Friday’s better-than-expected jobs report, while cheering stock investors, hasn’t taken the threat of a double-dip recession off the table.
Even as the jobless rate held steady at 9.7 percent and the 36,000 workers laid off in February was much less than expected, economists and investment analysts said it’s still too early to discount the economy’s chances of revisiting recession.
There are times I am tempted to feel badly for Harry Reid, given that he has the undesired gift of not knowing what to say in sensitive situations. Then, I remember that there are other people who deserve my sympathy more.
Peter Suderman’s article on why we cannot trust CBO estimates concerning the value of the stimulus is a must-read:
Here’s what the Congressional Budget Office’s (CBO) most recent report on the matter estimates the stimulus’ effects were in the fourth quarter of 2009: Thanks to the stimulus, America is somewhere between 1 and 2.1 million jobs richer than it would have been with no government intervention. Federal dollars have fattened up our GDP as well, adding somewhere between 1.5 and 3.5 percent to the GDP.
Naturally, the Obama administration is keen to take credit. And in touting the CBO’s stimulus figures, the White House repeatedly employed the phrase “created or saved.” After widespread eye-rolling at such an obvious rhetorical gimmick—not to mention significant evidence that many of the jobs it was claiming credit for were not, in fact, created or saved—the administration altered its lingo and started referring to jobs “funded.” But this too is not as accurate as it could be, at least in the context of the CBO’s reports; a better phrase might have been “created or saved or estimated or assumed.”
The Administration believes it has found both a good policy, and a winning political issue; taxing the foreign earnings of American firms, along with rhetoric about how the current tax system allows for American firms to engage in tax dodginess, and the outsourcing of jobs overseas.
It’s a pity that we will be looking to the Administration to give us guidance on job numbers. The reason it is a pity is that the numbers the Administration is giving us cannot be trusted:
The Obama Administration likes to make grandiose claims concerning the number of jobs it expects will be created thanks to its stimulus plan. The problem, however, is that the Administration regularly ignores the amount of uncertainty that exists in the debate over job growth:
