Economic fearmongering at TPM

It HAS TO BE an age-related thing, with bloggers and other online-heavy folks, presumably under the age of 35, or at least under the age of 40, totally ignorant of the 1980-82 recession, even to the point of seemingly salivating at the chance of using the “D” word. Paul Kurtz at Talking Points Memo is the latest guilty party.

Yes, it is true that, in terms of raw numbers, the U.S. economy lost the most jobs since 1945. But, even that is long after the Depression.

But as a percentage decline, it’s nowhere near as bad, considering the population of 305 million today is almost double that of 1945.

In fact, per CNN’s own graph, the 2008 losses aren’t as bad as 1982, as percentage of total population; it’s 8.5 percent for last year vs. 9.5 percent in 1982.

Tis also true that the unemployment percentage is going up, but it is nowhere near as bad as the last real recession, of 1980-82.

If you're not over 40, you may not remember the "double-dip" 1980-82 recession. But can we hold off saying this is the worst crisis since the Depression?

Now, it is true, as Kevin Phillips has so well noted, that unemployment calculation methodology has been, to be blunt, "fudged" since 1982. That said, some of the fudging had been done before then, as Phillips has also written.

And, as Phillips also has noted, fudging numbers has been a bipartisan affair, with Democrats back to JFK "trimming" on unemployment and the GOP "trimming" on inflation.

That said, as I note, there's a full percentage point difference between 2008 job losses and 1982. Even with allowance for fudging, I don't think you can say problems now are significantly worse than they were then.

I’ve said it before: Sometimes, whistling past the graveyard is nothing but false optimism. But at other times, becoming too afraid of the “graveyard” is a self-fulfilling prophecy.

And, at least for now, I think the MSM is too much in “self-fulfilling prophecy” mode.

Also,2008 losses were less bad than two different consecutive years from the last serious recession.

First, per information from Jim Glass, about which I wasn’t sure and hadn’t checked, CNN, et al, doubly blew it, as has WM poster "Joe Friday."

Turns out 1983 was a worse year for job losses, by percentage of workforce, than both last year AND 1982.

Yes, the "augmented unemployment rate," of part-timers, discouraged and semi-discouraged, plus traditional unemployment, may be at 13.5 percent.

I found further relevant data back to 1970 at Brad DeLong's site going back to 1970, data about the employed as a percentage of the total workforce, just to further confirm what I've already said.

The ratio was .60 in 1982 and about .63 this year.

Adjusting for that, jobs lost to number of civilian employed, as percentage, was worse yet in 1982, at 15.67 percent, than the 13.45 percent last year, thus strengthening my argument.

Yes, there are other ways of skinning the cat, but per the job-loss measure which, as I said, is not fudgeable, 2008 wasn't as bad as 1982. Nor as bad as 1983; I noticed

Now, 2009 may well be worse. I'm not denying that. But, let's not yet get too much into doom and gloom.

Otherwise, folks like Mr. Kiel exemply why, although I'm on the demographic borderlands between Baby Boomers and Gen X, I don't want to be considered part of either group.

I am certainly not in the older end of the Boomers... the folks who screwed this up in the first place and inflicted narcissism on the future.

BUT... I'm not in the often-solipsistic mindset of Gen X, especially the younger part of that cohort.

Frankly, I think those of us born about 1961-66 are parts of a "lost generation."

Is mainstream media fearmongering the recession?

I not only hear that thrown around as a general rhetorical question; as a newspaper editor, it sometimes comes to me personally.

Being over the age of 40, and remembering well, the Carter-Reagan recession, I’d have to give a qualified Yes to that question. For example, this Time graphic compares recent job losses to the 1992 and 2001 recessions.

BUT… if you’re over the age of 35, you know both of those recessions were mild.

Even worse, since the Internet world, especially the Internet commentary world of blogs, blog readers, etc., skews quite young demographically, the “kids” there seem historically clueless about the U.S. economy before Bill Clinton became president.

But, the reality is the Carter-Reagan recession was worse than this one’s been so far.

How much worse? In BOTH 1982 and 1983, job losses, as a percentage of workforce, were , worse than 2008.

