Bold Predictions From Christina Romer

Paul Krugman flags a recent talk by former White House economic advisor Christina Romer and grimly notes that it was not just heartless, evil Republicans who were more worried about deficits than unemployment.

However, in reading through her speech I am struck by her caution and diminished expectations for Obama:

I was thrilled that the President finally spoke about the long-run deficit and presented a comprehensive plan for dealing with it. I was listening to the speech in the car and found myself clapping when I should have been driving. It comes after both the report of the bipartisan commission and the proposal of the House Budget Committee, chaired by Rep. Paul Ryan. Reaching an agreement will obviously be incredibly difficult. The President’s leadership is likely to be essential.

His leadership is "likely" to be essential?  I would not have imagined a deal could come together without him.  Prior to 2013, natch.

FWIW, she lauds the results of Obama's deficit reduction commission, although Obama walked away from it.

Comments

[Clarice]

SOme jobs held are best omitted from resumes. Just saying.

[Dave (in MA)]

Ace of Spades:

Less than a year after he was named chairman of the White House Council of Economic Advisers, Goolsbee plans to return to his teaching job at the University of Chicago, the Obama administration said in a statement. ...
Goolsbee said he looks forward to returning to the classroom environment, where Keynesian economics always works like the models predict.
I may have made that last part up.

[narciso]

You know it's a shame, because she had been known as a decent economist, then she had
to 'deep six' all her findings, in order to sign up with this team,

[Danube of Thought]

a comprehensive plan for dealing with it

Did I miss something?

[bgates]

found myself clapping when I should have been driving, risking the lives and property of people in other cars so I could indulge in a meaningless display of obeisance to my political master.

[jimmyk]

The same for Goolsbee, narciso, even more so.

And let's not even get started on Krugman.

[And right she'll be.]

"The President's leadership is likely to be essential."

Oh, c'mon, she's just predicting failure.
=============

[bgates]

Did I miss something?

"dealing with" s/b "doubling".

[MayBee]

Never fear. All is well.

It isn't Wednesday, but there's a party at the White House. A State Dinner for Merkel. Does anybody else get the feeling the Obamas are throwing as many parties as possible, just in case they only have a year and a half left to do so?

[peter]

Throwing parties on the taxpayers' dime is all that they are really competent at.

[Cecil Turner]

Anyone who doesn't get the connection between the deficit and general economic malaise (and unemployment) doesn't deserve the title of "economist."

[narciso]

Actually considering their protocol follies,
I don't grant them that much credit.

[Army of Davids]

Maybe Krugman will take Goolsbee's spot. Another oldie but goodie for social justice is Joseph Stiglitz. Maybe he's free.

[Jane (sit on the couch or save your country)]

Throwing parties on the taxpayers' dime is all that they are really competent at.

I think, for the good of the country, we should allow Obama to keep his perks until 2012 provided he steps down today. Hey it will be worth the $400 billion it will cost.

[Ignatz]

Let's not overestimate Romer's economic chops.
Once, she made the revolutionary pronouncement that tax cuts lead to more economic activity. That is about the sum total of her work that is not just plain wrong and it has long been agreed upon by both Keynesians and Classical economists. Big deal.
Just having a Dem who is willing to occasionally admit a fundamental truth is cause for canonization these days.

[narciso]

That's why I said decent, that's what she is known for,

[daddy]

Hey JimmyK,

TM responded to you back on the Afghan thread saying "Excellent Point". I am jealous.

That happens once in a Blue Moon. Well done Sir!

[jimmyk]

She's always been a True Believer in the god of Keynes. And that's despite her dissertation work (which was decent) that debunked the view that economies post-Keynes were any more stable than in the dark days before the General Theory.

[Carol.Herman]

Goolsbee resigned. That was like watching George Mitchell hightailing it out of his Mideast negotiator's slot ... just as Obama advanced.

Maybe, Obama just ain't advancing all that much?

[jimmyk]

Thanks, daddy, but in these things I'm a student of my fellow JOMers, so credit goes to my teachers.

[narciso]

It's just more 'leading from behind' in the other direction, at 40 mph

[Ranger]

On a related note, Nate Silver is already prepping the faithful for the grim reality ahead (via Hot Air Headlines):

The 10-Word Question That Could Cost Obama the Election

But Mr. Carter — despite approval ratings in the 30s or low 40s — was holding his own against Ronald Reagan. Some polls, even well after Labor Day, showed the horse race to be tied or even had Mr. Carter with a slim lead.

