Tuesday, February 16, 2010

The Road to Recovery

I just received a mass e-mail from David Plouffe, the organizing genius behind the Obama 2008 campaign. The e-mail includes the above chart, contrasting job loss rates between the Bush and Obama administrations. The Obama supporter in me wants to say: “Haha! See that? Buck Fush. Obama’s come to save the day.” But my inner skeptic sings a different tune. The chart does an effective job in mirroring Bush from Obama (or vice versa), with the message being: A) Bush = bad; Obama = good, B) Bush = down; Obama = up. Right? But that’s kind of misleading. Could it not be that the exorbitant job loss rates at the end of 2008 until the beginning of 2009 were simply the absolute zenith? Would we imagine job loss to have ever been over 1,000,000 per month? Unlikely (but what do I know). Bottom line: While this chart is reassuring in presenting dwindling job loss rates, it’s safe to be skeptical until job loss is reversed (i.e. when we’re talking about job growth, not job loss). Just my two cents.


  1. I've got to agree with your skepticism but you can't refute the validity of the chart (assuming the numbers are legit)..

  2. It's an interesting attempt at intertwining politics with economics, but it in no way has anything to do with either President's successes or failures and seems to me to be a form of Obamaganda (ya like that one, eh?).

    A lil' lesson in Econ 101: When a recession begins, job losses occur due to mostly economic factors including decreased demand for goods, which lead to lower profits, etc which cause cyclical unemployment. The current recession is THE worst U.S. labor market losses in the past 40 years, as depicted by this NY Times chart:


    Now, the question here is - Does this chart reflect Obama's effort OR the usual course of a business cycle? That's open to debate, although I lean toward the latter.

    An interesting comparison would be between private sector jobs vs government jobs, where you'd actually see that the private sector shed an insane amount over the 2-year period while the public sector actually had job GROWTH.. You HAVE to take that into consideration when talking about the labor market - the trend during this recession is private sector contracts, public sector expands. That undoubtedly skews this chart in favor of Obama's policies.

    I'll stop there, bc I don't even want to get started comparing average private salaries vs average public salaries. Let's just say that if you work for the gov't, you're pretty much set.. Another topic for another day.

    For more insight on that topic, peep:



    It will be interesting to see when we get back to 2007's level of employment, which some economists predict won't happen for SIX years or more.. Yikes.

    Peace I!

  3. I think the graph does a great job explaining a problem in perception..

    Many people in America are tying their apprehensions about the economy to Obama..

    The reality is that things have gotten MUCH BETTER under Barry..

    There is a lot way to go but we are making PROGRESS..

    I'm not sold on the health care debate but I agree with Obama on 90% of issues.. And it really seems to me like the people who supported him during the election are turning their backs on him now..

  4. @Enlight: Re: your last point. Yes, it does seem like that. But in many ways, the flipside could be argued as well. Obama has gone back on many relatively simple promises in the hopes of pleasing the right-wing (i.e. people who didn't vote for him and will NEVER vote for him again).

  5. This is looking at one indicator of one of the many aspects of the economy, the labor market. And this particular indicator hasn't "gotten MUCH BETTER" .. It has gotten much less worse. It STILL isn't positive.

    What about the budget deficit? How's he going to pay for that? .. Oh, by TAXING THE SHIT OUT OF THE COUNTRY. And if you've ever studied even one Econ text or study in your life, you'd know that taxation is a disincentive to work (income tax) and invest (capital gains tax) and even consume (state sales tax). How will that help us gain long-term economic stability and then, eventually, growth? Hint: It won't.

    I support Obama on many fronts, but his economic policies are suspect at best. The gov't needs to cut their damn spending spree before you, me and Ivan are paying for it the rest of our lives.

  6. Echoing what I said, related to this front, Obama promised to "create 3.5 million jobs."

    And where do we stand?

    129 million jobs, WELL short of the 138 million that he "promised."