But, thanks to historically cluelessness of much of the wired generation, historical amnesia of the “old media,” and, I suspect, a bit of narcissism among Gen X, or at least the younger portion of it (I don’t consider myself to be fully a Boomer OR fully a Gen X person), we get doomsaying that, for right now at least, is indeed over the top.

In fact, the more and more the “ohhhhhh, so bad” line grows as a talking point in the wired world, the more I wonder about whether narcissism, rather than historical cluelessness, isn’t the primary driver

Yes, 1982 was worse!

Far worse, in fact, than 2008.

Small comfort, that, but respected economist David Leonhardt shows why I was right when I pointed out – primarily to the under-35 crowd, two weeks ago, that wailing over 2008 job losses was overblown and lacking historical context.

Anyway, here’s Leonhardt’s nutgraf, courtesy of information from the Bureau of Labor Statistics:

It’s not even that close to being as bad. The ranks of unemployed and underemployed, controlling for the size of the population, were much larger in 1982 than today.

He then tackles the issue of those wet-behind-the-ears bloggers and would-be online pundits who have no historical context:

The recession of the early 1980s doesn’t have a catchy name, and almost half of Americans are too young to have any real memory of it. But it was terrible — qualitatively different from the mild recessions of 1990-91 and 2001.

As someone who’s over 40, not just 35, and was wrapping up high school at this time, I can tell you it was serious indeed. Leonhardt says on the employment side, the total of unemployed/underemployed/discouraged, while high right now, is still 3 full percentage points or more below the worst spot in 1982.

If that’s not clear enough, the graph at left is crystal clear. In terms of employment, at least, we’re nowhere near 1982 right now.

Now, could things get not just a little worse, but a lot worse? Yes; Leonhardt says that, too. But, his bottom line is, 30-somethings, and especially 20-somethings, should shut up and stop acting like Chicken Littles.

Read his full column.

It’s stuff like this that makes me feel “older,” to the point of feeling a semi-curmudgeonly “older” about today’s “kids” and their lack of suffering or whatever.

CNN fails to put job-loss figure in historic context

While bad, it isn’t necessarily all that bad

Updated, June 5, 2009, at bottom.

Yes, it is true that, in terms of raw numbers, the U.S. economy lost the most jobs since 1945.

But as a percentage decline, it’s nowhere near as bad, considering the population of 305 million today is almost double that of 1945.

In fact, per CNN’s own graph, the 2008 losses aren’t as bad as 1982, as percentage of total population; it’s 8.5 percent for last year vs. 9.5 percent in 1982.

If you're not over 40, you may not remember the "double-dip" 1980-82 recession. But can we hold off saying this is the worst crisis since the Depression?

Now, it is true, as Kevin Phillips has so well noted, that unemployment calculation methodology has been, to be blunt, "fudged" since 1982. That said, some of the fudging had been done before then, as Phillips has also written.

And, as Phillips also has noted, fudging numbers has been a bipartisan affair, with Democrats back to JFK "trimming" on unemployment and the GOP "trimming" on inflation.

That said, as I note, there's a full percentage point difference between 2008 job losses and 1982. Even with allowance for fudging, I don't think you can say problems now are significantly worse than they were then.

I’ve said it before: Sometimes, whistling past the graveyard is nothing but false optimism. But at other times, becoming too afraid of the “graveyard” is a self-fulfilling prophecy.

And, at least for now, I think the MSM is too much in “self-fulfilling prophecy” mode.

Update: Per some comments at Washington Monthly, especially as one would-be apparent doom-and-gloomer keeps trying to shoot me down on 1982 being worse, it turns out he's digging himself an ever-deeper hole, and is obviously under the age of 40, if not under the age of 35.

First, per information from Jim Glass, about which I wasn’t sure and hadn’t checked, CNN, et al, doubly blew it, as has WM poster "Joe Friday."

Turns out 1983 was a worse year for job losses, by percentage of workforce, than both last year AND 1982.

Yes, the "augmented unemployment rate," of part-timers, discouraged and semi-discouraged, plus traditional unemployment, may be at 13.5 percent.

