The Economy Line: Kerry's Misleading Economic Attacks

FactCheck.Org: Kerry's Claim That New Jobs Pay $9,000 Less Is Based On "Disputed Analysis From A Liberal Think Tank," Wages Are Actually Increasing. "In his acceptance speech at the Democratic National Convention July 29 Kerry repeated a claim that the economy is creating jobs that pay $9,000 a year less than those they replace. He bases that on disputed analysis from a liberal think tank. … Kerry also said 'wages are falling' when in fact they are increasing. It's true wages haven't kept up with inflation for the past several months. But even after adjusting for inflation they're still higher than when Bush took office." ("Kerry's Dubious Economics," FactCheck.org Website, www.factcheck.org, Accessed 8/3/04)

FactCheck.Org: Kerry's Assertion That The "Middle Class Is Shrinking" Is Based On Outdated Data. "And when Kerry said the 'middle class is shrinking,' he was referring to what happened in the recession of 2001 and the initially slow recovery of 2002. But the economy has picked up considerably in the 19 months since, so what was true then may be untrue when phrased in present tense." ("Kerry's Dubious Economics," FactCheck.org Website, www.factcheck.org, Accessed 8/3/04)

FactCheck.Org: Kerry's Claim Is Not Supported By The Figures He Is Using. "Kerry bases his claim on an analysis of Bureau of Labor Statistics data by the Economic Policy Institute. But the EPI figures don't support what Kerry said, because they don't actually compare new jobs and old jobs -- only broad averages for entire industries. And as we reported July 9, other BLS numbers that compare occupation groups within industries tell a completely different story -- showing higher-paying groups growing faster than lower-paying groups." ("Kerry's Dubious Economics," FactCheck.org Website, www.factcheck.org, Accessed 8/3/04)

Barry Bosworth, Brookings Institution Economist: Kerry's Method Is "Very Misleading." "Brookings Institution economist Barry Bosworth, a former Carter administration official, says Kerry's approach is 'very misleading:' Bosworth: 'We shouldn't be in the business of trying to compare the rates of jobs lost to those gained because we just don't have the information right now to do it. Trying to measure the gross flow of jobs is really futile.'" ("Kerry's Dubious Economics," FactCheck.org Website, www.factcheck.org, Accessed 8/3/04)

Laurence H. Meyer, Clinton Appointee To Fed Board: Kerry's Effort To Talk Down Jobs Created Is "Overhyped." "Economist Laurence H. Meyer -- who was a Clinton appointee to the Federal Reserve Board -- calls Kerry's characterization an exaggeration. Meyer told FactCheck.org: 'It's overhyped... There is an element of truth to people feeling hard-pressed and less secure in their jobs. But while this is happening, the U.S. is rapidly seeing increasing productivity rates which will effect an increase in the standard of living.'" ("Kerry's Dubious Economics," FactCheck.org Website, www.factcheck.org, Accessed 8/3/04)

FactCheck.Org: Average Hourly Earnings Up 2.1 Percent Since The President Took Office. "BLS figures show that average hourly earnings for fulltime production workers went from $14.27 when Bush took office to $15.65 in June. That's an increase of 2.1% even after adjusting for inflation." ("Kerry's Dubious Economics," FactCheck.org Website, www.factcheck.org, Accessed 8/3/04)

FactCheck.Org: Hourly Earnings Gained 1.6 Percent In The Past Year. "Hourly earnings have been rising steadily in the past year as well, gaining 1.6%. That would have kept just even with inflation except for a spike in volatile food and energy prices over that period. After adjusting for all prices, however, hourly earnings fell 1.4% since July 2003." ("Kerry's Dubious Economics," FactCheck.org Website, www.factcheck.org, Accessed 8/3/04)

Consumer Confidence Improves. "Consumer confidence remained near its high for the year last week as Americans' outlook on the future of the economy improved slightly, according to a survey released on Tuesday. The ABC/Money magazine consumer comfort index gained a point to -6 for the week ended Aug. 1, 2004 and stood above its 14-year average of -9." ("Consumer Confidence Holds Steady," CNN/Money, http://money.cnn.com/2004/08/03/news/economy/abc_money, 8/3/04)

Auto Industry Rebounds In July. "Auto sales rebounded in July after a disappointing June, driven by hot products like the Toyota Sienna minivan and the Chrysler 300C sedan and by big incentives on sport utility vehicles, figures released on Tuesday showed. Ward's AutoInfoBank estimated that July's seasonally adjusted selling rate was 17.24 million units, a sharp increase from the 15.4 million-unit rate in June, the lowest in six years." (Fara Warner, "Bargains Help Auto Industry Recover In July," The New York Times, 8/4/04)

Personal Income Increases. "Meanwhile, personal income advanced 0.2% in June after rising 0.6% in May, the Commerce Department said. The increases helped produce the third consecutive quarter of income growth. 'The recent strength in income growth should support consumption growth over the second half of the year,' said Gary Bigg, an economist at Banc of America Securities LLC." ("Consumer Spending Declines, But Personal Income Increases," Dow Jones Newswires, 8/4/04)

Why ping me?
I have no dog in this fight.
Sheeesh, without a Perot or PJB in the race, an economic "debate" between Kerry and Bush will have less substance than an episode of SpongeBob SquarePants.

