Brad DeLong's Semi-Daily Journal (2004)

But the headline is true!

Another 388,000 people in the work force were beamed up to the mother ship again last month to keep the headline number at 5.6%. Based on the payroll survey and continuing unemployment claims we should be at about 6.5% or so.

Cooking the books is the ammunition for Bush.

Repeatedly, last night, I heard financial analysts on PBS explain that Social Security has only a few years of solvency left and needs to be radically changed. Paul Krugman can show repeatedly that Social Security is solvent for decades and needs only slight tinkering for improvments, but the financial analysts on PBS seem not to be capable of reading.

Compare this headline with those of Fox News and the WaTimes which are far more negative ... I don't know what's happened to the NYT these days.

Funny how suddenly the Household Employment Survey is forgotten:

http://www.epinet.org/content.cfm/webfeatures_econindicators_jobspict

A particularly notable aspect of the weak labor market is the declining trend in the share of the population in the labor force, i.e., the share of persons either working or seeking work. While February's unemployment rate was unchanged at 5.6%, this reflects the fact that the number of labor force participants fell steeply last month, by 392,000, presumably due to the lack of available jobs. Employment in the survey that measures joblessness was also down last month, by 265,000.

http://www.epinet.org/content.cfm/webfeatures_econindicators_jobspict

The impact of the weak job market on wage growth was also evident in today's BLS report. The 1.6% annual growth rate of the hourly wages of blue-collar workers in manufacturing and non-managers in services is tied with the lowest rate on record (posted in December 1986), going back to 1964.

http://story.news.yahoo.com/news?tmpl=story2&u=/bw/20040305/bs_bw/nf20040359557db013&e=4

-----------quote---------------
Yale University economist Ray Fair, an academic with wide-ranging interests, has designed the best-known Presidential election formula. Among the variables he has developed over the past quarter-century are incumbency (the power of a sitting President is formidable), the number of quarters inflation-adjusted growth in gross domestic product per capita exceeds 3.2%, and the inflation rate. The Fair model predicts that Bush easily triumphs in November.

Economy.com, a leading economic consulting firm, also tries to capture the pocketbook issues that would lead an electorate to favor or reject the incumbent. Income growth and inflation play a central role in its forecast, which includes a state-by-state breakdown. Economy.com last ran the model in early February, and Bush won by a landslide, with 488 electoral votes and 57.9% of the popular vote.

WHEN INCUMBENTS LOSE. Not everyone agrees. An intriguingly simple analysis by economist Martin Mauro of Merrill Lynch suggests that the election may be much closer than more sophisticated models calculate. For most people, the economy isn't about growth rates in GDP (news - web sites), productivity, international trade, and other statistical measures. The measure of economic satisfaction is synonymous with jobs.

So, Mauro looked at the change in the unemployment rate in the four quarters up until the vote during the past 13 Presidential elections. The unemployment rate rose only three times since the 1952 election year -- in 1960, 1980, and 1992 -- and in each case the incumbent party lost.
-----------endquote--------------

Three models predicting a Bush win in November (unless something happens that tanks the economy between now and then).

Btw, everyone does realize that "jobs" are not a benefit, but a cost.

The NYTimes implies the poor employment reports provide ammunition for Republicans since George Bush is using weak employment as a rationale in pushing for making sure tax cuts passed are permanent and adding tax cuts. Congressional conservative leaders are busily preparing tax cut legislation. Possibly ending the estate tax is the answer to poor employment.... Doh.

The NYT really is kind of weaselly these days. The David Brooks hire is another example.

I used to think it was because Pinch Sulzberger was afraid of implicitly threatened big fat wringer. Now I think it's part of the NYT's national roll-out strategy: We're not the liberal New York Times at all! Please subscribe, people of Birmingham, Alabama!

This won't work.

"Btw, everyone does realize that "jobs" are not a benefit, but a cost."

Homer Simpson has to be impressed. Hmmmmmmmmmm. Cooooooost. Doh.

>>... I don't know what's happened to the NYT these days.<<

It has become a worthless rag that is hardly worth reading.