But, unemployment numbers, with or without fudging, weren't broken out in such detail in 1945. It also obscures the point that jobs lost is a straightforward non-fudgeable stat that was worse by a full percentage point, in terms of population percentage, in 1982 than today, and was twice as bad in 1945 than today.

Joe Friday at WM still couldn't accept that. He said that, if I looked at civilian employment-population ratio, noting it was lower in the late 1990s at least than in 2008, last year would turn out looking worse than 1982 after all.

That said, I found data back to 1970 at Brad DeLong's site going back to 1970.

The ratio was .60 in 1982 and about .63 this year.

Adjusting for that, jobs lost to number of civilian employed, as percentage, was worse yet in 1982, at 15.67 percent, than the 13.45 percent last year, thus strengthening my argument.

Yes, there are other ways of skinning the cat, but per the job-loss measure which, as I said, is not fudgeable, 2008 wasn't as bad as 1982. Nor as bad as 1983; I noticed

Now, 2009 may well be worse. I'm not denying that. But, let's not yet get too much into doom and gloom.

Remember that statement about fear a certain other Democratic president made in 1933? And, if you're going to claim that you already know the current recession will turn out worse than 1980-82, don't post here unless you first send me some proof of your age.

Update, June 5, 2009: Welcome to people hitting this blog post after announcement of the May unemployment numbers, along with the news that, NOW, not six months ago when I made this post, the unemployment numbers as of May are being noted as the worst in 25 years. That is, the worst since 1984, as the last effects of the 1980-82 recession petered out.

Subaru defies auto sales odds

The Japanese automaker is the only major manufacturer to post higher sales for 2008. GM, on the other hand, had its worst sales year in half a century.

Retail closes doors on lackluster 2008

More and more news piles in about just how bad this year's Christmas shopping season was, and what it will likely mean for 2009.

The big, big dropoff from last year happened the weekend before Christmas, off 24 percent. What it means is that even those last-minute discounts couldn't drum up fence-sitting shopping business. So, whether or not the retail economy should be that bad, perceptions of it are. Analysts also blame bad weather and the exact time location of this year's weekend relative to Christmas, but I would downplay those factors.

Meanwhile, more bankruptcy filings make it look like 2009 could be pretty Darwinian in the retail world.

You know it’s a recession, Dallas-Fort Worth version

November pre-owned home sales were off 33 percent from a year ago. And price dropped 7 percent.

The sales percentage decline is the largest recorded in this area; read the full story for more details.

With continued softness in the new-home market, and the recession lessening the flow of business relocations, I’d expect residential real-estate softness for 7-9 months or so. And, if Big D is in that much recessionary struggle, no, this probably won’t be a mild one.

Unemployment numbers in literary riffing

First, who has NOT blogged about the unemployment numbers in the crapper, the worst in job cuts since the first oil crisis?

But, there are a couple of ways to look at it.

One is, per Mark Twain and obits:

When I got up in the morning and didn’t see my name as among those being fired, it was a good day.

The other, per a guy named Ronald Reagan:

Recovery starts when George W. Bush leaves the White House.

The unemployment rate has climbed 2 full percentage points in a year. Wunderbar.

Want more fun news? Home mortgage foreclosures hit nearly 1.4 million last month.

For Obamiacs and Krugmanites who say ‘spend away’

I offer the counter-example of Japan. Japan, with the highest debt burden of any modern nation — debt at 182 percent of GNP — has little money for m ore programs for the elderly, for example.

We’re not aging as rapidly as Japan is, but, we would be at zero population growth without immigration, at best.

Ignoring typical conservative diatribes about the imperiled future of Social Security, treating a $1 trillion deficit cavalierly isn’t advised.

Yes, FDR pushed us back into deeper economic malaise when he tried to be a budget-cutter in his second term.

That said, his deliverance from both a strong depression AND from monstrous deficits was found in World War II.

I don’t think that’s a bankable repeat economic plan.

But Steve Benen, for example, riffing on Paul Krugman, say, “spend away,” though.

We’re fortunate we’re not as old as Japan. But, we’re moving more that way.

