Union Economic Chart: Fed Budget & Unemployment Rate =(Dem Pres. are better) NEED FR Response!

IBEW Website ^ | 02/8/04 | Golden Gate

[Golden Gate]

Just The Facts,  Folks!   JUST THE FACTS!
Do Large Deficits Mean High Unemployment?   YOU DECIDE!

From the IBEW Website  (Union Electricians): An Economic Chart, 1969 to 2004:

[Chart Image Only; NO link here; Active Image Link = Below]

(Link to Chart below, Adobe Acrobat Document. Link to Adobe Reader below)

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A color chart, that shows the Federal Budget and the Unemployment Rate from 1969 to 2004.

The message of the Chart is that the Federal budget deficit showed the greatest increase during the terms of the Republican Presidents, while during Clinton/Gore there was the record budget surplus, and low unemployment.

On the chart, there are five text boxes:

•= Despite inheriting from Republicans Bush/Quayle what had been the highest deficit in the history of the United States, $290.4 billion, Clinton/Gore achieved a federal budget surplus in 2000 of $236 billion. This is a $526-billion turnaround!

•= The lowest monthly U.S. unemployment rate since January 1970 was recorded under Clinton/Gore at 3.8% in April 2000. Under Bush/Cheney the unemployment rate in June 2003 climbed to 6.4%, representing 9,358,000 unemployed workers.

•= As the son of the former President, George W. Bush wants us to relive the policies of the past. As the numbers show, those were the "bad old days." The leadership of the Clinton/Gore years produced historically low levels of unemployment, while helping the federal budget go from the largest deficit in U.S. history to the largest surplus. While the two figures are not necessarily interrelated, they are two of the economic indicators that have the largest impact on working families and the economy.

•= The Bush Administration finally admits that the deficit projections depicted here do not reflect "undetermined additional costs arising from ongoing operations in Iraq, extending beyond 2003."

•= BUSH/CHENEY Report Card:

• The surplus is gone.
• Unemployment is rising.
• Tax policy rewards the wealthy and leaves working families behind.
• Economic policy guarantees the highest deficits in U.S. history.

[Chart Link - Below]

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Chart revision #5, prepared by the IBEW ® Education and Research Department, 8/26/03.
© 2003 International Brotherhood of Electrical Workers ®

Sources: Bureau of Labor Statistics; Office of Management and Budget.

1 The budget surplus of 1969 is due to the budget submitted by Lyndon Johnson.
2 Office of Management and Budget, Budget of the U.S. Government, Fiscal Year 2004 Mid-Session Review, Table 1, p. 2.
3 Office of Management and Budget, Budget of the U.S. Government, Fiscal Year 2004 Mid-Session Review, p. 1.
4 April 2000 figure.
5 June 2003 figure.

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JUST THE FACTS,  FOLKS!   ...YOU DECIDE!  =

To Display Chart, Click on [Image] Below:   (Requires Adobe Acrobat Reader - Free Download Below)

Chart URL: http://www.ibew.org/JustTheFact0309.pdf    

(fyi - IBEW chart page)

If you don't have Adobe Acrobat Reader,

Click Here = FREE Download for Adobe Reader  

[Golden Gate]

I think that FR needs to respond to the information and conclusions on this chart. This chart has been around for several years, and this is Revision 5.

[netmilsmom]

Isn't the Clinton/Gore recovery a direct result of Reagan's trick down economics?

[netmilsmom]

Oh shoot, Make that "Trickle down Economics"

(Note to self, proof read, don't just hit the spell check!)

[the invisib1e hand]

trick down economics

roaring with laughter.

I'd take that over clinton's pimped-out economics any day.

[Peach]

Don't let the Rat mantra that "2.2 million jobs have been lost" stand. It is a LIE.

The actual net loss of jobs under President Bush is 330,000.