Mr. Reagan would win overwhelmingly, however, claiming 44 states (even Massachusetts and New York) while limiting Mr. Carter to just 41 percent of the vote. He surged in the final week of the campaign after he posed the following question to Americans in the presidential debate of October 28, the first and only such event in which he and Mr. Carter participated together...

“Are you better off than you were four years ago?” Mr. Reagan asked, dwelling on Mr. Carter’s economic and foreign policy failures. Voters decided that they weren’t, and Mr. Reagan became the 40th president.

Goolsbee's departure, combined the the end of the daily economics breifings at the White House, pretty much confirms that no one in the White House econ team thinks there will be any economic good news over the next year and a half.

[bgates]

The 10-Word Question That Could Cost Obama the Election

Since you can't stop sucking, why don't you just quit?

If you hate America so much, why are you here?

If Bush's five percent unemployment was catastrophic, what are you?

[Melinda Romanoff]

Dan Boren (D-OK).

See ya!

[jimmyk]

Perfect, bgates.

[Jim,MtnViewCA,USA]

Oooo, Romer....an excuse to post a favorite chart! LUN.

[anduril]

Michael Lind offers up The case against "American exceptionalism". Lind is taking aim in particular at statements by Herman Cain.

[lyle]

Since you won't lead, how low is your handicap?

If you're a great scholar, where are your writings?

If Bush sucked, why're you doing similar foreign policy?

[Ranger]

From Jim's link:

Larry Lindsey offered his own review of the stimulus this week, arguing that it failed what’s colloquially known as the Sharp Pencil Test. As he explains, “if you sit down and do a back of the envelope calculation of the [stimulus] program’s costs and benefits, there is no way to conjure up numbers that allow it to make sense.” Here is more on how Lindsey applies this test to the stimulus:

[E]ven if you buy the White House’s argument that the $800 billion package created 3 million jobs, that works out to $266,000 per job. Taxing or borrowing $266,000 from the private sector to create a single job is simply not a cost effective way of putting America back to work. The long-term debt burden of that $266,000 swamps any benefit that the single job created might provide.

We would have been better off if the Federal Government had just held a lottery and handed out 3 million checks for $266,000 to random citizens, or even just to unemployed citizens. That might have produced some actual ecnomic activity.

[Jim Ryan]

The 10-Word Question That Could...

What exactly did we get for quadruple the Bush deficits?

Why prefer big, wasteful government to liberty, prosperity, and charity?

How about a full speech, no teleprompter, before the election?

[lyle]

Crap, it was ten, not nine words.

Okay...

How much weekly partying on our dime is considered "Presidential"?

[lyle]

Are the media as good at fluffing as we expect?

[lyle]

Who's your favorite fluffer? Pick one from each TV network.

[Jim Ryan]

Compare your lifetime achievements with Romney's. Who did more good?

[Extraneus]

Isn't it amazing that liberals believe in Keynesian economics? I mean, they're already for high taxes and huge government, regardless of whether it helps or hurts the economy, and then here comes this theory that says these things are also good to do from an economics standpoint, and it's a theory that they just happen to believe in!

It's an amazing coincidence, I tell ya.

[lyle]

OT: Snort of the day in the LUN. I don't suggest reading the piece unless you have an empty stomach, the title is the snorter.

[Rob Crawford]

Oh, lord, Lyle, if that's their line, they must know he's a one-termer!

[Elliott]

October, 2012:

"Look, the notion that the American people are going to be distracted by a question like this, which, frankly, is one of the relics of the failed policies of George Bush's 1980 primary campaign, from the vital fact that I was the President when our special forces killed Usama Bin Ladin is pretty wee-wee'd up."

[Janet]

Obama 2012

Let's Move!

(from MichellesMirror)

[macphisto]

"I was listening to the speech in the car and found myself clapping when I should have been driving."

well, if nothing else this explains how the car got in the ditch.

[Andrew_M_Garland]

The Obama Team claims that the stimulus saved 3.3 million jobs. How do they know? I can reveal their method, as presented by Christina Romer, recently retired head of the President's Council of Economic Advisors.

Consider this analogy to the idiotic logic of our government economists.

