A year ago, Timber, georgeob1 and I exchanged some testable predictions in a now-dormant thread called "Let's talk about George W. Bush in 2004". I started it by offering a bet (
post here), Timber took me up on it and invited me to negotiate the terms via PMs (
post here), and George offered a few prediction of its own (
post here). Somehow Timber and I never got around to finalizing the bet. But I think it might still be fun to look back and see how we did. So let me start with mine.
On January 3 2005, Thomas wrote:1) America's GDP will grow by 3-4%. Jobs will continue to be created, but it won't be enough to keep pace with the growth of productivity and the labor force. As a consequence, payroll employment on January 2, 2006 will be lower than predicted in the 2004
Economic Report of the President
.
US GDP growth: 3.8% (
Source: Bureau of Economic Analysis)
Payroll employment: 134289 M (Source:
Bureau of Labor Statistics)
Payroll employment predicted in the 2004 economic report of the president: 136.3 (for 2005), 138.6 (for 2006) (Source:
2004 Economic report of the president. Skip to page 16 of the PDF file, which is page 98 of the paper document)
So this prediction was correct.
On January 3 2005, Thomas wrote:2) The budget deficit and the current account deficit will both be larger than they are today, both in absolute numbers and as a share of GDP. As a result, America will be even closer to a balance-of-payment crisis than it is today. Alas I don't know how one would objectively measure "closeness to balance of payment crises", so I'd welcome any suggestions you might have.[/url]
(
Source: Bureau of Economic Analysis)
US Current Account Deficit, 3d quarter 2004: $164.7 billion, or 14% of GDP
US Current Account Deficit, 3d quarter 2005: $195.8 billion, or 18% of GDP (
Source: Bureau of Economic Analysis)
US Budget Deficit 2004: 47 B, or 4% of GDP (Source: Congressional Budget Office (
PDF))
US Budget Deficit 2005: 57 B, or 4.5% of GDP (Source: Congressional Budget Office(
PDF)
In other words, my prediction was correct about America's current account, incorrect about the federal budget.
On January 3 2005, Thomas wrote:) If another major source of conflict arises -- candidates include a conflict in the Taiwan street, revolutions in Iran or Saudi Arabia, or an escalation of the conflict with North Korea -- America will find that its military lacks the personnel to deal with it. In this case, the Bush administration will either forsake its allies or reintroduce the draft.[/url]
No major source of conflict did arise, so the prediction cannot be tested.
On January 3 2005, Thomas wrote: 4) The situation in Iraq will deteriorate further. As an objective measure of the deterioration, the casualty rate in the fourth quarter of 2005, as measured by
icasualties.org, will be higher than the casualty rate in the fourth quarter of 2004. I see a 4:1 chance that even the conservatives on A2K will acknowledge the deterioration. If so, I see a 10:1 chance that they will blame it on anything but the policies of the Bush administration. As a test of these probabilities, I invite A2K's conservatives to bet with me on these odds. (But if they do, I won't count their voice about the "acknowledge the deterioration" part.)
Iraq casualties, 4th quarter 2004: 284
Iraq casualties, 4th quarter 2005: 253
Interpretation: My prediction was wrong.
So overall, it turns out that I was more right than wrong with my skeptical assumptions about the Bush economy and its labor market, while I was wrong, but not terribly wrong, about Iraq. I'd say my predictions clearly didn't do great, but they kinda did okay.
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