Look next for the NYT Headline:

Opinions differ about shape of Earth

Ray Fair's model predicted Bush's father would win a second term, too. That didn't happen. His models fail to take into account the economic indicators that the majority of middle-class Americans actually care about: jobs and median income.

As for Sullivan's asinine claim that "jobs are a cost, not a benefit", that is untrue for over 90% of the population. The only people for whom that is true are those who derive a majority of their income from investments. Even CEOs consider their own jobs a "benefit" - just not those of the people who actually do the work.

And while we're on today's NYT, another snide article from David Brooks, apparently for the sole purpose of listing all Kerry's material assets under the guise of discussing the role of pedigree in America's leaders. (Bush's assets, of course, are not listed).

And incidentally, what does he mean "In Britain neither of these guys could lead a major party. Their upper-crust pedigrees would be disqualifying."? Hasn't he heard of the House of Lords? Does he know that Winston Churchill was the grandson of the Duke of Marlborough? That of the twenty two members of the present Cabinet, sixteen went to Oxford or Cambridge?

David Brooks is quite the malicious worm. Now do not tell me that the problem is space. Davy Brooksy is the same worm at any length in any format. Truth is meaningless in conflict with the purposes of hackery.

now that the house of lords is full of jumped up commoners, I suppose a duke could become party leader again.

http://www.nytimes.com/2004/03/06/politics/06LOBB.html?hp

How Industry Won the Battle of Pollution Control at E.P.A.
By CHRISTOPHER DREW and RICHARD A. OPPEL Jr.

Just six weeks into the Bush administration, Haley Barbour, a former Republican party chairman who was a lobbyist for electric power companies, sent a memorandum to Vice President Dick Cheney laying down a challenge.

"The question is whether environmental policy still prevails over energy policy with Bush-Cheney, as it did with Clinton-Gore," Mr. Barbour wrote, and called for measures to show that environmental concerns would no longer "trump good energy policy."

Mr. Barbour's memo was an opening shot in a two-year fight inside the Bush administration for dominance between environmental protection and energy production on clean air policy....

265,000 dropped from the household survey? Where will I get my manicures? Damn it!

The employment gains of Bill Clinton's years, especially for minority workers, are being sadly eroded.

http://www.epinet.org/content.cfm/webfeatures_econindicators_jobspict

For minorities, the declines in participation rates are much larger: down 2.7 points for Hispanics and 2.6 points for African-Americans, with African-American men exhibiting a decline of -3.2 points. Interestingly, participation rate declines are larger for the more highly educated, underscoring the difficult job market for college graduates.

Ammunition of course can be used for shooting himself in the foot!

Check out the cool comic for today on the California democratic party site, http://www.cadem.org/site/pp.asp?c=fvLRK7O3E&b=36131

Patrick R. Sullivan is exactly right: jobs are a cost for the business that incurs them. Anyone who works for one of the giant companies has to realize this, and understand that the moment that the company can replace you with a machine or a Chinese worker, it will.

Companies hate costs with a passion. If you are a cost, the company hates you. Every day when you wake up, you should ask yourself one question: how can I get more money out of these pigs? That is the question all of the not-bright people are asking.

The second question is, what is my back up plan for when they fire me?

Totally off-topic: Renee Fleming is singing Violetta in the Metropolitan Opera matinee production of La Traviata. What a pleasure! My really good speakers do not do justice to this glory.

"jobs are a cost for the business that incurs them."

Jobs are not a cost. Salaries are. A job is a manifestation that in the company's estimation you create more value for them than you consume.

Dubya's new campaign slogan:

"George W. Bush: Cutting 'costs' since 2001"

"jobs are a cost for the business that incurs them."
Pleeze Patri8ck Sullivan sign up for an intro economics course at your local community college. Profit maximizing firms hire labor AND capital based on the price they recieve for their product and the marginal product of the labor. They pay people a thing called a wage to produce their product. This wage is the price of labor and thus represents a cost to the firm and a "benefit" to the worker for the "disutility" of work. Likewise "interest" represents the price of capital and represents a cost to the firm and a "benefit" to person who provides it. The units of capital and labor the firm uses are "inputs" meaning resources the firm uses to produce something for profit.