Say that records from my backyard grill parties show that on average 20 guests eat 25 hamburgers and 5 hot dogs. I would like to be much more popular, so I double the food to 50 hamburgers and 10 hot dogs for my next party. I expect 40 people to show up. but without calling more friends.

After a few more parties, I find that 23 people (three more) do show up. Maybe they came because they heard about the huge amount of food. I resolve to supply even more food (stimulus) for my next parties.

Government economists are treating the entire population of the US in the same way that my example treats grill parties. You may say that I am unfairly criticizing government economists. They couldn't be that simplistic and stupid. But, tht is exactly the method they used to recommend "stimulus" and predict new jobs.

--> Romer is Theoretically Correct

President's Council Of Economic Advisers in May 2009 [edited]:
========
To estimate the likely impact of the fiscal stimulus on real GDP, we used multipliers that we feel represent a consensus of a broad range of economists and professional forecasters.

The final step is to take the effect on GDP and translate it into job creation. Not all of the increased output reflects increased employment: some comes from increases in hours of work among employed workers and some comes from higher productivity.

We therefore use the relatively conservative rule of thumb that a 1 percent increase in GDP corresponds to an increase in employment of approximately 1 million jobs, or about three-quarters of a percent. This has been the rough correspondence over history and matches the Federal Reserve Bank model reasonably well.
========

1: Measure the number of jobs in the economy at different levels of GDP. Notice the ratio 1MM jobs per 1% of GDP.
2: Spend money. Each dollar spent adds to GDP by definition.
3: Welcome the newly employed people to the economy.

This is idiocy. This is mere formula crunching. First, express the complexity of the US economy as a simple ratio. Then, play with the ratio by manipulating an accounting measure (the definition of GDP).

Of course, they do get to distribute a huge amount of money to their friends along the way. So, it isn't all that bad. (sarc)

[Extraneus]

Heh. Good one, macphisto.

There sure are some witty people in this group.

[daddy]

While you're stocking up on old style lightbulbs you might think about picking up a couple quality cans of Rat Poison.

KayyyyyyyRoooooooo.

[lyle]

Good gawd, anyone see the pic of Hilda and Huma in Taranto's BOTW? (I'd post it if I knew how. LUN)

[lyle]

And Huma is supposed to be some "beauty"? Well, compared to Hill, I can see it, but come on!

[Melinda Romanoff]

lyle-

This one?

[Porchlight]

Actually I think Hill might have the better of Huma in that pic.

[Extraneus]

we used multipliers that we feel represent a consensus of a broad range of economists and professional forecasters

All of whom are obviously rich due to their ability to forecast the stock market.

Btw, "we feel" is a tell. People who say this are generally people who base their thinking on feelings.

I once took a very interesting management course on this type of thing. The theory is that people can be divided into those who think visually (they say things like "I see what you're saying," or "The way I see it," for example, or even "I see"); those who think aurally ("I hear what you're saying," or "That's the way it sounds to me," etc.), and the feelings-based. If you can put people into these categories, you can better communicate with them on their own terms, and it's usually pretty easy to do.

Who knows if it's valid, but I throw it out there for the group.

[Elliott]

It has been an eye-opening week-and-a-half.

[jimmyk]

Andrew, it's worse than you make it out. In your example, when 3 additional people came instead of the 20 you expected, Obama's team would say that you did get 20 more people, because if it hadn't been for your stimulus, only 13 would have come. How do they know that? Because they know the answer (20 more), so they just work backwards to get the counterfactual. That's "jobs created or saved."

[MayBee]

This thread is full of genius.

[MayBee]

re: banking on Michelle Obama

I half suspect that's why they have all these parties. They like the PR of getting her out there in her party frocks.

[jimmyk]

That '13' in my 5:41 should have been '3'.

[Melinda Romanoff]

MayBee-

Whom are they polling? The 202 Area code?

Or just 202-456-1414?

[Extraneus]

Btw, everyone who took that course spent the next month or longer trying to say "From what the data shows, er, tells us, er, would have us believe, er, indicates..."

[Porchlight]

I half suspect that's why they have all these parties. They like the PR of getting her out there in her party frocks.

They have the parties because Michelle tells them to have the parties. *She* likes the PR of getting out there in her party frocks.

Incidentally, nice use of "frocks." People should use the word "frock" more often. :)

[lyle]

That's the one, Mel!

