Economic activity actually *declined* in December. That's right, during the heart of the Christmas shopping season, a season when economic activity usually goes *up*, it instead *fell*. It is clear that we're about to double-dip and go deeper into recession. So what is President Hoover II's response in his State of the Union Address? Well, basically... to maintain the status quo. I.e., do NOTHING of any economic value.
The small tax cuts he mentioned will do nothing to get people employed and therefore spending again. The "spending freeze" he mentioned will do nothing to get people employed and thus spending again. Furthermore, labor force participation right now is at its lowest level since 1982. (also see official BLS numbers). That is, real unemployment+underemployment (as vs. the bogus adjusted number) is probably around 20%. And we're still losing hundreds of thousands of jobs per month. That is the "status quo" that President Hoover II wants to maintain?!
To say that I am disappointed is an understatement. I know that lawyers do not understand economics. I had hoped, however, that he was an intelligent enough man to, like Bill Clinton, consult enough economists outside the Washington bubble to have an economic policy that made some kind of sense. Sadly, that does not appear to be the case. I suspect, for example, that people like Paul Krugman, Brad DeLong, Joseph Stiglitz, or any number of other excellent economists who could have steered President Hoover II straight have never gotten a single call from the man. He has disappeared into the Washington Bubble where “conventional thinking” (i.e., thinking by cretins, for consumption by cretins) is all that counts, and we’re all going to pay the price for that.
-- Badtux the Economics Penguin
And yet the headlines on the telescreen news meeja are all about the "5.7 annualized growth rate" the U.S. economy showed in the 4th Quarter 2009. I read stuff in the contrarian econoblogs, and I see the propagandaspin blaring from the screen, and my brain whipsaws from the cognitive dissonance. That's one bad thing about being back in North America and being exposed to the TV NewsLies. It's sick, the bullshit that's being fed to the people who are only paying partial attention. Ignorance is strength, y'all.
ReplyDeleteAh yes, I read that too. Lies, damned lies, and statistics spun to lie. Go over to Calculated Risk. The majority of that "growth" was in November to stores laying in inventory to sell for the Christmas shopping season... a shopping season that turned out to be a disaster. But inventory growth is not economic growth. But what the hey, why tell the truth when you can spin a plausible lie, eh?
ReplyDelete- Badtux the Cynical Penguin