It's true wages haven't kept up with inflation for the past several months. But even after adjusting for inflation they're still higher than when Bush took office

Oddly the government also puts out this inflation number and has a vested interest in saying its low. Have wages kept up with the cost of purchasing a house?

Also this doesn't take into consideration that employees are being asked (that's a polite way of saying it) more for their medical expenses.

But while this is happening, the U.S. is rapidly seeing increasing productivity rates which will effect an increase in the standard of living.

Let's see ... if you lay off 50% of your American workforce and move it overseas where they work for much less of what they do here, that company's "producticity per US worker" just shot up by around 50%. Does that mean our standard of living has gone up? No.

Let's see ... if you lay off 50% of your American workforce ...

You see massive increase in unemployment? Where?
You see falling American wages? Where?

You've bought the hype from the Left. And maybe you have a personal story of economic difficulties. But the FACTS are that the American economy is strong, getting stronger, and that just about everyone is benefiting.

this doesn't take into consideration that employees are being asked (that's a polite way of saying it) more for their medical expenses.

Goodness, that terrible-- not only that, those horrible employers are forcing the poor poor workers to pay for all of their own food out of their own pockets. I hear that those terrible employers are even forcing non employees to pay for all of their food and all of their medical costs.

Let's see ... if you lay off 50% of your American workforce and move it overseas where they work for much less of what they do here, that company's "producticity per US worker" just shot up by around 50%.

Only in protectionist dreamland. There's a reason it's called Gross Domestic Product. And GDP is what one uses to calculate output.

Funny.

Yes, many do find humor in pathos.
And the two offerings of the competing Republicrat factions are truly pathetic.
Not much of a choice during this election cycle.
Not much of a choice at all.
Pitiful.
Pathetic.

There's a reason it's called Gross Domestic Product. And GDP is what one uses to calculate output.

That's also why the Trade Deficit is SUBTRACTED from the components that are used to calculate GDP.
That's why factories that are outsourced offshore HURTS our GDP.

You've bought the hype from the Left.

I see you've got your knickers in a twist over what was an example of how "US productivity per worker" is really meaningless unless all the facts are considered.

Of course there isn't 50% unemployment out there (I can't believe I have to spell that out. Well maybe to someone that uses Clear Case :). That's a joke too, btw.), what I'm showing is that the ratio of (revenues) / (US workers) can go up by either a) increasing revenue, or b) decreasing one's workforce.

So when a company shifts manufacturing over to Mexico or China and they can say their "productivity per US worker" has gone up. There's no political slant to simple math.

If the trade deficit is subtracted from the GDP calculation (which it is), then how can you simultaneously argue that off-shoring affects the productivity calculation? For that matter, what does off-shoring have to do with the trade deficit calculation in the first place?

Gross Domestic Product.

How much does Dell add to the GDP? Can you count the total amount of computers sold (as most of the parts are made overseas)? Or just the value add that they put into it (they do some assembly here)?

Keep in mind that computers have a "chained" multipler of 8 associated with them. So buying $1 of computer "stuff" today will result in $8 of "GDP" dollars. This is, presumably, to take into account than a business will be N times more efficient (how they got to 8 I don't know) than if they relied on pen and paper.

Also federal spending is included in GDP.

How much does Dell add to the GDP? Can you count the total amount of computers sold (as most of the parts are made overseas)?

Ah yes, the old "we don't make nuthin', no where, no how" argument. How do you know the domestic content of Dell computers? How do you presume that Dell is indicative of the rest of its industry, or other industries? As if American manufacturers don't have domestic vendors. LOL

If the trade deficit is subtracted from the GDP calculation

I'm not sure what that has to do with "productivity per US worker." Per the definition of productivity in this BLS press release:

productivity data--as measured by output per hour of all persons

Now what's "output per hour"? To me that means "take yearly US revenue and divide by the number of US employee hours" This number doesn't care if 99% of a widgit sold in the US was made in China and sold here. All the company selling it reports is that they have revenue of $10 per part.

Then again, who knows? With this monkeying around of "chaining" dollars in the GDP I'm certain the government isn't using something clearcut to define producitivity either.

Ah yes, the old "we don't make nuthin', no where, no how" argument.

You're missing two points: 1) you've failed to account how this affects "US productivity per worker" and 2) skipping over this "chaining" voodoo of the GDP

How do you know the domestic content of Dell computers?

I have no idea, nor did I claim to. But when people trot out "US worker productivity is going up" and its easy to see that this ratio can be increased in one of two ways, I think its fair to question how the number's derived. You've offered nothing more than "you're a Kerry lover" arguments, which isn't very satisfying. If you have some knowledge on how this number is calculated and can answer some questions I'll be happy to talk. Questioning motives of people asking for definitions is eerie, to say the least.

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