September 15, 2003

Mickey Kaus Confuses Himself Once Again

For no discernible reason that I can imagine, Mickey Kaus picks today to trash the New York Times's Edmund Andrews:

Mickey Kaus: I'm quite willing to believe that "most economists predict that unemployment will remain almost unchanged at nearly 6 percent through the elections in November 2004." But shouldn't the NYT, after making this surprising assertion at the top of its lede business story, produce some actual evidence that most economists think this? Evidence like a survey of economists, or a blue-chip weighting--or at least quotes or views from a plural number of economists who make such a prediction? All the Times's Edmund Andrews gives us is a) his say-so and b) economist Brad DeLong. DeLong's quote: "I don't see where the demand is going to come from to produce a falling unemployment rate. ... Very few people are predicting real G.D.P. growth of more than 4 percent."

But even DeLong's argument is immediately undercut by Andrews himself, who writes, "More than a few economists say that the economy might expand at an annual rate of more than 5 percent in the final half of this year."... [T]he Times doesn't offer much, beyond blind faith in Edmund Andrews, to convince non-economists like me of either of these things.... I'd even argue the Times has a special burden in this regard because it has such an obvious institutional committment to continued economic malaise. But I doubt Andrews' story meets even normal standards of evidence.

Well, first, it's not that surprising at all. Back last January the Congressional Budget Office was forecasting a 5.7% average unemployment rate for 2004, and since then we've had bad news about the fourth quarter of 2002, bad news about the first quarter of 2003, moderate news about output and bad news about the labor market for the second quarter of 2003, and now we are receiving good news about output and bad news about the labor market for the third quarter of 2003. As all this bad labor market news has come in, forecasts of unemployment in 2004 have been slowly creeping up. One of the things Glenn Hubbard and I used to get ourselves mutually depressed at Jackson Hole was that neither of us could see where America would get demand growth at a fast enough pace to push the unemployment rate down. That the unemployment rate is likely to be near 6% toward the end of 2004 may be new news to Mickey Kaus, but it is really old news.

Second, there is Edmund Andrews's reputation for trying to tell things straight to his readers. That should be worth something.

As for "undercutting"... the word that confuses Kaus is "might." Well, yes, the economy might expand at a faster-than-5.0% per year rate in the second half of 2003. But it doesn't look like that's the way to bet. IIRC, only 3 of the 53 forecasters surveyed in the Wall Street Journal's monthly poll are currently predicting second-half growth at a greater than 5.0% annual rate.

It's sad that Kaus finds himself filing his copy without having been able to check what current economic forecasts actually are. Someone--somebody at Slate--needs to teach him how to use the internet: no one should be forced to file their copy when it is still in such bad shape, and when the Wall Street Journal, the Economist, and the Congressional Budget Office are just mouse clicks away. They say:

The Economist, September 4: The panel is also expecting faster growth in America, where GDP is now projected to increase by 2.4% this year and by 3.6% in 2004...

Wall Street Journal, September 11: The nation's gross domestic product... is expected to grow at a seasonally adjusted annual rate of 4.7% during the current quarter and 4.0% in the fourth quarter.... After this initial burst of growth this year, forecasters believe the pace of activity will slow to a more sustainable, though still respectable, rate of 3.85% in the first half of 2004...

Congressional Budget Office: Current economic projections for real GDP growth: 2003: 2.2%... 2004: 3.8%

From this point, the argument is simple: the U.S. economy needs one annual percentage point of real GDP growth simply to keep up with the net increase in the number of adults who want to join the labor force. Nobody has a good forecast of what the economy's underlying rate of labor productivity growth is today, but 2.5% per year is an effective lower bound to the scatter of uncertain estimates. Thus pessimists about productivity think that we need an average real GDP growth rate of 3.5% per year simply to hold the unemployment rate steady: using standard rules of thumb (which are in very shaky shape right now) productivity pessimists think that a 4.0% growth rate would drop the unemployment rate by an average 0.1 percentage point every six months. Optimists about productivity growth think we need higher real GDP growth than that to hold the unemployment rate steady, and that a 4.0% growth rate is unlikely to lower the unemployment rate at all.

Wouldn't it have been a much better--and much more informative--column if Kaus had checked the growth forecasts before filing? It can't be good for him to have made the false accusation that Andrews tuned his story to make it harmonize with the NYT's "obvious institutional committment to continued economic malaise," can it?

Posted by DeLong at September 15, 2003 04:13 PM | TrackBack

Comments

Professor DeLong says, "Wouldn't it have been a much better--and much more informative--column if Kaus had checked the growth forecasts before filing?"

This is Mickey Kaus we are talking about. The one who finds the posts advocating violence at Lucianne.com so amusing.

So, of course it would be better if he had done some fact checking. It would also be better if your dog brushed its own teeth.