    It's not that he doesn't care, he and his admin just doesn't know that Keynesian economics (huge spending to get the economy out of a recession) does NOT work because the government is a very small portion of what makes up aggregate demand, which leads to consumption that leads to GDP growth.

    The PRIVATE sector drives economic growth, the government throwing borrowed dollars at a recessionary economy DOES NOT. Create incentives for the private sector, that's the real way to get our economy moving again.. I hope someone has the foresight and strength to do this, but I don't see it happening any time soon.

  7. I think what a lot of politicians, economists and Obama's cronies fail to realize and probably DON'T WANT to acknowledge is that America needed a HUGE drastic wake up call and it got one. Things; economy, job market, housing market etc. desperately NEEDED to be shrunken down to a more realistic situation. Because clearly it COULD NOT have continued the way it was going in the 'mythical before time' pre-2008.

    In other words, a lot of those jobs won't be coming back. A lot of those unemployed people won't be returning to the job market in their previous capacity, REAL ESTATE, probably the MOST CRUCIAL factor of all that contributed to the melto down, NEEDED a HUUUGE reality check in terms of realistic pricing for houses and land in general.

    EVERYTHING needed to be scaled down and brought back down to earth in order for America to continue to function, and as it is it's struggling to function. But that can be mostly blamed on the antiquate, out-dated political systems that have been in place since day one of this country's forming.

    My advice is to embrace a slimmer America, one in which less people are employed, less people buy and consume and real estate is made more REAL and not some fucking dream land.

  8. Furthermore, salaries had not kept up with the price of everyday items, big ticket items and homes.

    You can't simply jack everything up in a feverish sickness of greed and expect everything to fall into place for you making you a billionaire. Doesn't work like that.

    First of all, America needed to return to actually PRODUCING products, quality items sold around the world. We need to be an importing, not an exporting.

    Second, the amount of money people make while working needed to and still needs to go UP.

    Third, bring our men and women soldiers back from Iraq and Afghanistan(and Germany and a multitude of other foreign lands) and call it a fucking day already! Save all those zillions of dollars and pour it back into AMERICA.

    If there's any where that needs rebuilding it's America, not Iraq or Afghanistan.

    Just because this country doesn't look like some war-torn mess in most neighborhoods doesn't mean we are constantly fighint a war.


  9. @ Ivan: I can't think of any cases where that is true.. Afghanistan maybe? I was for it.. So that doesn't really count IMO.. Maybe FISA.. Not exactly sure what you mean here..

    @ DOM: You don't own Economics.. Stop acting like you're a damn Harvard educated Economist.. I'm probably more qualified than you are to discuss Economics and I disagree with you on several points..

    "What about the budget deficit? How's he going to pay for that? .. Oh, by TAXING THE SHIT OUT OF THE COUNTRY. And if you've ever studied even one Econ text or study in your life, you'd know that taxation is a disincentive to work"

    First of all.. He has NEVER INSTITUTED A TAX INCREASE.. EVER.. FOR ANY TAX BRACKET.. EVER !! So, come on.. Get real.. Do you really think that it is politically smart to tax the lower or middle class? Do you think it is economically smart? NO.. Will Obama do it ?? NO.. He has never suggested it, never supported it.. NEVER NEVER NEVER.. Get real..

    Now, taxing the upper tax brackets.. Yes, that makes economic and political sense.. Did you know that during Eisenhower's presidency the top tax rate was 68%.. Right now it's 38%.. They can stand to take a little hit bro..

    The biggest problem in this country is economic polarity.. The top 1% of country owns more wealth than the bottom 99%.. The rich are too rich and the poor are too many..

    And don't even get me started on the Supreme Court case "Citizens United".. The GOP would have corporations running for open election if it weren't for Obama..

    Face the facts.. You're drinking the right wing Kool-Aid and loving it..

  10. @Enlight: Shutting down Guantanamo (simple executive order). Repealing don't ask don't tell (still waiting) (simple executive order).

  11. I agree with you on both.. I'd like to see them both happen.. He's played lip service to them but hasn't done either one.. YET