showed job creation came to a near-standstill last month.

"I think the Fed will conclude that this is likely to be a temporary soft patch of the kind that we have gone through many times before," said economist Lyle Gramley, a former Fed board member.

But the Fed could ease off its credit-tightening plan if the economic data continues to show weakness, Gramley and other analysts said.

"I don't think a rate increase is at all certain for the September meeting," said Sung Won Sohn, chief economist at Wells Fargo in Minneapolis. "It will depend on how the numbers come in, with the next employment report being the most important factor."

The Fed will want to see if the job market bounces back after two disappointing months, including a tiny 32,000 jobs created in July. That's the weakest showing since last December and far below the 200,000-plus new jobs economists had expected last month.

The July jobs report was the most dramatic sign yet that the economy had hit what Federal Reserve Chairman Alan Greenspan had earlier termed a "soft patch."
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Setanta
 
  1  
Reply Tue 10 Aug, 2004 09:49 am
Personally, i accuse the Idiot in Chief of having lied his way into the war which thoughtless conservative robots use as an excuse to condemn the normal, healthy activity of dissenting from the party line of whatever bunch of crooks currently are holed up in 1600 Pennsylvania Avenue.
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sumac
 
  1  
Reply Tue 10 Aug, 2004 10:09 am
LOL, Setanta. Good one, boss.
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au1929
 
  1  
Reply Thu 12 Aug, 2004 07:04 am
  NYTimes.com > Opinion
Painting the Economy Into a Corner


Published: August 12, 2004

President Bush reacted decisively to this month's shockingly bad employment report - by quickly changing the topic to terror. The Federal Reserve chairman, Alan Greenspan, also focused elsewhere, namely on rising oil prices. Mr. Greenspan used inflationary energy costs as the rationale for raising interest rates a quarter point, despite the drastic slump in hiring and a recent slowdown in productivity growth.

What neither man seems ready to acknowledge outright is that policy makers have run out of tools for stewarding an economy that - nearly three years into a recovery - has yet to flourish and may even be downshifting to neutral. The president's fiscal policies, mainly high-end tax cuts, have resulted in a record federal budget deficit without spurring hiring or income growth. If Mr. Bush continues on the tax-cut path, continuing high deficits will further threaten job creation and living standards.

Mr. Greenspan passed up opportunities to discourage Mr. Bush's disastrous tax-cut strategy back when it might have done some good. Instead, the Fed pursued its own stimulative policy, pushing interest rates to the lowest level in a generation. One result has been a debt load that is a big factor in the overall decline in households' net worth, despite the rise in housing values. That alone argues for tightening the money spigot. Another reason for raising rates is that the continuation of a cheap-money policy would probably precipitate inflation, as a glut of dollars would eventually feed rising prices.

Mr. Bush and Mr. Greenspan have now exhausted almost all of their stimulus options. The economy is on its own, and it is not clear whether it is on track for a stronger recovery in the second half of the year.

No wonder, then, that Mr. Bush won't acknowledge the bad news on jobs. Doing so would imply a need to re-examine the policies that have led to this point, something he is not willing to do. Given the facts, his intransigence is appalling: according to a new research report by Economy.com, an independent provider of economic data and analysis, the $700 billion swing from surplus to deficit under President Bush accounted for nearly two percentage points of economic growth a year. But it has generated economic gains of just over one percentage point.

The main reason for the crippling discrepancy is that the tax cuts were mostly handed out where they did the least good - that is, lavished on the people least likely to spend the largess. The reduction in the tax rates, the largest of Mr. Bush's tax boons, provided only 59 cents of economic stimulus for every dollar of lost tax revenue. The tax cut for dividends and capital gains produced 9 cents of stimulus for every forgone dollar. (Did someone say, "Deficits as far as the eye can see"?) In contrast, the economic bang for a dollar of aid to state governments is $1.24. Yet such assistance accounted for only 3 percent of the total cost of Mr. Bush's fiscal policies.