[Extraneus]

That '13' in my 5:41 should have been '3'.

We got it, Professor. Excellent comment.

[narciso]

So what hack are they going to get to flack the 'crop report' Kutner, bring back Delong,
not that it matters.

[Jack is Back!]

Remember events unknown can overtake reality. I give you the financial "crisis" and bail out in the hot middle of 08 elections where the jousting between McCain and Obama was who should and who shouldn't go back and work on this. Thus the bailout but McCain never looked down again only up.

I believe in the Feiler Faster Thesis and it has of late been shown to be more reliable than prescient polls 18 months out. Then we have this whole "social networking" thing as well as a global economy and agitation that can change electoral dynamics in seconds if not minutes. Look at Weiner. Who is to say what is on Obama's Blackberry. Tiger was untouchable and infallibel and look what happened to him at 2:30 in the morning after Thanksgiving.

I don't buy any argument as to who is beatable and unbeatable until we have contestents and an enthused electorate on both sides or only one. That is why I can't buy Palin is unelectable or Obama is a sitting duck.

[Ignatz]

Man, that picture of Hillary and Huma that Mel posted at 5:35 makes me feel like I'm looking through Rowdy Roddy Piper's glasses:

[Jack is Back!]

Sitting here on the porch of our lake cottage overlooking Canadaroga the bugs are biting, the air is still and I have had another summer epiphany. I now know how bug spray works - it is basically novacaine. It doesn't keept the little b@sta%&S from biting you, it just kills the bite and itch. If you don't believe me then spray some over your face front especially your lips and tell me it doesn't remind of you of a post-treatment at the dentist.

[jorod]

That's alright. We'll just throw more taxpayer money at it.

[Clarice]

JiB

DEET you need DEET

[Old Lurker]

Gin is just as effective, JiB.

Plus in time they become hard to see.a

[centralcal]

banking on Michelle Obama, huh? lol

Did y'all see this on Drudge just now:

Navel indent? check. Tummy outline? check. Crack Ho Hairdo? check.

[bgates]

banking on Michelle Obama

Too Big To Fail.

[centralcal]

Thong Underwear? check.

Dress way too long to walk in? check.

[Sara (Pal2Pal)]

I just learned that women don't wear stockings any more, even when meeting with the Queen, but don't they wear slips anymore either?

[narciso]

In more inspiring news, Clement has been signed up by Brewer to defend SB 1070.

[centralcal]

This picture is too large, but please do look at our graceful First Lady coming down the stairs at the White House, with her gown hiked up to her knees! Good gawd!

[Captain Hate]

Navel indent? check. Tummy outline? check. Crack Ho Hairdo? check.

Eye shadow applied with a putty knife? Check.

Dear God, the thong; I'll never need syrup of ipecac again.

[Porchlight]

And the no-bra look is just delightful.

Ye gods.

[Jack is Back!]

Hey, I'm using 30% DEET and I am telling you it is novacaine. Try it:) But I had a brainstorm and put a carton of worms we had used for fishing on a table a few feet away and bingo - no more flies or other bugs. Brilliant!

Ladies, I have been meaning to ask - is Moochelle what they call "high waisted"? I never knew what that mean't when I heard it but seeing her I think I am now on the right track.

[Army of Davids]

I do not think it is an exaggeration to say history is largely a history of inflation, usually inflations engineered by governments for the gain of governments.
Friedrich August von Hayek

[Clarice]

cc,and right after I ate dinner. PHEH

[C.R.]

Merkel looks quite nice, though.

[Clarice]

JIB-http://www.rei.com/product/686229/3m-ultrathon-insect-repellent-3434-d
It works. Even in India..except in the showers where smarter mosquitos congregate to bite in the few minutes you aren't covered in it.

[Jack is Back!]

Clarice, Janet and Soylent and everyone else in the DC area:

Lets try for a meet up, preferably lunch downtown on either the 12th (late since we leave NYC that morning) or the 13th or 14th of june. We go to Williamsburg on the morning of the 15th. If we can get a good date I am prepared to make the preparations.

sbw, What is in Rome if we come that way beside watching the paper being printed?

We did Howe's Caverns today and the kid is working on the photos and such he wants to show. Post probably tomorrow.

