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The Obama 8% unemployment claim/prediction has popped up again and there's a new twist to it that I found very interesting. Here's the Politifact entry on the counterclaim (ie, that Republicans claim Obama said XXX): http://www.politifact.com/truth-o-m...bama-said-stimulus-would-cap-unemployment-8-/
First, two quick diclaimers on Politifact:
1. I consider them liberally biased and as a result of that, they missed the implications of a key piece of fallout from this that forms the basis of this thread.
2. They changed their rating system labeling scheme so that "Barely True" is now "Mostly False". I don't think the two labels are equivalent, I don't know if they were intended to be, and I don't really consider their rating relevant to the discussion.
Now, the key facts of the claim/counterclaim that form the basis of this: Obama never said explicitly that if you don't do the stimulus you'll have XXX% unemployment and if you do, you'll have 8% unemployment. The "claim" comes from a report done by his staff and it does include the appropriate disclaimers about accuracy and everyone now agrees with the obvious fact that they - and most others - badly underestimated the severity of the unemployment situation at the time. That's the limit of Politifact's analysis and not coincidentally, imo, the limit of where most liberals go with the analysis.
What's missing from that basic analysis is the actual justification for the stimulus! Here it is:
There are other specific claims/predictions, but I'll set them aside for now. What isn't often pointed out is that his claim/prediction, while not being as specific as what is typically attributed to him, follows-along pretty closely with it. The commonly cited unemployment graph shows up to around 9% unemployment predicted without the stimulus and 8% without it: http://www.google.com/search?q=obam...AEsrt0gHYmviDAw&ved=0CDoQsAQ&biw=1335&bih=910
Equally telling, it shows most of the benefit to have worn-off by the end of 2011 and all of it to have worn-off by 2014. So his "lingering for years" is mostly just 2009-2011.
Now he mentions the possibility of 10%+ unemployment if nothing is done. That's a fair bit higher than his projections, but whatever - it doesn't change the issue much: If 10% unemployment is a disaster that is worthy of an extra trillion dollars in debt to prevent and it isn't prevented, that to me is a significant failure. If the goalposts are allowed to be moved and 10% is now a success, then the justification was flawed to begin with. His real justification, then, is that regardless of where we are or where we are going, a temporary 1.5% point drop in unemployment is worth an extra trillion dollars in debt. Or put another way, pumping-up the GDP in 2009-2011, at the expense of the GDP in 2014 and beyond is worth being able to say 'the recession ended in 2009' instead of 'the recession ended in 2010'. And that's not good enough to me and other conservative critics.
Where it gets interesting is the vague implications that there will be long-term benefit and additional long-term risk if the stimulus was not done. Ivan was kind enough to provide a justification for the stimulus based on short-term benefit alone by showing that since the stimulus can be seen to be wearing-off, the short-term benefit is real:
Thanks for that -- that's the crux of the conservative argument against it, provided for me by a member of Obama's administration itself, via a supporter! Now naturally, neither Ivan nor Obama actually believe that the stimulus is only a short-term benefit, it's just a convenient/easy way to attack a strawman. What they actually believe is that the long term prospects would be much, much worse without the stimulus. But while Obama has some vague implications of that in the speech, he doesn't say it explicitly. More importantly, his own analysis doesn't show a permanent impact or a Great Depression II scenario. And that's where the new (not that new, but new to me) information makes this very interesting:
First, two quick diclaimers on Politifact:
1. I consider them liberally biased and as a result of that, they missed the implications of a key piece of fallout from this that forms the basis of this thread.
2. They changed their rating system labeling scheme so that "Barely True" is now "Mostly False". I don't think the two labels are equivalent, I don't know if they were intended to be, and I don't really consider their rating relevant to the discussion.
