Unexpectedly!
Bloomberg deploys the U-word:
I’m sure all of the journalists there (with the possible exception of Amity Shlaes) are laughing sycophantically at the president’s jokes; the Blogosphere is laughing at the joke president and his palace guard media in a much more knowing fashion, as the Say Anything blog noted in May:
This end of the blogosphere has enjoyed a delicious running joke for much of Barack Obama’s presidency…the strange appearance of the word “unexpectedly” in MSM coverage of the anemic economic recovery. Of course, many of us knew that Dear Leader’s economic policies would either amount to nothing and/or inhibit economic growth even as they were being debated, so there was nothing unexpected about the result. Still, the joke has only gotten funnier (sadder?) as time has worn on and it becomes clearer and clearer that the man-who-has-never-had-a-real-job-yet-occupies-the-White-House has no clue what he is doing when it comes to the economy. (For our purposes here, we ignore the not-so-outlandish notion that perhaps he knows exactly what he is doing, but that robust economic growth, if it is the result of typical laissez-faire American capitalism, is not his goal.)
Anyway, this joke – and the point it reveals – has finally made it somewhat mainstream via the good offices of Michael Barone, who makes it the central theme of this Washington Examiner column.
Ace wonders how the New Feudalism has added to the nation’s “unexpected” economic woes.
Update: Welcome Mark Steyn readers clicking in from the Corner.
I keep saying when the same crap keeps happening over and over, it should no longer be “unexpected” unless the writer is really dense. This explains why it keeps appearing in MSM economic stories.
This persistent denseness is probably the result of global warming.
‘Unexpectedly” is a matter of successful prediction. A good cook expects a dish to come out about the same as the last five times. The physical world responds reliably to the same recipes and procedures.
Economics and people are not as predictible, so it is even more important to do what worked before, with a clear insight into the details of why it is supposed to work this time.
Against this good advice, Team Obama writes down a few simple formulas and bets $1 trillion and the health of our society that these formulas will predict the future. We should all be afraid, because these formulas are so simple that 2/3rds of the populace can understand them, and laugh at them.
The Obama Team claims that the stimulus saved 3.3 million jobs. How do they know? I can reveal their method, as presented by Christina Romer, recently retired head of the President’s Council of Economic Advisors.
Consider this analogy to the idiotic logic of our government economists.
Say that records from my backyard grill parties show that on average 20 guests eat 25 hamburgers and 5 hot dogs. I would like to be much more popular, so I double the food to 50 hamburgers and 10 hot dogs for my next party. I expect 40 people to show up without calling more friends.
After a few more parties, I find that 23 people (three more) do show up. Maybe they came because they heard about the huge amount of food. I resolve to supply even more food (stimulus) for my next parties.
Government economists are treating the entire population of the US in the same way that my example treats grill parties. You may say that I am unfairly criticizing government economists. They couldn’t be that simplistic and stupid. But, that is exactly the method they used to recommend “stimulus” and predict new jobs.
–> Romer is Theoretically Correct
The President’s Council Of Economic Advisers in May 2009 [edited]:
=== ===
To estimate the likely impact of the fiscal stimulus on real GDP, we used multipliers that we feel represent a consensus of a broad range of economists and professional forecasters.
The final step is to take the effect on GDP and translate it into job creation. Not all of the increased output reflects increased employment: some comes from increases in hours of work among employed workers and some comes from higher productivity.
We therefore use the relatively conservative rule of thumb that a 1 percent increase in GDP corresponds to an increase in employment of approximately 1 million jobs, or about three-quarters of a percent. This has been the rough correspondence over history and matches the Federal Reserve Bank model reasonably well.
=== ===
1: Measure the number of jobs in the economy at different levels of GDP. Notice the ratio 1MM jobs per 1% of GDP.
2: Spend money. Each dollar spent adds to GDP by definition.
3: Welcome the newly employed people to the economy.
This is idiocy. This is mere formula crunching. First, express the complexity of the US economy as a simple ratio. Then, play with the ratio by manipulating an accounting measure (the definition of GDP).
Of course, they do get to distribute a huge amount of money to their friends along the way. So, it isn’t all that bad for them.
Another round of negative data, another series of media spit-takes. Followed the next day by some insignificant sign of the “recovery” eveyone’s supposed to pin their hopes and dreams on (“We sold two more Chevy Volts!”)
Not only can you not tell the news from the Onion anymore, you can’t tell it from the Firesign Theatre:
“Don’t panic. Don’t take off your shoes! Jobs is on the way!”
I truly think this gang believes the response to their economic medicine is “unexpected”. Really. They listened to the highest-credentialed folks in the country and applied what all the proper-thinking economists have been saying for decades. It *should* have worked — everyone say so! As Ed is fond of saying: what could go wrong?
Expect a s**tstorm of recrimination and blame in the next 16 months that’ll make, say, Jimmy Carter’s take on this subject look like a cakewalk. There’s simply no way this administration will blame themselves or their “brilliant” advisers — why should they? They did what they were *supposed* to do; they made all their outlandish economic claims because this Keynesian garbage *had* to work.
Now everyone from the evil Republicans to the American people will be to blame. Obama & Co. have gone all in; there is simply no alternative. I humbly predict 2012 will be the most entertaining presidential election in decades.