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"The economic effects of Bush’s presidency are more insidious than those of Hoover, harder to reverse, and likely to be longer-lasting." So argues Joseph Stiglitz in Vanity Fair, citing
"a tax code that has become hideously biased in favor of the rich; a national debt that will probably have grown 70 percent by the time this president leaves Washington; a swelling cascade of mortgage defaults; a record near-$850 billion trade deficit; oil prices that are higher than they have ever been; and a dollar so weak that for an American to buy a cup of coffee in London or Paris -- or even the Yukon -- becomes a venture in high finance.
"And it gets worse. After almost seven years of this president, the United States is less prepared than ever to face the future. We have not been educating enough engineers and scientists, people with the skills we will need to compete with China and India. We have not been investing in the kinds of basic research that made us the technological powerhouse of the late 20th century. And although the president now understands -- or so he says -- that we must begin to wean ourselves from oil and coal, we have on his watch become more deeply dependent on both."
Economist Tyler Cowen at Marginal Revolution makes a characteristically even-tempered argument the other way on some of the points in the first paragraph. He doesn't address the second paragraph.
I myself am puzzled why Stiglitz complains about high oil prices, when that is the surest way for us to get weaned from this fuel. The real problem is they're not high enough. We can't expect politicians to tell the truth about this, but economists should.
and otherwise. Recently updated blogs are in bold text.
However, I do agree with him on the point about science investment. Earmarks in the name of science are not working. We need a real program of basic research coupled with solid high school sciences for long term growth. The hysterics of Stiglitz harping make this point hard to fetch from his partisan rant.
JBP
And not that Dubya deserves much of the credit for it, but it is strikingly odd how progressives so willfully ignore long-term economic successes which are so deeply progressive in impact: low inflation and low basic unemployment.
The benefits of the strong stock market of course are distributed far more at the upper end of the spectrum, but even in that case we've seen hugely beneficial change: about half of all American households now own stocks directly or indirectly, a degree of democratization which the original Progressives only dreamed of.
And there is a counterargument about the science/math education issue:
http://www.businessweek.com/smallbiz/content/oct20...
economic success?
I see some whitewashing of the national debt problem as well. $9 trillion dollars, gentlemen, read it and weep - I know my children and grandchildren will be.
Here's some good food for thought:
http://www.faculty.fairfield.edu/faculty/hodgson/C...
http://www.levy.org/pubs/wp_502.pdf
The promise that the tax cuts and the increase in the deficit would stimulate the economy has turned out to be a real joke.
Also, deregulation of the mortgage lenders has caused the subprime loan debacle. Didn't we learn anything from the S&L crisis that Reagan set up by his deregulating? No, we didn't - we never learn anything.
Doesn't it seem odd to you that unemployment is lower now than during the late 90s, when we saw McDonald's entry level employees making $14/hour and applications for Unemployment Compensation were around 150,000 per week instead of the 300,000 per week NOW?
These kinds of things should make you go "WHAT?".
When Bush took over the Dow Jones was at 10578. The Dow Jones closed at 13276 today. A 30% rise is not "up exactly ZERO%". A huge telecoms and internet bubble has been burst, and the economy thrives.
The complete fabrication of negative economic implications of the Bush era makes me suspect of any other junior college level analytics conjured up by Vanity Fair and Stiglitz.
JBP
S&P 500 today = 1470
Do you have trouble reading?
And that's a 25% increase in the Dow over 6 1/2 years - that's less than 4% per year gain in the Dow, which is about HALF of the historical annual rate. And that poor showing is while doubling the debt.
The Bush supporters want you to BELIEVE that everything is great, but facts are facts.
Although, it has been an OUTSTANDING 6 1/2 years for the wealthy, so maybe that's what they mean by a great economy - it's a great economy for the wealthy.
Remember last December, when all the financial firms gave out millions of dollars in bonuses? Now that bubble has burst and we're looking at a pretty big downslide coming up, and with better paying jobs being lost and the national debt rising and the never-ending debacle that is Iraq costing billions per month, I think your "faith" in Bush should be wavering.
That is what you get nowadays from Right and Left in response to any piece of good news which they wish was not taking place because it contradicts their treasured worldviews. Point out to a conservative that teen pregnancy rates have been dropping in this country for a generation now and she will sputter, "Well kids having sex is still a worry!" Tell a liberal that inflation hasn't for 25 years now reached even half the peak it hit during the Carter years and he will frown and insist that "inflation is still a worry."
When someone beats cancer, recurrence is still "a worry" -- duh. And his or her spouse will and should continue to worry about it, double duh. Those truths have zippo to do with the fact that somebody's health and life just got a whole lot better, nor does celebrating that achievement represent denial of the need to remain sensibly vigilant.
It feels almost silly to state out loud such logic which is blindingly-obvious to most 2nd-graders, but that's what our "adult" political discourse has fallen to nowadays.
Since the economic statistics stand up very well for Bush (and the whole US economy for 16 years or so..broad home ownership and shareholdings, tolerable environment for risk taking etc), I think the partisan fabulists need to come up with another bogeyman.
JBP
As I pointed out, over the past 6 1/2 years, the DJIA has gone up only 4% per year, half of the historical average and with the biggest increase in debt EVER to help it out.
Yes, $14/hr at McDonald's in Boston in 1999 - the job market was THAT tight - they were importing people from Maine!
I didn't know we were comparing inflation rates from the Carter era to now. I thought he was saying inflation was "beaten". The way things are going right now, we have a better chance of Carter/Ford/Nixon era economics than Clinton era. Geez, at least when Reagan wildly increased the debt, the economy responded.
JBP
maybe on average, but necessities like groceries & heat seem to be increasing.
Just my anecdotal evidence here (I searched online, but these kinds of stats seem to be hotly debated and are very general), but as I haven't really gained any weight in a while yet I'd have to think the jumps in my grocery bill are from inflation, not more food.
Hahahaha!
Harold: I didn't know you supported Clinton's impeachment. In Oak Park at that time I said out loud simply that I could see the argument for impeachment and that he was clearly guilty enough for it, and for a few months there I might as well have been publicly advocating genocide. (I ended up concluding that his removal from office would have been worse for the nation as a whole than his being let off the hook.)
When .3% is regarded as a surge, I think inflation is beaten.
For the record, I was against impeaching Clinton. Waste of time and resources. There are a lot of lawbreakers out there.
JBP
speaking of budget decisions, did we really get, what, $60 million when all said and done, worth of satisfaction out of the Ken Starr witch hunt?
We could really have used that money for the CTA.
2) I am always puzzled by the thought that any money spent will be put to good use. Does anyone really think that the CTA would do anything sensible with more money? Perhaps more bunched trains or bus caravans?
I am always reminded of the Mayor of Rockford's special pleading for Homeland Security money, which he promptly used to provide an early retirement program for firefighters.
JBP
"if the price of cheap toxic toys from China is counterbalancing milk and heating costs going up"
...which is a point easily checkable from official data that is accessible online. So how about actually answering the question, or would that be too much trouble?
Maybe you could show us some of these "urban legend web sites" where it supposedly is posted.
That seems like a high number to mean - inflation being "beaten" may mean different things to different people, though.
JBP
$14/hour wages at a McDonald's have never been reported in either the Tribune or on any national TV news broadcast, at least not within the last 15 years. Nor has it been reported in any other major news outlet during that period. Hence no listing on any specific website is required in order to properly label it an urban legend. (Snopes after all makes no claim to be being any sort of _comprehensive_ listing of such, and this one is so obviously silly that it seems unlikely that anyone would even send it in to there.)
Does anyone think the CTA will act sensibly with *less* money? What is your evidence that by cutting the budget it will cut out waste and not essential service?
Paul, for a guy who talks about easily checking things on-line, you seem to have an aversion to it. Are you saying the price of milk, gas, housing costs, medicine and heating fuel has gone down?
Well, prove it. I'm not the one stating that holding the line on average inflation is universally good, remember? I know how much my bills are going up, and getting cheaper plastic lawn chairs at Wal Mart or even cheaper DVD players doesn't counterbalance that, as I can live without those items.
The CPI came out during these posts, see above. Inflation is at 3.5%. The CPI is a broad measure.
With regard to the CTA, I agree, no one knows what the CTA will do with the money they get. They could tear down more historic buildings in DePaul, they could build more on Block 37, they could start an early retirement program...and least likely of all, they could start professionally running the transport system.
Having consensus that CTA management is irrational is not a very good reason to give them more money. Sort of like buying more drinks for a problem gambler.
JBP
regarding average inflation, it's as meaningful to me as the average temperature of the United States on any given day.
How do you propose to measure it?
If someone at the Fed, Treasury Department etc is actually trying to manage inflation, there must be some metric other than your gut feelings.
JBP
Again, seeing the cost of disposable plastic junk from Wal mart come down is little solace for those seeing their health insurance costs skyrocket. Or are you suggesting increases of medical costs, fuel, etc are simply a gut feeling I have?
my property taxes - with the alleged 7% solution restored - just went up 36% from 3 years ago, more than a bit higher than 3.5% a year, wouldn't you say?
More importantly, that's not something I can choose to not pay, I don't pay the taxes, I lose my house.
So let's distinguish between esentials, and the rest.
People measure such things, and the rates are published. The arithmetic for computing averages is pretty well defined. Yup, property taxes are up, but the price of computers, for example, is actually down.
I think if you look around, those things where there is a some form of government enforced monopoly, such as property taxes (or gasoline for that matter), suffer a higher rate of inflation than products in the marketplace, such as DVD players.
JBP
Computers aren't an essential (you can use one for free at your local public library).