And it boggles the mind to contemplate what Patric S. and some others here would do to a concept as complicated as the "circular flow of goods and services."

By the way the "Fair" model is k9ind of a dated forecasting tool re the national economy too.

Patrick Sullivan has brought up Ray Fair again. As to why this is some sort of rebuttal to the main point of this thread is unclear at this time.

Ray Fair's analysis is basically a curve fitting exercise. You can look up his web site and see his variables and equations. Every election he tends to update his numbers to get it to fit the data better. Just to point out, the only way that he is able to get his numbers to fit the elections so far is to give the Republicans an automatic advantage from the get-go.

That, and the only time his cooked numbers have been way wrong were on Bush the elder's election. So what you have is a guy trying to fit a very limited amount of data into some equations and cooking the initial values to try to get the best fit. He sometimes is right, but clearly has been very wrong as well at other times.

Sorry, I am getting tangential. How again does this relate to the fact that the NYT makes misleading headlines?

Because it shows that there is an economic demand for right wing propaganda out there, and the NYT is simply filling that demand.

Because it shows that there is an economic demand for right wing propaganda out there, and the NYT is simply filling that demand.

"Ray Fair's model predicted Bush's father would win a second term, too. That didn't happen. His models fail to take into account the economic indicators that the majority of middle-class Americans actually care about: jobs and median income."

Posted by: Firebug on March 6, 2004 09:58 AM

Bad, bad Firebug - you just went and put some missing truth back into pool ol' Patrick's post. He left that part in the trash bucket for a reason, you know.

Bad, bad Firebug - here's a donut.

I think this highlights a phenomena that I've notice in both the WaPo and the Times. That is, they are actually two newspapers. They are one paper for those who skim the headlines and entirely different papers for those who actually read the articles. Very strange. Particularly the web versions. I know that I begin many mornings scanning the headlines in both of these papers and I get an entirely different perception of what is going on, before I go back later and actually read the pieces. Some folks never do go back. I am begining to think this is calculated.

I recall when Andy Rooney gave Dubya a pretty good fleecing on 60 Minutes one week and miraculously the following week he was back eating humble pie telling us how Dubya really was a terrific guy with the best of intentions. The long arm of the Bush administration seems to have a way of influencing the major media outlets and apparently the NYT is falling into place.

As an aside, Patrick Sullivan's prate is superfluous since we already have it on good authority, God, via a direct link with Pat Robertson, that it's Bush by a landslide.

Hillary has an interesting speech on jobs:

http://www.americanprogress.org/site/pp.asp?c=biJRJ8OVF&b=35989

"What I regret deeply in the current climate, in this administration, is the air of fatalism, of defeatism, that I hear all too often. It is one thing to say outsourcing is a good thing, which I don't agree with, and I believe Mr. Mankiw was appropriately criticized for — it's another thing to have no ideas, to come with no new strategies. The only idea — and I don't think it can be called a strategy — that we've heard from this president is to create a position in the Department of Commerce, which has yet to be filled, so it was merely a line in a speech on Labor Day.  It wasn't an idea, it wasn't a strategy, and it wasn't even serious."

Bernstein and Mishel argue that presidents can have an impact on job creation:

http://www.prospect.org/webfeatures/2004/03/bernstein-j-03-05.html

Patrick,

You want prediction rules?

The taller guy generally wins.

Bye-bye little Bush.

Lower down in the story there's a spokesman saying Bush has provided "steady leadership..."

Steady? The man is visibly a squinty-eyed rabbitty-faced freak.

Now, now David let's not dip into that gutter. We don't need the animal rights people on our case about insulting their rabbits.

Ah, I figured it out. The "two sides" who have had ammunition provided would be Kerry's side and Nader's side.

Now Republicans want it that Senator Kerry flip-flops a lot, and also that he is an automatic liberal.

Can anybody in our benighted press point out that these two slurs are mutually incompatible?

Straying slightly OT...

