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I was surprised to read the Washington Post quote economist Mark Zandi this morning: "’the economy has been measurably worse than anyone expected,’ with a surprisingly sharp ‘collapse in employment and surge in unemployment.’"
This is surprising, because the economy has absolutely not been "measurably worse than anyone expected." It has been pretty much following exactly the course that some of us predicted. In addition to myself, I can think of Paul Krugman, Joe Stiglitiz and Jamie Galbraith as economists who said that the economy was sinking faster than the projections used by President Obama implied. Here is an example and here, and here.
It would be nice if some of these folks could acknowledge being wrong rather than falling back on the no one could have known story. The great thing about doing economic policy in this country is that you can be wrong every single day on everything you say and it doesn’t affect your credibility one iota.
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Thanks Prof. Baker!
snark
But, David Stockman told me that all that wealth was going to trickle down.
/snark.
Zandi is just repeating the new White House line. Biden was using it last Sunday. No one could have predicted is just a way of saying the White House, the Obama Administration, and his economic dream team didn’t. Some of us have been shouting about this since before the Inauguration.
The key question is in view of this new found perspective will there be a corresponding change in policy. So far I don’t see it. Maybe, maybe a little extra stimulus but no real rethink of the basic approach. It is why my pessimism remains pretty much intact.
Got a question. When you make a prediction and it turns out to right, how can that prediction be labeled “optimistic” or “pessimistic?”
Isn’t it time for economics to be freed from these cheap and irrelevant terms from pop psychology?
Well, per Obama economic advisor Laura Tyson, former Chair of Clinton’s Council of Economic Advisors (to the displeasure of some better economists):
That’s tantamout to admitting a slight error but one that surely can be fixed. The problem is that that slight error has blown the Administration’s economic credibility: http://www.youtube.com/watch?v=CJu0DgpiK8c
I think this is a re-write of fairly recent history.
The Administation would have liked a bigger and differently configured stimulus package. Unfortunately, this required 60 votes in the Senate.
This number necessitated the votes of Snowe and Collins. Those two, particularly Collins, would only go so far. In my view, the Administration got as much as they could.
“The great thing about doing economic policy in this country is that you can be wrong every single day on everything you say and it doesn’t affect your credibility one iota.”
…or your salary or standing with your publishers/bosses. It ain’t about getting it right, it’s about getting out the message.
The needed changes include lifting the cap on Social Security taxes, and rolling back the IRS tax code to one in place during the Eisenhower years – 91% for incomes over $400,000.
Tales from the establishment …
Now sit down and listen children and I hope you didn’t eat too much this morning becoz I’ve got a lot of bullshit to feed you.
No one foresaw the economy getting this bad, no one could have foresaw it. It was like asteroids that fell from the sky … just like 9-11 … just ask joe biden. He’s a great guy … a blue collar guy, a real American’s American … remember he pushed thru that bankruptcy bill for you so that those friendly credit card companies could keep giving you all those wonderful credit card terms and rates, You can trust him.
And no one foresaw the housing/credit bubble collapse either … or could have. Somehow all these ivy league schooled geniuses on wall street just happened to make a ton of money … by accident of course, literally dumb luck … while they were absolutely wrong and blowing up the global economy in the process. And they didn’t loot the global economy either becoz everyone on wall street … with all their teams of brilliant mathematicians … thought that housing prices were going to go up forever … and ever … and ever …
Z
Tax Cuts, more tax cuts are needed for the unemployed. Tax cuts with union busting, job outsourcing and offshore tax havens provide the best trickle down economic package.
The rich must not pay taxes. They are the thinkers and deciderers. The rich are the risk takers. They invest and create jobs (in China, India and the Ukraine).
We must abolish the entitlement programs – Social Security, Medicare and Medicaid. We must insist that no public health option gets passed.
We are not worthy.
We are all Glenn Beck Tea Bagging Libertarians now.
In Halliburton We Trust.
Just a rephrasing of Condi Rice.
Yep, it ain’t about being right, it’s about spouting the proper propaganda. That’s generally how you become a “successful” economist in this country.
Z
Another wingnut told me today that Social Security is the biggest Ponzi Scheme ever.
Which right wing blowhard told them that?
Limbaugh, O’Reilly, Hannity, Beck?
Last week, tech stocks were touted as winners.
This week, tech stocks are the worst things in the world.
Turn off the teevee. They’re totally full of shit.
Just how to the wingnuts think they’ll support themselves in their golden years? From the generosity of Limbaugh, O’Reilly, Hannity, Beck?
Of course, this is just a rhetorical question. They don’t know what they’re doing after beer-thirty this afternoon.
Business cycles happen the economy goes up and down and there is nothing a President can do to prevent it? Does anyone remember that Chessnut of Conventional Wisdom opened only when a GOPer is President.
If nothing can be done buy WE KNOW ITS GOING TO HAPPEN ANYWAY.
Then why don’t we prepare to minimize the damage. Business regulation comes to mind like restricting leverage, insisting on 10% home down payments etc.
Think of it as not building any homes in a flood zone.
Christy has a new post up on the front page: “A Tale Of Two JAGs”
And not just on economic policy either.
See Paul Krugman’s post today…
Unpersons
…for more about persons who don’t exist.
Two words: Marx, Minsky.
It’s as if they all opened their desk drawers on January 21st and found a note from their predecessors: “Here, try this, it worked for us for eight years: NO ONE COULD HAVE ANTICIPATED.”
It didn’t require 60 votes. It required a willingness to let the Republicans filibuster and tell America that they were going to block the economic recovery package of a very popular new president.
It required Democratic leaders who remember what Press Secretary Gibbs said: “We counted the votes. We won.” and who remember that this is what their constiuients want.
I can understand why the lobbyist ratted out WaPo on their pay-to-play “Salon”.
Why bribe the writers at WaPo when they churn out the talking points with out having to the grease skids.
You left our Roubini.
Sorry, but I’m all commented on – many times – on this subject. I apologise for simply referring to my post on today’s Oxdown story about Summers & Geithner:
http://oxdown.firedoglake.com/diary/6171
I just don’t want anyone think that I’m ranting again on one of my favorite topics!