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Grubble Grubble
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Friday, January 30, 2004 :::
Are economists becoming apologists and spin doctors for the Bush administration?
rant
Three times in the last couple of months, I have heard “leading economists” talk about how the economy is rebounding. I have heard them make predictions that have turned out to be so far off the mark that I wonder if they are getting their data straight from the White House Press Office.
The first notable prediction was the addition of 100,000 jobs by January. This was predicated on the 8.2% growth in the economy that they claimed was helping speed us towards recovery. How many jobs were added? 1,000.
That is not a typo. Zeros are not missing. One thousand. I will accept that economic prediction is not a perfect science, but I have trouble with the fact that they are off by 99,000 jobs. That is statistically significant. Only 1% of the jobs they predicted materialized. I would have been happy with even 50%.
The next section is a statement on the unemployment rate. In January, the unemployment rate fell from 6% to 5.7%. Now, as we have read above, this has nothing to do with job creation. 1,000 jobs does not a .3% reduction make.
Where did all those unemployed people go, you ask? This new unemployment rate is based on unemployed workers (a lovely contradiction in terms) “dropping out” of the job market. 330,000 of them, according to “leading economists.” In other words, 330,000 people are so dejected that they have just plain stopped looking for work. Who will pick up the welfare bill? These people did not just simply go away.
I, personally, would put the number “dropping out” at a higher level. A .3% drop in unemployment can equate to 330,000 people, but we must take into account also the loss of seasonal jobs now that the holidays are over. By all rights, unemployment should have gone up in January due to that loss, so the fact that it went down equates to more than 330,000 people giving up.
My final beef goes back to “leading economists” speaking of that 8.2% economic growth. They tout how it is the best growth we have seen in 20 years, however, you have to read to find out that our actual growth was 3.1% for 2003. 8.2% was one quarter. Of course, I question that number, but do not have the stats right now to argue it.
Our economic growth is not stable and is being fueled by a Bush administration pyramid scheme. It is tax cuts and a refinancing boom that has fueled spending which has propelled our economy for more than a year now. And that spending is beginning to cool. What will happen then?
Our economy has lost 2,300,000 jobs since Bush took office. Unemployment is at 5.7% (an artificially low estimate at best). Good luck taxing the unemployed. Further, the money to pay for the tax cuts is based on record-breaking deficit spending that is starting to deflate the dollar on the world market.
I am not a trained economist, but if this keeps up, I predict an economic depression to rival the 1929 stock market crash.
/rant
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