And, if we were a Third World country pulling this crap, the IMF would be beating down our collective national door with a battering ram.

Other critics of the Krugman column are right — it’s a blank-check license to spend without doing some analysis of what a bottom line should be.

‘Deflation’ watch – 2008 Christmas shopping could contract

When, for the story, at least one shopper says she’s willing to wait until Dec. 26 to buy Christmas gifts, it could be a slow shopping year indeed.

Recession headed to Texas too

Just because housing prices in Dallas and Houston haven’t cratered like Phoenix, Miami and SoCal doesn’t mean Texas will escape scot-free from the economic downturn.

The Dallas Fed has officially weighed in, and the prognosis isn’t good. Much of the state’s economy is at a four-year low, and 2009 is supposed to be worse.

Spamalot! In the recession

Spam — it’s really what’s for dinner


Allen Brisson-Smith for The New York Times

Austin, Minn., has 13 restaurants with Spam on the menu, including Johnny’s.

Yes, Hormel, the folkis in Austin, Minn., love the recession. That’s because, when times get tough, the tough-gutted buy more Spam.

Right now, Hormel’s Spam factory, or whatever you would call it, has literally been running around the clock seven days a week since July. And, it’s not going to let up. One day shift recentl cranked about 150,000 Spam tins.

A silver lining to the recession – cheaper lawyers

In this recession, unlike previous ones, law firms are having to tighten their belts, too. That includes flat-rate billing, among other things.

Beyond that, some firms have already gone belly-up.

But, law firms charging less for their corporate services is unlikely to trickle down to you and me.

Credit crunch silver lining

And, that is less junk mail in moths ahead. In fact, due to postal increases, catalogue mailers have already cut back.

Pity Iceland, scorn the IMF

Per the normal “austerity measures” the International Monetary Fund inflicts on client countries, Iceland is raising interest rates to 18 percent. Now tell me, just how is this actually supposed to help Iceland’s economy recover?

I, Robot may have more post-recession jobs

It wouldn’t totally surprise me, per this Wired story, to even see Wal-Mart’s future union-busting efforts tapping into robots. As we speak, within a canned range of expression, robots could be made to replace Wal-Mart greeters.

That said, the idea that Wal-Mart would voluntarily “share the wealth” after post-robotics “permanent layoffs” is laughable ion general and doubly so coming from a libertarian mag like Wired.

Merck layoffs mean real recession

Big Pharma kingpin making job cuts

As Electoral-Vote.com notes Electoral-Vote.com notes, Big Pharma folks are relatively immune from recessions. People are getting sick all the time.

So, Merck's announcement it will lay off 7,200 employees has to be considered an indicator that this is a real recession, not a mild one at the end of Bush I or the end of Clinton/start of Bush II. This will be like the longer, deeper, Carter-Reagan recession.

Ben Bernanke wrong on rate cut idea

Federal Reserve Chairman Ben Bernanke said today he leans toward another interest rate cut.

Wrong idea, Ben.

Liquidity is not a problem, only trust. Another rate cut means another bubble down the road.

Southwest Airlines drops a dime — it is a recession

If Southwest, which has long boasted of its profitability when compared to “legacy airlines,” is losing money, we’re in a recession.

And, that’s not just hyperbole. The last time Southwest posted a quarterly loss was at the start of the Bush I recession.

That said, if you throw out special accounting charges, the airline still turned a profit.

At the same time, the road ahead may be less than turbulence-free. Wild swings in oil prices may undercut much of the vaunted fuel hedging advantage Southwest has enjoyed in the past.

SF and STL Fed heads – we’re in recession

Now that San Francisco Federal Reserve Chairwoman Janet Yellen has said it, it’s going to be hard for Bush – or McCain or Obama – to deny.

St Louis Fed Chairman James Bullard Now that San Francisco Federal Reserve Chairwoman Janet Yellen agrees on the recession, but is more worried about inflation in the future than Yellen.

Related to this, the Dow is down more than 500 in mid-afternoon trading.

Advantage theoretically to Obama, but, it’s going to increase the “talk in specifics” pressure on him about his plans to address it.

And, I would guess it will be in a debate question tonight.