But What Do The Numbers Mean?

Poor data on economic trade date is distorting GDP and productivity:

The fundamental shortcoming is in the way imports are accounted for. A carburetor bought for $50 in China as a component of an American-made car, for example, more often than not shows up in the statistics as if it were the American-made version valued at, say, $100. The failure to distinguish adequately between what is made in America and what is made abroad falsely inflates the gross domestic product, which sums up all value added within the country.

American workers lose their jobs when carburetors they once made are imported instead. The federal data notices the decline in employment but fails to revalue the carburetors or even pinpoint that they are foreign-made. Because it seems as if $100 carburetors are being produced but fewer workers are needed to do so, productivity falsely rises — in the national statistics.

...

The statistical distortions can be significant. At worst, the gross domestic product would have risen at only a 3.3 percent annual rate in the third quarter instead of the 3.5 percent actually reported, according to some experts at the conference. The same gap applies to productivity. And the spread is growing as imports do.

...“What we are measuring as productivity gains may in fact be changes in trade,” said William Alterman, assistant commissioner for international prices at the Bureau of Labor Statistics.

Comments

[Jack is Back!]

"There are three kinds of lies: lies, damn lies and statistics."

Mark Twain

[gearhead]

I don't know what you quoted, or its accuracy, but I can tell you that newly manufactured American automobiles have not had carburetors in them in at least twelve years.

[Jane]

I don't know what you quoted, or its accuracy, but I can tell you that newly manufactured American automobiles have not had carburetors in them in at least twelve years.

LOL - I think he got you TM.

[Patrick R. Sullivan]

I'm with gearhead, I couldn't believe Uchitelle wrote that...and more than once.

[Jack is Back!]

Not only that but if you are real car freak and want a class A carburetor you probably have a Weber, sticker and all. Unfortunately, for the gray lady, Weber is an Italian company and the used to make them in Bologna but now they are made in Madrid.

Another casualty of fact-checking. Should have used buggy whips as an illustration instead.

[Kevin]

Hehe, beat me to it.

Carburetors? Vroom, Vroom!!

[ag]

I thought Obama made a deal to guarantee mortgages for his Chicago pals and then for the Chinese and Merrill just before we guaranteed all the mortgages in the US for the Chinese buy and this confuses GDP/GNP because China owns it all and Obama wanted to tax our GDP and give it to the foreign poor Like the British and Canadians, but that failed in the US so we avoided GDP/GNP shit and let the British eat things like the subways and Africans suing over British tax collection as they avoid giving 1 trillion dollars in climate aid to the same people they already pay their tax too........so it's all really a VAT tax and they're rich and can pay even more!!!!

Caburaters? They haven't changed in over 12 years..............

Yes, we have the new PORTAL OF NEW HOPE, but why can't Obama time travel like Plame his dad worked for 'em too.

[daddy]

Don't know where to post OT Economic stuff but will try here.

Due to the skyrocketing price of Gold in this iffy economy, we learn that ">http://www.adn.com/money/industries/mining/story/1005008.html"> Gold Production in Alaska is higher than its been since 1916.

New mine projects are ongoing in the State, but the Enviro's aren't sitting on the sidelines:

"The increase in mining activity in Alaska has raised concern among environmentalists and some rural communities. For example, two lawsuits have been filed in state court recently seeking to block the Pebble project. One claims that the state's system for permitting mineral exploration is too lax.
On Friday, Gov. Sean Parnell shot back at the mining industry's critics. He said the state will "vigorously defend" the permits it grants and its mine-permit process."

Guess I'll have the girls out gold-panning come summertime instead of playing soccer.

[Ignatz]

--Not only that but if you are real car freak and want a class A carburetor you probably have a Weber, sticker and all.--

Some of us are Jag freaks and will stick with our beautiful, polished, cantankerous SU's, JIB.

[Ignatz]

Since I have a moment, and we're going OT here, seems like you asked me something about the Tongass sometime back, daddy.
As a free marketeer I have to confess I'm in bed with the enviros on this one I'm afraid. The feds artificially glutted the market with their wood all through the 80's and it was only the enviros lawsuits in the early 90's which gave us timber owners any relief on prices. The spotted owl actually made me and other private timber owners a lot of money by returning a free market to us.

[glasater]

Spengler/David Goldman is on Kudlow right now.

[daddy]

Thanks Ignatz,

I welcome your input, because I know I don't know enough about the particulars to make a reasoned, intelligent decision. Thats why I'm running for Congress:)

[Strawman Cometh]

Daddy,
Don't tease us.
Yeah, carburetor, heh. But SU? Que es SU?
Sucking Unit? or Syracuse University

[srp]

Hey, it is an increase in productivity if you get the same output using cheaper resources (even if those resources are overseas).

[Melinda Romanoff]

But it's Chinese productivity if your making carbuerators for cars that don't use them.

And calling them "sales".

Just look for the red queen...

[clarice]

Do you think they have bioethicists in China? Or does it take a really really advanced society to subsidize people's education in a subject like that? And do you think any but the most superior mind--like Singer's-- working in a well funded University like Princeton could manage to find a way to argue that killing your childen and sleeping wth Fido are perfectly ethical?

[daddy]

Well Clarice,

Friedman say's China is an Enlightened Autocracy, so obviously they have bio-ethecists. I think their enlightened version of bio-ethicism comes out of the barrel of a gun.

And why is everybody so upset with TM talking about Carbon-raters? His spelling may be faulty but his AlGorism numbers sure add up.