Business Investors Daily wrote about this last week. Below are excerpts as read by Rush:

I've got a story today from Investors Business Daily. You know, I was tempted to fire off a note to Bill Schneider today but it wouldn't matter. The fact of the matter is we had this number back in I guess it was either September or November, I'm not sure which. Well, it would have been November, yeah, latter part of November. Somebody ran some numbers, the net job loss at that time was 330,000. The number of jobs lost versus the number of jobs created led to a net loss then over the three years of 200 and some odd thousand, 300,000, 330, and that's slowly being wiped out now with the new job creation that's happening with our roaring economy which is leading the world out of its recession, that's not being reported here.

The Investors Business Daily today has a story by Jed Graham, "For nearly a year a debate has been brewing over which of the government's employment measures is wrong. Monthly payroll figures derived from a survey of 160,000 employers show a net loss of 537,000 jobs the past two years. But, the monthly survey of about 60,000 households shows the U.S. has added 2.4 million jobs in that span." Well, we just heard CNN report there are two and a half million jobs lost. Now we find out from Investors Business Daily there are other government numbers that show 2.4 million jobs have been created.

Come on, folks, use your brains on this. This is an ever-expanding economy, I don't care whether we're in a down cycle or not we're always expanding. The population base is always expanding. We are pretty near the statistical full employment number anyway. It's just not logical to assume that all we do is lose jobs. And he didn't say on CNN net job loss, that's not what they're trying to do. They're trying to create the impression that there are two and a half people that used to work that don't because they can't. And that's not what happens. People find work and leave work all the time. It is a cycle, you know it yourself. This idea that there haven't been any jobs created, these guys that report this know this is all a bunch of bohunk but that doesn't fit the agenda, it doesn't fit what the purpose here is. This is to paint a picture of doom and gloom of the U.S. economy, going into this election season, because it matches what? It matches precisely the Democratic Party presidential election playbook. And it just isn't the case. It's the exact opposite.

The economy is roaring back. It's bringing the world back out of its global recession. There are jobs being created. We just had a story the other day of all the unreported self-employed jobs that these employment surveys do not cover. And there were 15 million jobs, net 15 million jobs that do not get reported as people employed in this country. Well, throw that in and it wipes out any of Bill Schneider or any other Democrat's number of two million or two and a half million jobs lost. All of this is a crock. This is the most powerful economic engine in America, and it's rolling, and it's expanding and it is growing. We are the wealthiest country on the face of the earth. To try to paint a picture of this country as a soup line, soup kitchen on the way to depression, is simply purposeful dishonesty, pure and simple.

[netmilsmom]

>>I'd take that over clinton's pimped-out economics any day.

LOLOL! Yeah, me too!

[commonsenseaintsocommon]

The chart does not show the end of the year 2003 with a downturn in unemployment, despite the widening deficit.

Also, ask your Liberals friends if they would not have touched the surplus after 9/11. Any responsible person would have.

[the invisib1e hand]

the chart itself doesn't appear to pass the "5 millisecond attention-span" test, so I wouldn't worry about it.

[T. Jefferson]

The unemployment rate was above 6% the first 3 years of Clinton's term. It's now 5.6%. The federal debt increased every year under Clinton, there was no surplus. He moved normal expenditures off line to camouflage it.

[ReleaseTheHounds]

Besides not passing the "attention span" test, it also fails to show what is causal related to deficits and/or unemployment. This chart shows 2 trendlines and attempts to explain unemployment based solely on government deficits -- if that were the case, Democrats (with their 3 straight decades of deficit spending) would have solved unemployment by the middle of Jimmy Carter's one and (thank God) only term in office.

Where is the trend line for GDP? And tax rates? And tax revenues? And what are the components of tax revenues? Those predicted surpluses at the end of the Clinton years: how much of those tax revenues were tied to capital gains taxes, which came to screeching halt even before Bubba left office (after the looting, pillaging, and pardoning were completed)?

This looks like Paul Krugman's kind of work, so assume it is a lie and just move on.

[Iscool]

The actual net loss of jobs under President Bush is 330,000.

And this all occurred in the area I live in...The rest of the country must be boomin'...

