In another piece of good economic news, new unemployment claims, a week-on-week measure, have dropped to the lowest level in four years. The Wall Street Journal reports:
Initial unemployment claims dropped by 13,000 to 348,000 in the week ended Feb. 11, the Labor Department said Thursday in its weekly report. The previous week’s figures were revised up, to 361,000 from 358,000. Economists surveyed by Dow Jones Newswires had expected claims to climb by 7,000 to 365,000.
The decrease was the third in a row and carried new claims to their lowest since the week ending March 8, 2008. It gave another signal that the labor market is healing. Earlier this month, the Labor Department reported non-farm payrolls climbed by 243,000 jobs in January, the biggest gain in nine months.
The Obama administration will surely claim this as more evidence of a well-executed economic turnaround, thanks to their stimulus spending, but there’s another interesting news bit today, from a new book by Noam Scheiber of The New Republic, about the government’s response to the financial crisis. Apparently, the head of President Obama’s Council of Economic Advisers, Christina Romer, initially suggested a $1.8 trillion stimulus, based on the Keynesian calculations of how much government spending was necessary to fill the economy’s “output gap.” Larry Summers, then in charge of the National Economic Council (which is meant to translate economic thought into useful policy for the president), rejected it as politically unfeasible, so she came back with $1.2 trillion, which was also rejected, before it even got to the president. More here.
In addition to the people who've given up looking, isn't this number at some point affected by a kind of "saturation"? There are so many people collecting unemployment for so long that there aren't as many people left to start claiming? And if unemployment benefits didn't last two years, wouldn't some of these people have been more likely to take SOMETHING and then later perhaps end up starting unemployment again?
It seems that there are many factors that artificially make this number lower whether the actual employment situation is improving or not.
Reply to this commentLinkReport Abuse"The Obama administration will surely claim this as more evidence of a well-executed economic turnaround, thanks to their stimulus spending, but "
Nothing after "but" contradicts anything before it. The president will take credit for the turnaround, BUT his advisors debated a larger stimulus? Where is the contradiction?
This is written to appeal to people who don't read things carefully, but want to know that the economic recovery can't be attributed to President Obama. It's like a Mad Libs blog post.
Reply to this commentLinkReport AbuseSorry Jason, the chronology doesn't work for you here.
The consensus among economists was the recession would trough around mid-2009, with or without "stimulus." Almost NO stimulus funds had been put into circulation by June of 2009, the official beginning of recovery. The ensuring 2 years was tepid, and inexcusably subpar compared to historical GDP and employment growth rates typical for recoveries off of other contractions that severe. And by spring of 2011, the liberal brain trust was openly fretting that clearly the package hadn't been large enough, since we had stalled to about 1% annualized growth. The talking point then became it was somehow the GOP's fault because of the budget/debt ceiling battles.
The economy did not start showing signs of life until very late in 2011, when ALL stimulus money had spent. How you can logically credit stimulus, and hence Obama, for the current recovery escapes me.
"Stimulus" money is being spent, pitiful growth. "Stimulus" money is all gone, we're finally seeing results. Doesn't work.
Reply to this commentLinkReport AbuseMy point is that Mr. Brennan's argument doesn't make sense on its face. Your argument does make sense on its face, but it's not the argument Mr. Brennan is making. Maybe you should be the blogger and he should be the commenter.
He is saying that Obama will take credit for the recovery, BUT his advisors debated a larger stimulus. Sorry but that doesn't follow at all, it fails logic 101.
That doesn't mean there isn't a good argument against Obama being credited for the recovery. But Mr. Brennan's argument is nonsense. And it shows he doesn't think much of his readers.
Reply to this commentLinkReport Abuse1.) Obama says this will be well-executed economic turnaround.
2.) Brennan says - ah, not really well-executed at all, and implies Obama could have screwed it up more than he did.
The point isn't taking credit, it's whether this was all well-executed.
Reply to this commentLinkReport AbuseHow on earth does "but there's another interesting bit of news today" constitute an "argument"?
Your caricature of my note that this is "interesting," "Obama will take credit for the recovery, BUT his advisors debated a larger stimulus," does not fail Logic 101; it is merely two facts.
Reply to this commentLinkReport AbuseWhere in his support for the stimulus, did Obama indicate that it would take three years before the additional spending would have any affect?
Reply to this commentLinkReport AbuseONLY 348,000 applied for unemployment? The salad days are back. We've been around 300,000+ since Obama took office. Why is this number a sign of good things? I guess it's better than 350,000, but not near good enough to where we should be with a competent administration and congress to lighten the burden on business. But thank God we got our payroll tax cut for 10 months. That'll help things.
