Two of the newer excuses trotted out in recent weeks for the continued lackluster performance of the several “Recovery Summers!” we’ve suffered through under Obama’s stewardship are as follows: first, we’re told, any comparison of the Obama economic recovery to the Reagan economic recovery is “unfair” given Reagan’s ability to factor in growth in the housing market, the single indicator that is keeping Obama’s Keynesian gimmicks from really boosting economic recovery; and second, that unemployment is high thanks in large part to “overseas labor markets” that, because they offer cheap labor, are increasingly coaxing jobs out of the US.
In both instances, we’re being offered rationalizations of the sort that have come to define the Obama Administration. Which, once you peel away the specifics, reveals the same stock excuse always given by the Obama apologists — and the President himself: Hey, don’t blame me. I mean, you should be thankful it’s not a whole lot worse — and it would have been, too, had not I stepped in and added $5 trillion in new debt, pushed for budgets that deficit-spend to the tune of over a trillion dollars yearly, greatly expanded the administrative state, blocked oil and coal production so that gas and electricity costs could “necessarily skyrocket,” and redistributed tax monies to my union buddies and cronies in the “green energy” industry, with spectacular (and predictable) failure as a result.
And in both instances, the excuses — even at the level of specifics — simply don’t stand up to close scrutiny.
In the first instance, for example, Jim Pethokoukis notes:
Obamacrats and other liberals say the Reagan-Obama comparison is unfair. After all, Reagan didn’t have to deal with a collapsed housing bubble. Obama, they contend, was dealt an near-impossible hand and played it about the best he could. Americans needs to lower their expectations, and Reaganites need to quit making the comparison.
The reality: Housing is usually a key contributor to GDP growth during the early stages of a recovery. As a 2011 St. Louis Fed analysis points out, “Somewhat surprisingly, the housing component of GDP (more formally known as residential investment) tends to be a solid contributor to GDP growth during a recovery. Historically, residential investment has contributed only about 5 percent of GDP—a small share considering the consumption component is close to 70 percent. Nevertheless … it can contribute substantially to the GDP growth rate for short periods of time.”
According to Commerce Department data, residential investment added 1.33 percentage points to GDP in 1983, 0.64 in 1984. By contrast, residential investment subtracted 0.11 percentage point in 2010 and 0.03 in 2011. (See chart below.)
But here’s the thing: Subtract the housing rebound from the Reagan Recovery and GDP still grows twice as fast as during the Obama Recovery. For example, the economy grew 7.2 percent in the second full year of the Reagan Recovery. Without residential investment, it would have grown 6.6 percent vs. 1.7 percent growth in 2011, Obama’ s second full year of recovery. Score one for the Gipper … and for supply-side/Schumpeterian economics over demand-side/Keynesian economics.
[emphasis in original]
Similarly, former Fed governor Kevin Warsh (cited by Pethokoukis from a piece in International Economy magazine) explains:
So why is the recovery weak? First, the symptoms have been confused with the disease. Some policymakers have tried to steer a housing recovery without an economic recovery. So there have been a dozen or so programs to “fix” the housing crisis on the theory that once that’s repaired, the broader economy will come roaring back. These housing programs, however well intended, have done little, in my view, to help the housing markets or the real economy. A housing recovery will begin when real household incomes improve, not before.
Second, intentions aside, the broad suite of macroeconomic policies has tended to favor the big over the small—big banks have been advantaged over small banks; big businesses have been favored versus small businesses; and those big multinationals with access to the global economy and global financial markets have benefited more than those on the front lines of job creation.
Third, macroeconomic policies, in my view, have been preoccupied with the here and now, not the long term. So going back several years, Washington has compensated for a faltering economy with temporary programs that plug quarterly GDP arithmetic, but do far less to support long run growth. Massive stimulus has proven not to be as efficacious as many academic models would suggest.
Or to put it another way, the fixes have made things worse, and tampering with the markets has depressed recovery.
Suprise!
As for the second newish meme gaining traction, that “overseas labor markets” are to blame for high unemployment in the States — which, this one must have gone out in some sort of talking points memo, or is being offered up in the latest iteration of the left’s stealthy message coordination listserv, because I heard it a number of times yesterday, from Democrat callers on conservative talk shows to a New York Times economic writer appearing on Greta’s show — this one is transparently silly and smacks of desperation. After all, is Obama the first President who has had to deal with a global labor market where, say, the pay given workers in the Koidu diamond mine in Sierra Leone isn’t quite commensurate with the pay of a McDonald’s line cook? Where labor in Central America is cheaper than labor in Portlandia?
