Here’s my most recent commentary. Its kinda big, so an excerpt is here, and the full piece is below.
“Slow Job Growth Puzzles Economists.”
That was the headline of a WSJ article in March of this year, on the economy’s anemic job creation. “Many economists admit they are ‘stumped’ by the question of why the expanding U.S. economy isn’t churning out lots of new jobs, as it did so faithfully in the 1990s,” the Journal noted.
Since then, their forecasting record has gone from bad to worse. With the June shortfall now clearly not a “one-off” courtesy of July’s disappointment, one question remains: Why have so many Economists gotten it so wrong? Observers are hard pressed to recall the last time the Dismal Scientists have been so consistently inaccurate, by such a large margin, and for so long a period.
It is easy to surmise that a combination of factors is to blame for the unusually slow job growth: Productivity enhancements have delayed the need for new hires in many businesses. And, during this expansion, jobs have been outsourced overseas (which, for obvious reasons, do not show up in the Bureau of Labor Statistic’s data). Last, we cannot underestimate the impact the tech/telecom/internet crash had on suppressing end demand. So much excess capacity was created by over-investment during the bubble era, that an extended delay in job creation – “Slack in the labor market,” as Chairman Greenspan likes to call it – is the natural result.
Yet all these issues have been well known and documented long before Economists started serving up their stink bombs. Did the entire profession suddenly become unhinged – or is some other, unknown factor at work? Since most economists I know are only mildly delusional (at least, they appear that way to a non-economist) we should consider another possibility: A major factor –unaccounted for by mainstream economists — has contributed to the present recovery cycle’s unprecedented long delay in job creation.
Pick your flavor:
Word Doc: Download Economists vs. Job Creation.doc
Adobe PDF: Download Economists vs. Job Creations.pdf
click for larger chart
Chart courtesy of WSJ
Yet another fascinating poll, courtesy of WSJ. The recent SBVFT commercials seemed to have had an impact nationally, narrowing the gap between the challenger and the incumbent. According to this most recent WSJ/Zogby poll, conducted Aug. 16-21, there seems to be little impact in the Battleground States. Kerry now leads in 14 states (up from 13 early August). President Bush leads in two states.”
Here’s the Journals take on the polling data’s internals:
The contest for the White House remains tight, according to the latest Zogby Interactive poll of likely voters in 16 battleground states. Although the map is awash in blue, with President Bush leading in only two of the battleground states, down from the three states he held three weeks ago, the results in three-quarters of the states in the survey are within the margin of error — meaning those states remain very hotly contested. Mr. Kerry holds the top spot in 14 of the 16 polled states, up from 13 in the previous poll.
Mr. Bush’s lead is outside the margin of error in one state, but it’s a key one: Ohio. Only two 20th-century presidents have been elected without carrying the Buckeye State, and no Republican has won the White House without Ohio’s support since the party was founded in 1854. Mr. Kerry has top spots outside the margin in three states: Oregon, Washington and electoral-vote rich Pennsylvania.
In addition, several states continue to switch their allegiances. The survey results were closest in Florida and Missouri, where the margins between the two candidates are less than one percentage point. Both states, with their total of 38 electoral votes, have flipped between Messrs. Bush and Kerry more than once, most recently landing in the Democratic column. Similarly, the two states Mr. Bush leads in this poll, Ohio and West Virginia, have been led by both candidates at different points in the poll series. For further analysis of how these results could play out in the Electoral College, view this article
RNC in NY in one week . . .