[Jack is Back!]

clarice,

Been a member of REI for years. Good products but I have to tell you the best is B12. Take if for 2 weeks in gross amounts. You will smell like hell but whe you go into the boonies no bites. Too late for the heavy stuff. Will rely on my worm collection to get me through the start of the game.

Hard for a Florida guy but go Mavs! Just to make it interesting.

[Extraneus]

Navel indent? check. Tummy outline? check.

I won't and can't quibble with your other observations, cc, but these two aren't generally a turn-off.

[Janet]

JiB, Any of those dates are okay for me. You guys decide & just give me a call about where & when. I'll be there! I'm leaving the 15th too for Texas.

[Ignatz]

--I won't and can't quibble with your other observations, cc, but these two aren't generally a turn-off.--

Well yeah, if she's cruisin' the strip, which I'm pretty sure she wasn't.

[centralcal]

lol, Ext.

JiB: you could say she is high waisted. Usually this is more emphasized when she wears one of her humongous boob belts.

C.R.: I thought Merkel looked wonderful. Dress was just perfect for her size, her weight and her complexion. Perfect fit and length. She looks elegantly understated and completely at ease.

Unlike Michelle who is having to wrestle with her gown with every moove she makes.

[From the FDIC.]

Note Sheila Bair is leaving, too.
=========

[Janet]

The thong shot is especially sad.

[Sara (Pal2Pal)]

I won't and can't quibble with your other observations, cc, but these two aren't generally a turn-off.

I don't think turning guys (or gals) on is in a First Lady's job description.

[Clarice]

It will be very hard for me to meet up with you on the 14th, but the 13th is doable.

Where is up to you, but there are a number of eateries in Union Station and that's easy for all of us to take the metro there.

[Sara (Pal2Pal)]

Janet: You would think the woman never had a mother to worn her about see-through white and sunlight. Front view, we can see the outline of her panties (ugh), back view we get the legs and looking like she has no underwear on at all. If she doesn't want to wear a slip, then have her designer include a soft lining for the material.

And if she is going to wear long evening gowns and has to negotiate stairs or long red carpet walks, have them sew a wrist strap of satin so she can hold it up in with some style, not hiked up like she is about to squat in the woods to pee.

[Sara (Pal2Pal)]

worn = warn (sheesh!)

[Boogers need attention, too]

"Man, that picture of Hillary and Huma that Mel posted at 5:35 makes me feel like I'm looking through Rowdy Roddy Piper's glasses:"

After 4 hours you should see a doctor.

[Janet]

Well, I have zero high ground on any fashion do's & don'ts, but doesn't the FLOTUS have people that advise her? The underwear showing through is especially tacky for our FLOTUS.

...in the London photos I found it odd that she didn't wear her wedding band. Is that normal? She had on some big rings, but not her wedding band.

[Extraneus]

The thong shot is especially sad.

No argument there, if anyone had any doubts.

[Extraneus]

I don't think turning guys (or gals) on is in a First Lady's job description.

Again, no argument here. But surely the converse is also true.

[Army of Davids]

CNN excluding Gary Johnson from it's June 13 debate?

not cool if true.

[centralcal]

The thong shot is especially sad.

Well, she does have body issues that "containment systems" can't always disguise. I thought the saddest photo of all was of her - the First Lady of the United States - at a State dinner, gallumping down the regal staircase with her dress hiked up nearly to her knees was by far, the saddest of all pictures. She knows, by now, how every snap of the camera, catches her every move and gesture. It is not only an awful visual, but it is one that you can almost insert your own audio to. Clunk, clunk, clunk!

Why, oh why, can't she (or her multitude of "handlers" realize that?

[narciso]

Can you believe this garbage being peddled, which Claudia debunks easily:

http://pajamasmedia.com/claudiarosett/the-truth-about-the-tiananmen-massacre/

[Jack is Back!]

Clarice,

Yep, Union Station is perfect since i want to take Frederick to the train store anyway. How about everyone else. This way Soylent can be Uncle Joe for a day and take Amtrak down and Janet can take the Red Line in. Perfect. Lets set it up.

[Clarice]

Here are the choices.http://www.google.com/search?client=safari&rls=en&q=union+station+washington+dc+restaurants&ie=UTF-8&oe=UTF-8

Since Frederick's along he might prefer Johnny Rocket's. I'm easy ..everyone pick their choice and tell me where and when.

[Janet]

I'm easy too...where & when & I'll be there.