Of course not.
The fact remains that Obama’s attempts at “fundamental transformation” have succeeded only in enriching his friends, allies, and cronies, while institutionalizing the expanded power of an administrative state run by a bureaucratic apparatus that is increasingly beyond the reach of voters.
Obama has failed to revitalize the economy. But he has succeeded in expanding the role of the State, and as such, has waged a successful assault on the individual liberties and individual sovereignty that are bulwarks against the democratic socialist system he and his progressive pals envision in their Utopian end game.
I hoped he’d fail. Too bad so many others on the right elevated their own sanctimony over a reality that was there for all to see. Because so much of the left’s power relies on precisely that kind of shaming, and until we refuse to play under their rules, we’ll always lose the game — however incrementally.
Losing more slowly, in other words.
When the Constitution is upside down, we can’t be surprised prosperity will be too. King Obama wills all hands on the levers! All hands on the levers! To the levers! Now pull! Pull together! Pull by HIS glorious co-ordination!
(King Obama builds his realm as a motion picture slave galley, the levers being oars, only, these oars aren’t oars, but props, and this galley isn’t in water, but on a backlot.)
Pull
slavesgood people, pull the levers! Put your backs to the work, put them in unison, put them together in HIS careful design! Misplace not a beat, lest all be defeated! PULL!And the sticks flail in the air. Any rising tide will take place far from this bark, which is high and dry on staging, distant from the shore.
[…] Does the Gentry GOP Think It is Fooling? Posted on January 28, 2012 9:30 am by Bill Quick Progressive meme busting The fact remains that Obama’s attempts at “fundamental transformation” have […]
For #1.
Good piece at Weekly Standard by Jay Cost.
“He is not interested in controlling the means of production, as Marx put it.”
Geoffb,
I don’t really buy that so much. Forcing business by regulation into coopting practices that promote your ideaolgy IS controlling the means of production.
And I think Obama has more in mind than skimming more of the profit for “socially beneficial” ends.
He’s just going about it incrementally and not enough of us recognize it.
[…] All of what Ace says here is true. They believe that they are acting as moral consultants, and that that activity (since you haven’t got a conscience) entitles them to their cut. Or if you happen to believe that you do have a conscience, you will be told that your conscience doesn’t matter, because it’s not congruent with their conscience, which (unlike yours) promotes human progress, world piece, and Delta smelt, and therefore trumps your piddly qualms and unscientific scruples. Thus it is that con artists rake capital away from capitalists, who actually understand how best to wield it, and dump it into programs like the Annenburg Challenge, that theoretically ought to have benefits in the real world, but that do not . . . apart from lining the pockets of con artists. […]
Ernst,
Are you able to get that speech at scribd to download for you?
Obama’s a good example of what James Burnham called “the managerial class”.
Sometimes it helps to remember that Nietzche thought that socialism was the end-state, or highest form, of capitalism, and not it’s antithesis.
not so far, no.
If you have email contact with sdferr, bh, or Jeff G. I sent it to them last night.
sdferr’s got my email.
The one I hardly ever remember to check.
You want I should forward it on Ernst? Happy to do, only say.
Here’s another meme that needs bustin’ (hey, what are the chances of getting Meme Busters on PBS?). Let’s pretend you are an Apollo 13 astronaut, lost in a worm-hole for 40 years, and dropped back to Earth today. You are presented with two groups of people who explicitly espouse their very different beliefs.
1. Every American is equal before the law.
2. Every American is a representative of a race, and people must be treated according to their race, with this racial group getting preferential treatment and that racial group being discriminated against.
Who would the astronaut think were the racists? Who are the racists? Do you think that’s how this study defined racism? The correct answer, BTW, is that all the astronauts are WEMs and as such their opinions are inherently patriarchal, heteronormative, and hate speech. A little rapey too.
sdferr,
yes, please do.
Vielen dank, mein Herr.
The foundational “progressive meme” is the one embodied in their very name. The idea that progress has a perceivable direction and goal. All of human history, past, present, and future is a previously laid train track upon which we travel. No human can do more than either speed up or slow down the train. never can the direction, the goal that they have foreseen not be the final destination of all humanity.
Speeding up the train is the task of all good progressives. Slowing it down is the task undertaken by the moderates, Republican and Democrat. They both believe the train, track, and destination are real.
That these things are an illusion, a myth is not in them to see. Breaking them from that tunnel vision is the task of what we call the classical liberals.
geoff be nutshelling him some Eric Voegelin I see.