Food is. In fact, the Tribune's business section yesterday had a blurb on the front stating that dairy costs were up far, far higher than the cost of inflation this year. They don't have it on their web site so I don't want to misquote, but milk and eggs were mentioned with astronomical inflation increases (one of the products was literally up 40%+).
If you are either unable or unwilling to back up such assertions then they are properly assumed to be nonsense. On these two particular points I have gone beyond assuming and checked that they both are, but feel no need or obligation to reward your rudeness here by providing links which would take any educated person 3 minutes to find on their own.
So maybe Dairy is up, but PopTarts are down. Overall the number for food and beverages is 4.6% as of September.
Here is how to calculate an average, or arithmetic mean
average = (x1+x2+....xN)/N
You can use any junior high level arithmetic textbook to get more details on how to calculate averages.
Hope this helps!
JBP
YOU asserted that it was an urban legend showing up in blog posts and have yet to show it anywhere on the internet.
That's what I'm complaining about.
You guys go and feast on those pop tarts and enjoy the lead-tainted fruits of your "free economy," the rest of us will find a way to work around you.
Moon - might as well give up, these guys have yet to do any critical thinking and pretty much just spew a party line on every topic that comes their way.
http://www.chicagotribune.com/business/chi-mon_top...
3. No thanks for food costs
As Americans prepare to join in celebrating Thanksgiving on Thursday, food prices are up about 4.4 percent, year over year. "Dairy prices are up 15 percent from last year, and that's fairly noticeable because a lot of people buy milk every week. Eggs are up 45 percent," says economist Corinne Alexander of Purdue University.
Unfortunately, there's almost no one who doesn't need food and energy.
JBP
You asked for some backup, I provided it, but to address the larger issue, no, 4.6% inflation when people aren't getting more than a 3% cost-of-living raise (and while property taxes are going 10%+ annually) is not sustainable.
Would you like some basic math to show you how this plays out in the long run?
http://www.cleveland.com/news/plaindealer/index.ss...
2) When people show up at Wal-Mart to look for a job, it means they want to work at the wage offered by Wal-Mart, despite the best efforts of Sen Obama and Edwards to keep people away from discount stores.
JBP
When 6,000 people show up to interview at Wal Mart for 300 jobs, it means - and this is pretty basic, stick with me here - 5,700 people are walking away without a basic, service-economy job.
Ever worked in the service economy, John, and/or for tips? A 3% raise is far from the norm - I'm 36, and most people I know these days, big companies, little companies, wherever, are happy if they get ANY raise, thanks to the tremendous pressure coming from Wall St. (and lord knows those CEOs aren't taking a cut).
But please, check out this site called "Google.com" and see if you can find some hard data that isn't so broad as to be worthless (ie the global warming deniers who rant about how a 2 degree increase in temperature is barely anything, even though that increase varies widely and even a degree has been shown to cause massive problems).
You're in over your head, old boy.
http://www.washingtonpost.com/wp-dyn/content/artic...
Signs Are Pointing South on Wall St. Credit Woes Foster Bets on Bad Times
By Neil Irwin
Washington Post Staff Writer
Tuesday, November 27, 2007; A01
Wall Street is betting on a recession.
Investors in stocks and bonds are paying prices that indicate they believe a snowballing housing crisis and worsening credit crunch will soon tip the U.S. economy into a recession, analysts said. Many economists, including leaders of the Federal Reserve, don't think things will get that bad, but some say the risk of a serious downturn has risen in recent weeks.
Grade school level arithmetic I have got down pat. I assure you I am not over my head in being able to compute an arithmetic mean.
At some point, you might realize that some numbers are higher than others, without any sinister plot from the Bush administration.
JBP
Here's another piece of info to chew on, I'll leave it up to you to decide whether Bush running up our national debt was a sinister plot, or just a case of recklessly ignorant budgetary policy. Bush will be long gone while this damage to our currency is still being felt:
http://www.tpmcafe.com/blog/coffeehouse/2007/nov/2...
Put simply, a new administration faces two choices: Accept the fact that the U.S. dollar is a declining currency, which means accepting the reality that all imports, including oil , will become more and more expensive. Or, raise interest rates---which will make the dollar more attractive to foreign investors who buy our Treasuries. But higher rates also will make it that much harder both for U.S. consumers and for the government to pay off the heap of debt that has been keeping this country afloat.
Stepping back and surveying what has happened both at home and abroad in recent years, some observers doubt that the dollar will ever recover: “For the first time,” Bloomberg reports, “economists are raising the once-improbable specter that the dollar's monopoly as the world's dominant reserve currency is under threat. "'Part of the depreciation is permanent,’ Harvard University professor Kenneth Froot, who has been a consultant to the Fed, told Bloomberg: `There is no doubt that the dollar must sink against periphery currencies to reflect their increase in competitiveness and productivity.’''