A bit of help needed here, please. It would seem that as soon as the addition of the word "Augmented" was added to the unemployment numbers, the ire of many increased knowing that true unemployment figures range much hire than the standard stats would infer.
But immediately others began the chant "But Clinton used the same method of determining unemployment numbers!" I am wondering (imagining that any 'augmented' figure added to Clinton's statistics would amount to little) if anyone could tell me what (or how i could determine myself) the true unemployment rates were during the Clinton years?

Thank you in advance for any insight you might provide.
(Prof., I hope you will chime in here).

" 'Patrick R. Sullivan is exactly right: jobs are a cost for the business that incurs them.....'

" Posted by masaccio at March 6, 2004 12:29 PM"

To which Lawrence replies:

" 'jobs are a cost for the business that incurs them.'
" Pleeze Patri8ck Sullivan sign up for an intro economics course at your local community college."

Which is about the level of reading comprehension he displayed last summer before he took his extended vacation at the beach when he realized that Ann Coulter was right about Harry Truman and Joe Stalin. And I fear for the U of Hawaii undergrads' future, with the intellectual confusion shown in Lawrence's little lesson.

To disperse a little of the dense fog sitting here; masaccio has misunderstood the rather elementary point I was making (I suppose I should have known better). Jobs are a COST to the holder of the job as well as a cost to the business that provides them.

That a professional economist wouldn't grasp that, even while using the phrase " 'disutility' of work", makes me doubt his qualifications to teach at even a community college. Those of us who don't teach, but do create jobs, are quite aware of the difference between the BENEFITS of income and production, and their costs.

That is to say, that the incentives facing economic actors are to minimize the costs and maximize the benefits. And it is the BENEFITS that have lately been increasing. You can verify this by taking a trip to your local shopping mall.

" By the way the 'Fair' model is k9ind of a dated forecasting tool re the national economy too."

Since the Fair model was the most accurate predictor of the 2000 election (even better than the polls taken in the final week), and from last October:

" The predicted growth rates for the next four quarters are 4.1, 3.6, 3.5, and 3.4 percent, respectively. The unemployment rate is predicted to fall to 5.6 percent by the middle of 2004."

I'd say that Fair's pudding has been eaten, and digested.

For those who are leaning on the thin reed of the model's failure to predict the 1992 election, there are two things absent today that were present then: a primary challenge to Geo W, and a billionaire self-financing a third party bid.

Patrick (referring to himself):

"Which is about the level of reading comprehension he displayed last summer before he took his extended vacation at the beach when he realized that Ann Coulter was right about Harry Truman and Joe Stalin."

The man is a parody of the right, isn't he?

A man whose intellectual superiors are Ann Coulter and Matt Drudge! Never thought I would see the day. Having much success with those rumors, Mr. Sullivan? What a sad, pathetic life you must lead that lets you spend a Sunday afternoon posting scurrilous rumors all over the internet. I guess blinkered, ideological hacks have their own motivation to drive them along.

"I think this highlights a phenomena that I've notice in both the WaPo and the Times. That is, they are actually two newspapers. They are one paper for those who skim the headlines and entirely different papers for those who actually read the articles. "

NYT has gone Straussian.

Well, Barry and strawman, in this case it was Lawrence who was the intellectual inferior of Coulter. The point at issue was factual; had Truman sent a letter to Stalin in 1946 inviting him to come to Fulton, Missouri and refute Churchill's Iron Curtain speech.

Lawrence vociferously denied it, claimed to know of 1,400 books written about Truman and none mentioned a word of this. That Coulter had simply made it up. But, in fact, I easily found several references to it. Including one by the man who personally delivered the letter, Amb. Walter Bedell Smith.

Lawrence, to this day, refuses to admit he was wrong and Coulter was correct.

Shall I teach you how to know something? Realize you know it when you know it, and realize you don't know it when you don't.

Mediocrity knows nothing higher than itself, but talent instantly recognizes genius.

People are exponentially funnier when they're in rant mode.

There is no great genius without some touch of madness.

An unimportant door is never locked.

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