[n-tres-ted]

We know already that figures don't lie, but liars figure. Charts reflect statistics, too, but let's just say they are subject to interpretation. For example:

(1) Here it is February, 2004, but the chart is updated only into 2003. I wonder why. Could it be that the unemployment rate has dropped to 5.6% from the 6.4% they show as their last number? But, of course, that would conflict with their political argument that unemployment rises with rising deficits.

(2) When the economy falls into recession, unemployment rises, welfare costs rise, tax revenues fall and deficits rise. No news in this. Even the Keynesian economists advising the IBEW (if anyone is) agree with this. But IBEW gets it backwards and wrong, saying deficits cause unemployment rather than the other way around. A primary economic "tool" of the Keynesians has been the idea that deficit spending will "stimulate" the economy during recessions, adding jobs at the time they are needed most and jumpstarting economic activity into recovery. That has not been a valid analysis, but IBEW is wrong even in the eyes of FDR's so-called economic theory.

(3) Classical (supply side) economic theory teaches that recessions and unemployment may be caused by adverse events such as war or attack, or back bad fiscal policy (taxes are too high), or by bad monetary policy (the currency standard deteriorates by inflating [losing value] or by deflating [gaining value]. In 1996-2002, the Fed caused severe deflation, the dollar gaining about 50% in value, crushing debtors and destroying business profits as prices dropped. Prices of commodities crashed first, then stock prices began crashing in early 2000 as profits disappeared. Of course, jobs were cut as profits vanished.

(4) GWB was right to propose tax cuts during his 2000 campaign, because that would help in restoring profitability and, thus, jobs. Fortunately, he got the tax cuts passed before 9/11, when the economy was hurt badly by the attack. But the budget balancers kept most of the tax reductions postponed into future years, so we were not restoring profitability or jobs. Then Bill Thomas, Chairman of Ways & Means, pulled the supply side tax cuts of 2003 out of the impasse with the bean counters in the Senate (mostly Democrats, if you can believe it, and a few Republicans). The 2003 cuts improved after tax returns on capital and labor sharply, and the economy is taking off.

(5) That still leaves the monetary policy problem unsolved. Now the Fed has moved its practices from severe deflation all the way back to the other extreme of inflationary. Believe it or not, as much as I deplore saying it, France and the Euro are using better monetary policy than our Fed. The Euro has been essentially stable in value the past year, but the dollar has now lost value so much that it has been falling against the Euro. We are fortunate that the G-7 is pressuring the U.S. to steady the dollar. Hopefully, we will do so. Otherwise, foreigners may decide to sell their U.S. stocks, giving GWB a rough stock market this year.

One more thing. The Republican leadership needs to recognize that this George Soros thing about putting millions into the Democrats' campaign against GWB is tied to monetary policy, not Soros' so-called mission for world peace. Soros wants continued volatility in currency exchange rates. Meaning he likes the Fed just the way it is. GWB is a threat to him because GWB may reform monetary policy. We can only hope.

[expat_panama]

This looks like Paul Krugman's kind of work, so assume it is a lie and just move on.

Right, this is a political rant-- not a study of economics.  Words like "recession", "employment", and "deficit" still have meaning.for people who are working to find out what's really going on.  Political hacks first decide which economic perception would benefit their agenda, then they twist words and numbers to fit.

The really goofy thing about all this is the fact that the graph's headline really is true-- large deficits do mean high unemployment but not the way they mean.  Economies oscillate, when they expand employment, earnings and tax revenue goes up, and deficits go (or should go) down.  During a contraction, the reverse happens - especially because that's when we want the gov't to increase deficit spending to goose the economy.  

The bottom line is that leading indicators (e.g.. stock prices) showed that Clinton screwed up the economy in 2000,  and lagging indicators (e.g. lowering unemployment) show the recovery is well under way.