Reply to this commentLinkReport AbuseYeah, things hit rock bottom about one day before the Republican house went into office. Since then, our "do nothing" Congress has kept the poor little Administration from doing anything, and yet, things slowly start to get better. So, we've already admitted that the Prez isn't doing anything, because we've complained that the "do nothing" Congress won't let him, and still we give him the credit for improving the economy, even though we admit he isn't doing anything because we know the the "do nothing" Congress won't ...
I'm confused.
Reply to this commentLinkReport AbuseThe stimulus was much smaller than it needed to be, because:
1. Republican obstruction and demagoguery prevented a stimulus on the necessary scale;
2. The magnitude of the recession was not accurately reflected in statistics available at the time -- things were much worse than it was thought at the time.
The result -- an insufficient stimulus and a slow recovery.
Hard to figure out Brennan's point in light of these facts.
Reply to this commentLinkReport AbuseNo, what 's hard to figure out is your stubborn, religion-like fervor in clinging to theories in an 80 year old book that have been demonstrated failures time and again, if you'll follow the chronology of federal spending and economic performance I outlined below. While the spending took place, poor performance, especially by historical standards. Now that the spending has stopped, we're starting to show some momentum. Correlation doesn't prove causation, but this is the exact opposite expected result if the concept of "stimulus" were valid.
This is to say nothing of your inability to understand your party had a lopsided majority when this legislation was produced, hence "Republican obstructionism" was a non-factor.
Reply to this commentLinkReport AbuseOh noes this good news for the country can't really be happening! I blame Clint Eastwood.
Reply to this commentLinkReport AbuseYou know, that reaction is nearly identical to how we taunted you guys in 2004 when we had positive economic data, and I'll tell you this same thing one of you correctly told me:
A recovery now that ensures Obama's (Bush's) re-election is a far worse long-term outcome for the U.S. than a delayed recovery that ensures his defeat. Hoping for the latter rather than the former is to hope for the lesser of two evils, and it's perfectly rational.
I now agree!
Reply to this commentLinkReport AbuseYou know, just because that Democrat who warned you what a failure Bush was, turned out to be right, it doesn't necessarily follow that you are right about Obama.
It's morning in America, baby.
Sorry: it's "half time" in America! How could you come from behind? Sorry, I just don't see it happening.
Reply to this commentLinkReport AbuseWhat are the unadjusted numbers like?
The seasonal adjustment adds in a couple of hundred thou to correct for the
Reply to this commentLinkReport Abuseassumption that the East Coast is under a couple of feet of snow.
The stimulus WAS too small. As a result, unemployment went higher and lasted longer than it needed to be. If the stimulus had been larger, the recovery would have been faster and stronger, and deficit fears would now be beginning to fade as tax receipts returned to more normal levels.
As it is, GOP efforts to delay the recovery didn't delay it enough to prevent Obama getting credit.
Reply to this commentLinkReport AbuseIf the stimulus had been larger, the recovery would have been faster and stronger
Prove this.
Reply to this commentLinkReport AbuseYou could start by reading the link in the post to a 2009 Krugman column where he spells it all out in advance. Then read the actual memo that the Obama economic team wrote as the Administration took office here: External Link
You can see from the memo that the consensus of economists - both Democrat and Republican - was that the stimulus needed to be higher, but the Administration made a political calculation that $700 billion was the most they could get through Congress.
When you've read those, come back and ask me about anything you didn't understand.
Reply to this commentLinkReport AbuseSeriously? This is the best you can do?
It will never be possible "prove" a counterfactual. I prefer to deal with the real-world results, which by my count I've outlined twice now on this thread for how the economy grew while stimulus dollars were being dispersed versus how it is now that stimulus is exhausted, and still haven't gotten an answer.
When it looked as it we were about to double dip a few months ago, you guys were in a near lather about how that was likely, and more spending bills were needed to sustain us. Now we seem to be hitting our stride just fine without it, some three years late after your "cure" has exhausted itself, and you have the NERVE to come on here doing an endzone dance as if you've been vindicated.
ALL economies, socialist, free market, and all points in between, recover from recessions eventually. You're simply not bright enough to understand you need to be apologizing for gumming it up so long relative to historical standards.
Reply to this commentLinkReport AbusePssst - let me help you out: linking to a gazillion page memo from 2008 and mentioning a three year old Krugman column isn't proof. It's supposition. Bad supposition, too. (I like how "evidence" for you is the embarrassingly stupid Team Obama report - unemployment rate will be 8% if we do nothing. Oh, that's right. We needed more money. But things got worse after what they did. Well, we needed more money. Trust us.)
It's never enough for you leftists, is it? Next time we'll get it right. I promise. Been hearing that song and dance since I've been paying attention to politics, which covers a fraction of the centuries of economic lessons that you people ignore. Even Keynes at the end of his life started rethinking his work.
You live in a fantasy land.
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