Center for American Progress: A Heritage of Distortion (Taxcut & job lies)

[papau]

From a great emailed newsletter from Center for American Progress

ECONOMY
A Heritage of Distortion
Proclaiming that the Bush tax cuts are working, the right-wing Heritage Foundation released a memo claiming more than 1 million new jobs have been created over the last year – a big shock to the 2.3 million unemployed Americans. How did Heritage come up with such a rosy scenario? They used inaccurate data. There are two sets of government data that track employment: the household survey and the establishment survey. According to the nonpartisan Congressional Budget Office, the widely-cited establishment survey data "better reflects the state of labor markets," is less likely to include "large revisions or misreporting," and better conforms to other indicators like the unemployment rate. Accurate data shows that 276,000 jobs were lost over the last year. Heritage, of course, chose to use the undependable household survey.

MANIPULATING THE LESS RELIABLE DATA: According to Lee Price of the Economic Policy Institute , Heritage went one step further and actually manipulated the household data survey to further inflate their numbers. In January 2003, the U.S. Census Bureau made a technical change which artificially added 576,000 jobs to the household survey. As a result, the Bureau of Labor Statistics warns that household survey data on "employment and unemployment levels for January 2003 (and beyond) are not strictly comparable with those for earlier months." Long story short: When Heritage compared employment numbers from October 2002 to October 2003, they improperly added 576,000 jobs.

IGNORING KEY BENCHMARKS: Heritage topped off its virtuoso distortion by claiming their faulty and distorted numbers prove that the Bush Administration's tax cuts are working. But according to the White House Council of Economic Advisors, the passage of the most recent round of tax cuts should lead to an economy that produces 306,000 jobs each month. That means that even in last two months of purportedly "strong economic growth," which produced about 125,000 jobs per month, the economy has produced around 180,000 fewer jobs than the White House promised. Just to keep pace with population growth, the economy would need to produce 140,000 jobs each month. Taking into account the 3.4% gain in population since March 2001, the economy is 6.9 million jobs short of where it would be if payroll levels had remained steady.

[1songbird]

1. Another factor that is not being

discussed is the fact that the 125,000 jobs were merely low pay service oriented jobs. The information technology industry is not recovering and it was the hardest hit by outsourcing. Manufacturing, engineering, and technology jobs are not being produced in any type of significant numbers.

[rapier]

2. notes

There is no way to change the minds of true believers.

For several hundred years the American economy has grown and produced jobs. So what else is new? The only thing new is that after 30 years of cutting taxes, during the entire time, wages and job creation are below trend. Just as bad is that profits are as low as any time in history as well. Which of course makes bussiness think first of cutting jobs and wages.

At any rate assiging a causal relationship between short term job growth and long term tax cuts is logically absurd. No matter, true believers have no use for thought.

Ideology is the enemy of thought or understanding.