Now, the key facts of the claim/counterclaim that form the basis of this: Obama never said explicitly that if you don't do the stimulus you'll have XXX% unemployment and if you do, you'll have 8% unemployment. The "claim" comes from a report done by his staff and it does include the appropriate disclaimers about accuracy and everyone now agrees with the obvious fact that they - and most others - badly underestimated the severity of the unemployment situation at the time. That's the limit of Politifact's analysis and not coincidentally, imo, the limit of where most liberals go with the analysis.
What's missing from that basic analysis is the actual justification for the stimulus! Here it is:
http://www.cnbc.com/id/28559492/Text_of_Obama_Speech_on_the_EconomyObama said:
There are other specific claims/predictions, but I'll set them aside for now. What isn't often pointed out is that his claim/prediction, while not being as specific as what is typically attributed to him, follows-along pretty closely with it. The commonly cited unemployment graph shows up to around 9% unemployment predicted without the stimulus and 8% without it: http://www.google.com/search?q=obam...AEsrt0gHYmviDAw&ved=0CDoQsAQ&biw=1335&bih=910
Equally telling, it shows most of the benefit to have worn-off by the end of 2011 and all of it to have worn-off by 2014. So his "lingering for years" is mostly just 2009-2011.
Now he mentions the possibility of 10%+ unemployment if nothing is done. That's a fair bit higher than his projections, but whatever - it doesn't change the issue much: If 10% unemployment is a disaster that is worthy of an extra trillion dollars in debt to prevent and it isn't prevented, that to me is a significant failure. If the goalposts are allowed to be moved and 10% is now a success, then the justification was flawed to begin with. His real justification, then, is that regardless of where we are or where we are going, a temporary 1.5% point drop in unemployment is worth an extra trillion dollars in debt. Or put another way, pumping-up the GDP in 2009-2011, at the expense of the GDP in 2014 and beyond is worth being able to say 'the recession ended in 2009' instead of 'the recession ended in 2010'. And that's not good enough to me and other conservative critics.
Where it gets interesting is the vague implications that there will be long-term benefit and additional long-term risk if the stimulus was not done. Ivan was kind enough to provide a justification for the stimulus based on short-term benefit alone by showing that since the stimulus can be seen to be wearing-off, the short-term benefit is real:
http://www.cnn.com/2011/OPINION/08/31/bernstein.obama.recovery/
Thanks for that -- that's the crux of the conservative argument against it, provided for me by a member of Obama's administration itself, via a supporter! Now naturally, neither Ivan nor Obama actually believe that the stimulus is only a short-term benefit, it's just a convenient/easy way to attack a strawman. What they actually believe is that the long term prospects would be much, much worse without the stimulus. But while Obama has some vague implications of that in the speech, he doesn't say it explicitly. More importantly, his own analysis doesn't show a permanent impact or a Great Depression II scenario. And that's where the new (not that new, but new to me) information makes this very interesting:
Uh, what? 15% unemployment? While I agree that 50% higher unemployment than was seen at the peak would be a much bigger disaster, where is that number in any of the predictions/projections? What we have here is a reinforcement of the claim he was previously bashed about, but now with specific numbers, out of his own mouth. Paraphrasing, he's claiming that The 10% unemployment rate we saw could have been 15% if not for the stimulus. He and other liberals have long been implying that, he's since made it much more clear. The problem is his own analysis and the analysis of 3rd parties, such as what Ivan provided, contradicts that claim. Obama has taken a weakly supported Republican claim (due to his own vague language) and solidified and strengthened it and proven it to be an accurate representation of his position. And I think he didn't have much of a way around that. Because here's the thing: if Obama really did give us 10% unemployment instead of long-term 15% unemployment for an extra $1 trillion in debt, that would probably be worth it. But he didn't - he didn't come anywhere close to that, and his own specific claims and those of his followers show it. And now that the debt is being made an issue, he's having to try to exaggerate the benefit because he's taking heat for an insufficient cost/benefit ratio. So I expect that he and his supporters will have to continue to ignore the cost and exaggerate the benefit, even if it means digging himself a deeper hole.obama said:
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