Tuesday, December 13, 2011

The Myth of the Center For Freedom and Prosperity's Economic Competency

First, watch the video below.  No, really, please watch it.  Try not to laugh.

Done yet?  Good.

Now -- what's missing from the above presentation?  Anybody?  Bueller.. Bueller?

DATA.  As in there isn't any.  In a video on the Great Depression -- in a presentation on economics -- there isn't one chart, graph or picture of numbers in any way shape or form.  Gee .. I wonder why that is?  Could it be that the facts completely debunk what this morons are arguing?  Nah ... they wouldn't want to distort history for a political agenda, would they?

For those of you that what to read an exhaustive set of research on the topic, NDD and I co-authored a set of pieces at the Huffinton Post which you can see here, here, here and here.  Let me hit some of the high points.

First, here is a chart of total GDP for the US economy, inflation adjusted:

GDP dropped from 1929-1933.  Yet by 1937 the absolute level of inflation adjusted GDP was higher than 1929.  GDP dropped in 1937 because Congress went into -- wait for it -- austerity mode -- and sent the economy into recession.  The reason for the nice increase?

A very high rate of growth -- as in right around 10% for three years running and then 5%.  That's an incredibly strong rate of growth.

And no -- government did not kill investment.

Inflation adjusted real gross domestic investment dropped from 1929 to 1933, but was back to 1929 levels by 1937.

And industrial production had also returned to 1929 levels by 1937.

And the unemployment rate actually dropped from 20% to around 10% during the decade:


As either NDD or I wrote wrote in the piece:
(Note: the dotted line is the official current calcuation of the Historical Statistics of the United States that counts workers employed in government makework/infrastructure jobs; the solid line, commonly used by New Deal doubters, is an outdated, former series) that treated such workers, who earned a paycheck, as unemployed!)

Here's the reason for the difference in umemployment readings:
These estimates for the years prior to 1940 are intended to measure the number of persons who are totally unemployed, having no work at all. For the 1930's this concept, however, does include one large group of persons who had both work and income from work--those on emergency work. In the United States we are concerned with measuring lack of regular work and do not minimize the total by excluding persons with made work or emergency jobs. This contrasts sharply, for example, with the German practice during the 1930's when persons in the labor-force camps were classed as employed, and Soviet practice which includes employment in labor camps, if it includes it at all, as employment
The solid line -- the one the revisionists love -- still shows very solid job growth over a decade.  For unemployment to drop from 25% to 15% is a remarkable achievement.  But that number is a complete fiction as explained above.  

Oh yeah -- NDD and I spent the entire fourth article dedunking the revisionist arguments -- which are pure, USDA, grade A bullshit.

In short, the revisionist history presented by the Center for Bullshit and Propaganda's misinformation arm is an utter failure when one actually looks at the data -- something their uncritically thinking (or just plain stupid) followers will fail to do.

Here's the deal.  If you want to have a serious discussion about economics, you need to talk in the language of economics.  That means looking at charts, graphs and data.  The video presented by these yahoos is completely devoid of any hard data.  To the trained seals of the political blogshere, I'm sure it will work, especially when their readership has the IQ of an ashtray and the editors have all the intellectual heft of Mr. Magoo.  Well, homey don't play that crap.  When you have data that contradicts the above charts, please, by all means, put it up.  But until then, why not leave the heavy intellectual lifting to those who can do it  .. like one of my dogs.

PS: have a nice day.