And, yes, it's a wonder to me what institutional stake The Times has in economic malaise. I always thought that their principal revenues were from advertising, and advertising is one of the casualties of a recession.

But then, this is Mickey Kaus we are talking about.

Posted by: Charles on September 15, 2003 04:37 PM

"It's kind of sad that Kaus finds himself filing his copy without having been able to check whether current forecasts of economic growth are in fact higher or lower than 4.0% per year, and current forecasts of end-of-2004 unemployment are or are not 6% or so."

It think it's Kaus's observation that when the Times makes this assertion it's the Times' responsibility to back it up with citations to relevant sources. Saving wondering readers like Kaus that trouble. I mean, is every single questioning reader like Kaus supposed to look these forecasts up on his/her own?

Or, in spite of all the "why can't we have a better press?" messages around here, is everything the press reports supposed to be taken as true without explanation or citations?

"IIRC, only 3 of the 53 forecasters surveyed in the Wall Street Journal's monthly poll are currently predicting second-half growth at a greater than 5.0% annual rate."

See, if you were writing for the Times it'd be a big improvement! If the reporter had included just one sentence like that there'd have been nothing for dumballs like Kaus and me and the average non-economist reader to wonder about.

Did you ever think of doing some editing as a sideline?

Posted by: Jim Glass on September 15, 2003 04:55 PM

That piece by Mickey was hacktackular.

Posted by: Hackenkaus on September 15, 2003 06:41 PM

Give Andrews a break. He has to distill his column to make the word limit. He cannot publish a textbook every time he writes a column. You have to either trust a columnist or not trust. Andrews track record speaks for itself. He is giving the straight dope. However, the recent conservative attack on the NYT as factually challenged may have clouded the Kaus judgement.

Kaus is repeating the conservative charge that Democrats and "liberal"? newspapers like the NYT are criticizing Bush policies as a way to "talk down the economy" and have Bush lose reelection because the economy is bad. It does not occur to Kaus that the NYT and others like Paul Krugman criticize the administration economic policy because the policy truly is bad and that pursuing the alternative course would improve the economy.

Goodness knows we want the president to succeed with the economy for the good of the country. But if he cannot implement responsible policies, he deserves to be fired.

Posted by: bakho on September 15, 2003 07:28 PM

Professor DeLong,

If you were to start a magazine called "J. Bradford DeLong Points Out the Mistakes of Mickey Kaus"...

God help me, I'd subscribe ten times. I swear that I'll never understand why Kaus has a steady job while there's one freelancer left in America. He's not funny, he's not insightful, he's constantly getting things wrong, he rarely seems to do any actual journalism, and he worries his favorite themes like a dog with a bone. (NY Times is liberally biased, Arnold scandals, LA Times is liberally biased, rinse, repeat.) Matthew Hoy would do a better job, and I f'n hate Matthew Hoy.

Plus, the cutesy overuse of bolds, italics, exclamation marks, and asides from his imaginary editor make me want to smack him. I guess the Slate style sheet doesn't allow him to actually type, "I'm smirking right now."

Posted by: Ted Barlow on September 15, 2003 07:29 PM

Professor DeLong,

If you were to start a magazine called "J. Bradford DeLong Points Out the Mistakes of Mickey Kaus"...

God help me, I'd subscribe ten times. I swear that I'll never understand why Kaus has a steady job while there's one freelancer left in America. He's not funny, he's not insightful, he's constantly getting things wrong, he rarely seems to do any actual journalism, and he worries his favorite themes like a dog with a bone. (NY Times is liberally biased, Arnold scandals, LA Times is liberally biased, rinse, repeat.) Matthew Hoy would do a better job, and I f'n hate Matthew Hoy.

Plus, the cutesy overuse of bolds, italics, exclamation marks, and asides from his imaginary editor make me want to smack him. I guess the Slate style sheet doesn't allow him to actually type, "I'm smirking right now."

Posted by: Ted Barlow on September 15, 2003 07:34 PM

That would be The Greatest Magazine of All Time even before it hit newstands.

One hitch though.

Are there enough trees for Kaus' errors?

Posted by: SamAm on September 15, 2003 07:57 PM

Mickey is merely filling a legitimate market niche for tendentious hack journalism. Demand creates it's own supply.

Posted by: Qusay on September 15, 2003 08:34 PM

Hey, I just noticed that one Brad DeLong filed a "Why Can't We Have a Better Press Corps" complaint about the companion NY Times piece to same piece that Mickey queried -- same day's paper, right next to it. http://www.j-bradford-delong.net/movable_type/2003_archives/002213.html

Maybe this is where Mickey learned to query unsupported assertions about economics in the Times? ;-)

"If you were to start a magazine called 'J. Bradford DeLong Points Out the Mistakes of Mickey Kaus'..."

Mickey made no mistake at all here. He said he was willing to believe what was said -- but that the lynch-pin assertion of a story like this should have some reference backing it up. And it should.

After all, we know another Times economics story right next to this one had some real mistakes in it!

"Give Andrews a break. He has to distill his column to make the word limit. He cannot publish a textbook every time he writes a column. "

He couldn't write one sentence to document the main theme of his 1,100 word story? Prof. DeLong wrote one such sentence above. Mickey's now put another such sentence submitted to him on his blog. Coulda been done!

You know, it seems kind of odd how some people can go full bore with a "Why Can't We Have a Better Press?" blast at the Times, while other disapproved folk get ridiculed just for asking about the source for a claim made on the same page of the same paper.

Posted by: Jim Glass on September 15, 2003 09:14 PM

This liberal prejudice against hacks confirms my belief that liberals are the true racists.

I'm off to lucianne.com for tomorrow's story ideas...

Yours in hackery,

Hackenkaus

Posted by: Hackenkaus on September 15, 2003 09:22 PM

This liberal prejudice against hacks confirms my belief that liberals are the true racists.

I'm off to lucianne.com for tomorrow's story ideas...

Yours in hackery,

Hackenkaus

Posted by: Hackenkaus on September 15, 2003 09:30 PM

As long as Mickey Kaus stays employed it allows economists to point out the inefficiencies inherent in a monopoly.

Posted by: Rob on September 15, 2003 10:37 PM

Brad, keep up the great work, you continue to inspire the rest of us, at least myself, to a higher level of thinking!
Peace & Happiness...

Posted by: Jeffrey DeLong on September 16, 2003 01:02 AM

Brad, keep up the great work, you continue to inspire the rest of us, at least myself, to a higher level of thinking!
Peace & Happiness...

Posted by: Jeffrey DeLong on September 16, 2003 01:03 AM

OK Brad, there is a message for you in the post of one "Jeffrey DeLong" -- not even family members can avoid double posts. And you a big old tout for technology and all! Scandalous.

...assuming that DeLong is related to this DeLong.

Posted by: K Harris on September 16, 2003 04:19 AM

Don't forget about real interest rates, which rose very sharply in August. Real short term rates (1-yr. T-bill minus core CPI) are now positive for the first time since March 2002, and real long term rates (10-yr. minues core CPI) are the highest they've been since October 2000. Deflation is hardly defeated, with the annualized core inflation rate in August a mere 1.3%. Is this a "sign of the impending recovery" or the thing that will strangle the infant in the cradle?

Posted by: General Glut on September 16, 2003 06:58 AM

To add to the evidence, the detailed forecast tables based on the Blue Chip Consensus Forecast show the unemployment rate at 5.8 percent in the 4th q of 2004.

Posted by: bhash on September 16, 2003 07:25 AM

Jim Glass oughta hie himself over to Calpundit. There's a (so far) troll-free Krugman thread over there. Some of the regulars seem to be out sick recently.

Posted by: zizka on September 16, 2003 07:39 AM

There are recurring problems with the Crimson Snide's posts on the labor market:

1. Kaus seems not to understand that unemployment is measured by a survey.

2. Kaus seems not to understand that payroll employment and unemployment are measured from DIFFERENT surveys.

He's especially prone to these blunders when trying to put positive spin on the Bush recession. There was an idiotic post about self-employment last week as an example.

Posted by: P O'Neill on September 16, 2003 08:22 AM

Everyone should just stop reading Kaus. I stopped clicking into his stories months ago and feel smarter already. Another bonus is that I no longer have to clean the spittle off my screen as often.

Posted by: fastback on September 16, 2003 10:38 AM

So, this isn't really related but did you give Hubbard a good swift kick in the ass before getting all chummy with him? He should be depressed, and you should be rubbing his face in the carpet so he doesn't shit on it anymore.

Posted by: Gideon S on September 16, 2003 11:51 AM

What Ted said. Every time I click to Kaus I come away amazed that guy has a job. There are 1000 bloggers with more wit, insight and Google skills. I swear, the only original thoughts are the ones based on transparent factual errors.

Posted by: BJ on September 16, 2003 05:40 PM

Brad is ridiculous. Kaus constantly comes up with interesting observations about the way news is presented. Brad, you are an economist, right. Economists are not supposed to bang their head against the wall when they can't figure something out. They should use economic tools to understand why things happen. What are the incentivea and disincentives to having an extremely knowledgeable press corps? What prevents people who have the talent to explain economics (DeLong) from becoming reporters? Ask and try to answer some dam questions like Kaus does. Brad you’re a great economist, but you’re not nearly as good at economics as Kaus is as a media blogger. Bang your head against the wall asking yourself why that is.

Posted by: Skip on September 17, 2003 12:32 AM
Post a comment