The August jobs report shows the Obama jobs deficit at 7.5 million workers. The Obama jobs deficit is the difference between the current level of employment and the level he promised his stimulus policies would achieve at the end of 2010. The President boasted that his policies would create 3.5 million jobs, pushing total employment by December 2010 to 137.8 million. As of this report, he is 7.5 million jobs short. By his own metric, the President’s policies have failed. According to today’s jobs report, the economy lost 54,000 jobs …
The Commerce Department today revised down its estimate for second quarter gross domestic product from 2.4 percent to 1.6 percent. This is not a sign of a weakening economy but a weak economy last spring. The weakness was especially pronounced as the bulk of what growth did occur was due to a building of inventories and a temporary (and now apparently reversed) blip in home sales. Most of the data since the second quarter ended—from industrial orders to labor markets to housing—has worsened further. What we are seeing is an …
Pity the poor Congressional Budget Office (CBO) Director. Congress passes and the President signs the most massive fiscal stimulus program in history, spending more money on Keynesian stimulus than has been spent so far on the Iraq war. But, unlike the Iraq war, the stimulus has been a complete bust. Rather than launch a recovery, the stimulus managed only to launch a jump in the national debt. The economy enjoyed a mild bump late in 2009 as businesses rebuilt their inventories—a development completely unrelated to the stimulus—and then slid back …
Washington think tanks and commentators continue to spin out impressive reams attempting to explain the necessity and virtues of adding a value-added tax (VAT) on top of all the taxes the federal government already collects. The fiscal policy problem is real enough—thanks to the Obama spending surge, federal budget deficits are unsustainable and a course correction is inevitable. What most VAT-istas refuse to acknowledge is that the problem is due to new spending, not a sudden collapse in the ability of the federal tax system to raise revenues. Even so, …
Unless Congress and the President intervene legislatively, federal income taxes will soar on January 1, 2011 for millions of middle- and upper-income Americans. Tax relief enacted in 2001 and 2003 is set to expire. Whose money is this? Is it the taxpayer’s money taken by government, or government’s money left with the taxpayer as a benefit? If current policy is preserved, is it a tax cut, are tax cuts extended, or has Congress prevented a tax hike? As a recent Brookings report reveals, one’s core view of government determines how …
When economists forecast the economy, they tend to draw straight lines. They figure out where we are and where we’re going, and they plot a line. In fact, neither contractions nor expansions are ever smooth. For various anomalous reasons in the economy and in the data, reported GDP movements are jagged. The reported economy accelerates, slows down, jumps, and pauses. So one ought to hesitate before reading too much into the latest economic data. However … The recent report on second quarter growth showing a reasonably strong 2.4 percent pace …
The mainstream media is having a field day with House Minority Leader John Boehner’s (R–OH) less-than-stellar handling of a simple “when did you stop beating your wife” question posed by NBC’s David Gregory on Sunday’s Meet the Press. Gregory repeatedly badgered Boehner about how he could square the Republicans’ newfound concern over the budget deficit with an unwillingness to pay for “tax cuts,” at one point asking, “How can you be for cutting the deficit and also cutting taxes, as well, when they’re not paid for?” Boehner responded, “You can’t …
The Federal Reserve’s Open Market Committee meets today in the face of tremendous economic uncertainty. In light of last week’s dismal jobs report and related evidence of a faltering recovery, markets are looking for signs as to what the Fed might say and do. It’s widely expected that the Fed will downgrade its near-term outlook for the economy and will suggest some actions it might take if a severe downturn materialized. While the attention given to the jobs picture is understandable, some disturbing issues surrounding monetary conditions deserve equal attention. …
There are many reasons tax reform remains a distant dream. Not “tax reform” disguising a tax hike as the Obama Administration envisions, but tax reform that would make U.S. companies and workers world-class competitors, ferret out tax cheats, and make paying taxes a little less onerous to taxpayers. Perhaps the most frustrating reason real tax reform cannot gain traction was on display in The Washington Post over the weekend. In the Post’s business section there appeared an article on why businesses in America are so enamored of debt. The article …
The New York Times got it half-right. Friday’s jobs report was highly discouraging, causing the Times to reflect that “there’s just no positive spin for this.” And you’d better believe they tried. In July, there were 131,000 jobs lost, and the unemployment rate held steady at a worrisome 9.5 percent only because so many potential workers are giving up and leaving the workforce entirely — all adding to the perception of a “dissolving recovery.” The Times complains the Washington policy response has been “inadequate, at best,” and tsk-tsks that a …
