Sunday, November 08, 2009

The employment numbers

Worst since WW2.

We need some bold action from Washington, or things are going to go to hell in a handbasket. Unfortunately today's Democrats have all the spine of a jellyfish, and President Obama appears to be in thrall to his Treasury Department, which is led by Wall Street insiders, and hasn't proposed anything bolder than milk and cookies for bankers. Siiiiigh!

-- Badtux the Economy Penguin


  1. I'm curious, in your opinion, is stimulus a linear function or an all-or-nothing step function? I know you argued for much more than 1 trillion. Since we only committed 1 trillion would it have been better to do nothing?

    I think if we had done *nothing* (besides TARP) the unemployment numbers would have been the same or better.

  2. Nathan, you don't think. That's the problem. You guess. You conjecture. But you don't think. Thinking requires actual study of real actual data then applying that data to models to see whether the models accurately fit the data, then using the models that best fit the data to predict outcomes based on various interventions. That's thinking. What you're doing isn't thinking, it's conjecturing, which is something else entirely.

    Economists such as Paul Krugman and Nouriel Roubini have models that have accurately predicted the course of the current recession, including the unemployment numbers. What they show is that without the stimulus, the unemployment numbers would be above 12% right now. You conjecture that this isn't so. But you do this only based on ideology, not data, thus you don't think, you conjecture.

    -- Badtux the Economics Penguin

  3. I was about to take a guess, but now I've changed my mind.

    On 2nd thought - Oh what the hell:

    It's probably a step function, but not "all or nothing." Why would the size of the step be a trillion?

    No, it would not be better to do nothing. It would be better to put the money to work, rather than have it languish as Wall St. bonuses.

    I think if we had done *nothing* (besides TARP) the unemployment numbers would have been the same or better.

    On 3rd thought, BT is right. You don't think.

    JzB the conjecturally thoughtful trombonist

  4. Like I said, I was just curious, I probably haven't kept up with all of your posts on this subject. With five kids, a day job, and other community responsibilities, I can't devote the time you can to study economics in depth. But I took a round of econ courses in college, including one that was dedicated to understanding the national debt.

    Instead of lasering in on unemployment as the lone bogeyman, I think we should look at the entire basket of problems. 1. we need to deleverage the economy and get back to saner levels of personal and savings, 2. we need to own more of our debt as a nation. Back in the 80's, our national debt had many salutary effects because 90% of the interest payments went to American citizens. Today only 72% goes to Americans. We are ceding national sovereignty little by little to countries like China. 3. the trend toward higher spending has no end in sight. Is government spending the only hammer in your tool box? 4. everyone knows the phrase "no pain no gain", so how come nobody seems to believe it? Nobody but our brave servicemen are willing to take a hit. Lost jobs, bankruptcies, and losses are nature's way of promoting healing. Balance out the tragedy of high unemployment with corresponding blessings. Blessing like belt tightening, going back to school, providing venues for humility and charity, focusing on what in important in life, *a smaller carbon foot print!*, slowing the pace of urban sprawl, and restructuring society for future sustainable growth.

    Come on people, look at this thing holistically. I don't buy that the end of the word is nigh if we don't spend 2 more trillion. Let's start taking our lumps and quit whining.

  5. Wow. You're channeling Phil Graham.

    Unemployment is not a bogeyman, it is a resultant.

    1 & 2 - OK.

    3 When you are up against a zero interest bound, the tool box is pretty empty, so, yeah. If you don't know what that means and/or why it's important, read Krugman.

    You could even go to my blog and read some of the economics posts. They're labeled.

    4 Are you totally unaware of what has happened to wealth distribution over the last 30 years, and specifically, the last 10?

    The blessing of belt tightening? Tell you what - I will not wish that blessing on you.

    Going back to school? Who's going to pay your tuition, who's going to feed you kids in the meanwhile, and what will you do when you get out?

    Not only do you not think - you don't know anything.

    I seldom pile on, and I usually save this kind of diatribe for right wing pundits, but, Jesus H. Christ in an handcart.

    The ignorance - it burns.

    JzB the losing patience trombonist

  6. Nathan regurgitates "common wisdom" (which isn't), faith-based (not fact-based) beliefs and talking points, and believes them to be facts.

    My latest post addresses his issues in more detail. Many of the things he says are repeated ad infinitum by right-wing politicians and have achieved the status of "conventional wisdom" despite being supported by not a lick of data -- the "no pain, no gain" thing being a perfect example, it isn't even true for athletic training, the arena it was stolen bodily from. But it makes a neat-o talking point, eh?

    - Badtux the Economics Penguin


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