[n-tres-ted]

And furthermore... LOL

One of the remarkable and truly funny things about this current political-economic scenario is how the Democrats have worked themselves into the "Hoover Corner." With the Crash of 2000-2002 having been caused primarily by the Fed refusing to accommodate the economic growth occuring in the late '90s (especially after the '97 cut in cap gains rates from 28% to 20%), the Democrats now propose to mimic Hoover. After Congress and Hoover caused the crash of '29 by destroying world trade with the major tax increase called the Smoot-Hawley Tariff Act, the federal budget went into deficit due to falling tax revenues. What did Hoover do? In 1932 (the same year he was running for re-election), he proposed a sharp tax increase to balance the budget. The Democrats were glad to accommodate him, and the Senate made the tax increase retroactive to January 1, 1932. I wonder why FDR won...

Then we have FDR. His trademark was deficit spending to pay for government-created jobs and to "stimulate" the economy. But he also loved to raise taxes. After the '32 tax increase, guess what? The Depression got worse. So tax revenues fell more. What did FDR do? He raised taxes. In '34, in '35 and two or three more times in the '30s.

So the Dems are in some ways in true FDR form. Except (our good luck) this time they are not in power.

[hoot2]

dry-wall union=illegal aliens
tree trimmer union=illegal aliens
from ibew 47 news paper:
"The second issue was that on December 12, the majority of the Asplundh employees did not report to work in support of the “Driver License for Undocumented Immigrants” issue. This put the members at risk of losing their jobs and put IBEW #47 in a bad position as well because their actions were not authorized by the local. "

"Owner talked with the police and with his nearby neighbors. Owner made the comment that the Asplund tree trimmers were just here and when he lived in Cherokee Park, after the tree trimmers were in the neighborhood there was a rash of robberies. "

want mexico up here? let your rep know...

[Golden Gate]

Invite to Visit this Thread - Good FR Responses so far!

[DoctorZIn]

Can you post a link to the Business Investors Daily report?

[Torie]

In the 1990's, we had a GOP congress and a Dem president, which is typically good for keeping down deficits. With a Dem congress, the budget picture would not have looked so good. The stock market took off when the Pubbies took control of Congress in 1994, and large capital gains revenue was generated. The value added of computers finally kicked in big time into industry, and it became more efficient, particularly service industries. The GOP congress forced welfare reform down Clinton's throat. Clinton "saved" money by drawing down on the military, and not spending much money on foreign "adventures" except for a fling in Kosovo. Pressure in the fault lines built up and exploded on Bush's watch. And then we had an internet and stock market bubble, generating still move government revenues, and job growth, causing unemployment to drop to historically low levels.

And then the band stopped playing and the music stopped. The internet and stock market bubble burst, and recession kicked in as Bush was taking office, and then we had 9-11. Meanwhile, Bush could not deflect the pressure for drug frebbies for the geezers, and felt the need to cut taxes to jump start the economy if he was not going to go the way of his pere. Meanwhile, employment law dysfunctionalities such as workers' comp and outsourcing made job growth sluggish despite GDP growth. Meanwhile the lumbering beast of the cost of entitlements continued its slow but persistent exponential trajectory upwards, continue to do to the fiscal body what the ebola bacteria does to flesh, eat it alive, from the inside out. Thus the deficit ballooned. Money, money everywhere was needed and spended.

Thus the chart. Kerry will talk about it a lot. But charts are mere end products, not explanations.

And what's Kerry going to do about it? What is he going to do to fund his medical care for everybody, a pristine environment, fully fund no child left behind, slash class size, fund science the way it needs to be, slash the cost of college tuition, and give more generous college loans, and all the rest? Of course, he is going to repeal the tax cuts for the "rich." That will cause the fiscal house to get in order. Piece of cake. The rich are as plentiful a source of funds as the Mississippi is of water. I am sure it all pencils. I am sure Kerry has bean bean counted it all, and with dynamic scoring, to take into account that as rates go up, the rich will report less taxable income.

Keep hope alive.

[Ernest_at_the_Beach]

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The Demonic Rats need to really get busy with the economy as an issue because the War on Terror is going very well, see todays two items:

U.S. Says Files Seek Qaeda Aid in Iraq Conflict

How US Put Rogue Atom Scientist Out Of Business

The titles could be better to convey the full accomplishments.

[Torie]

Torie swings right for tonight.