Not consciously though I have read some of him.
Mostly shoveling snow today. Only 31 for temp but a very stiff bitter wind blowing.
Really nutshelled would be “Immanentize the Eschaton.” or as per Voegelin,
Which I’ve read but not the book it is from.
“Obama has failed to revitalize the economy.”
Obama did not revitalize the economy.
Any Progs or moderates (and many Conservatives) who see “failed to” will think you mean he ‘tried, but failed’. I know you know that and I know I’m picking nits; but there are still too many who think Obama is really trying or is ‘just in over his head’.
“Immanentize the Eschaton” is Voegelin.
Or, to put it in your analogy. The real problem progressives have is that they all think they can do a better job than the Traffic Master of keeping the trains running
on timeahead of schedule.I had thought that it was a Buckley shorthand, and am glad to be corrected.
Jonah points out the “moral equivalent of war” meme that infused the SOTU.
Steyn is Steyn on SOTU.
Well and truly, me hearties. Well and truly.
And it’s NOT a new model. The last folks to try it were declared “right-wing” by the other socialists for their heresy of not wanting to have open title on everything.
Oddly, both variations produced slave economies. It’s almost as if the moment you decide to use violence to force the economy to “do” what you want, you’re enslaving people…
I’ve been involved in business since 1980; probably most of us here have been in the business world for years or decades. I’ve been exposed to or involved in international trade for at least half that time.
Gauging by China, labor costs associated with offshored imports are rising, not falling. They have been for at least the time Barry’s been in office. The Chinese have been enjoying a (pre-bust?) boom, and their growing personal reserves constitute for them a much higher (and growing) standard of living.
Costs are up, not down.
The heyday of Cheap Imports™ and Sweatshop Labor™ was, perhaps, during the terms of Bush the Younger or even the Adolescent President before him, assuming there was a heyday not very, very much overshadowed by the far more serious problems of countless tons of regulations on most American business and completely unfair trading advantages bought and paid for in DC by the rest.
Neither promote growth and prosperity and both occured predominately under Democrat Congresses. Physician, f*ck thyself.
To which you can and should add leveraging the US dollar — the world’s American-savaged reserve currency — down to three cents shy of oblivion (imagine just how that running sleight of hand enabled two hundred fifty trillion-odd dollars in debt and unpaid obligations, or as I like to call them, even more debt).
The notion that overseas labor is alone sinking this country and a noble, dollar-defending, jobs-oriented, union-wrecking, freedom-minded Barack Hussein Obama is its unfortunate victim is transparent bullshit — although the FIRE economy is deadly real, but again it too goes back to the market distorting effects of excess regluation by a one party, progressive DC and mostly to American dollar devaluation under that dollar’s present but vanishing reserve currency status — unless of course by “overseas labor” you really mean the race to destruction guaranteed by Barry’s federalized banksters locked onto the bleeding throat of the nation like an alligator on a housecat.
In the face of American sloth and greed — yep, think banksters and the fiat dollar in the Wall St-to-DC corridor again — not manufacturing is a serious, even terminal problem. But Chinese labor is not a component of note in our emerging decline and fall. US imports from China rose only 5.1% in 2008, Barry’s first year wrecking the ship of State. They actually fell over 12% the next year, to only regain their low double-digit growth last year … a pace roughly the same as or even less than during five of the seven years prior to him taking office.
So, not.
Think big picture, Demoncrat meemers. Lots bigger.
Oh.
I put up my own meme-busting post today and it looks like it was picked up by Reddit, momentarily. The Bury Brigade stomped that one down as fast as they could.
Excellent post, mo’ — intuitively knew the 10% number was just so much beagle-squeezin’s, but it’s nice to get some confirmation of that.
Needless to say, the Narrative-defying truth must be suppressed. Think of the children!
Thanks for posting that, motionview. Getting the truth out is important—even if TPTB don’t like it.
@26 the power of the makebelievemedia
@26, There’s no reason to be angry.
Unless it’s anger at Santorum of course, who not only wants to outlaw birth control, but also imprison women what consider abortion, make it against the law for women to work, shoot Mexican immigrants, and really, really intends to implement stoning of American homo’s.
Don’t worry about socialism, be very scared of the Christian politician. He means to destroy…
[…] hell of a lot about just where we are, and what kind of government we really have. Jeff, too, is considering the broader view: The fact remains that Obama’s attempts at “fundamental transformation” have succeeded only […]