The president was right to use a fiscal stimulus to counter a recession - it's just that his favorite tactics were wrong, and they failed to create an environment that fosters growth in jobs and income. Now, along with outside factors like oil prices, Mr. Bush's priorities are actually contributing to the weak picture for jobs. And in a perverse feedback loop, a continuation of these policies will further swell the deficit, impeding job growth even more.

While the economy is still expanding and jobs are being created, the pace pales in comparison with the pace of other recoveries at this same stage. For real prosperity to take hold, a much broader swath of the labor force must be able to find jobs and earn decent wages. That isn't likely to happen under Mr. Bush's policies.
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Thok
 
  1  
Reply Thu 12 Aug, 2004 07:11 am
I wrote this also in another thread:
Quote:
Phil Derrow, the president and chief executive of the Ohio Transmission Corporation, told the president that despite Ohio's lagging economy, his business selling pumps and compressors had grown because "we've benefited from your policies," Mr. Bush quickly replied, "Keep saying that, will you?"

A short time later, when Mr. Derrow told Mr. Bush that basically "we sell air to our customers," Mr. Bush rejoined, "You and I are in the same business."


That dialog says all about Bush's economy policy!
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au1929
 
  1  
Reply Thu 12 Aug, 2004 07:30 am
Thok
Another example of Bush's level of understanding and intelligence.
Bush does indeed sell air and lo and behold a good percentage of the American people buy it.
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Thok
 
  1  
Reply Fri 27 Aug, 2004 03:35 am
the next ecoomy article, about general issues

Futures markets can help identify successful products, predict revenues, and even forecast whether Bush or Kerry will win in November

Quote:
The Pentagon came under fire last summer for its plan to launch a futures market where traders could wager on the likely occurrence of various economic and geopolitical events in the Middle East, including terrorist acts. The program's goal was to harness the predictive powers of markets in order to get a better analytical handle on a maddeningly complex region of the world--and perhaps prevent another 9/11. But whatever the intent, to many observers the whole idea seemed in poor taste. When plans for the Policy Analysis Market hit the news, headline writers quickly dubbed it "the terror market," and New York Sen. Hillary Rodham Clinton branded it a "futures market in death." But supporting the adage that there's no such thing as bad publicity, prediction markets live on--in the private sector.
advertisement

"There has been a huge surge of interest since the Pentagon controversy last year," says Emile Servan-Schreiber, CEO of NewsFutures, a firm that develops prediction markets for businesses. "These markets got killed politically, but intellectually there was a huge rally in the defense of them, and we started fielding a lot of leads from companies who wanted to try this." Among the firms tinkering with prediction markets to help their decision making and forecasting are Eli Lilly, HP, and Dentsu, Japan's largest advertising agency. In the future, these markets could help forecast everything from corporate earnings to drug approvals to employee retention rates.

Executives at those companies apparently dissent from Danish existentialist philosopher Soren Kierkegaard, who wrote, "Wherever the crowd is, there is untruth." At the heart of these markets is the belief that there is plenty of truth to be found in crowds, that the wisdom of many is often superior to that of one, even an expert. The problem, though, is determining the consensus opinion. This is where prediction markets come in. "There's an old saying that 'All of us know more than any of us,' " says Thomas Malone, a professor at the Massachusetts Institute of Technology's Sloan School of Management and author of The Future of Work, which, among other things, explores the value of prediction markets to business. "Prediction markets help make this old saying a reality. They combine what lots of individuals know into a single consensus view that is usually much more accurate than any of the individual views."

With prediction markets, also called "betting markets" or "idea markets," the current odds or price levels constitute the best available consensus about a particular question. Some of the most well-known and accurate prediction markets are the Iowa Electronic Markets, run by the University of Iowa's business school, where traders speculate about a variety of political and financial forecasts. With IEM's Presidential Vote Share Market, for instance, political junkies can invest as much as $500 in futures contracts based on what percentage of the popular vote President Bush and Sen. John Kerry will each get on Election Day. Currently, each $1 contract is going for around 50 cents, which means the market is predicting a dead-even contest


full report
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