Reality Checks: 10 Economic Benchmarks For the State of the Union And GOP Response

[Donnachaidh]

http://www.smirkingchimp.com/thread/rj-eskow/33879/reality-checks-10-economic-benchmarks-for-the-state-of-the-union-and-gop-response

Tonight the President gives his State of the Union address, followed by the Republican response from Rep. Paul Ryan. There'll be a lot of talk about the economy: jobs, taxes, deficits, and the state of American business. If you find that your mind's getting lost in vagaries and theories, here are ten "reality checks" to bring you back to earth, benchmarks that provide a context for tonight's speeches:

1. The Federal government isn't a runaway fiscal monster.

You'll probably hear Rep. Ryan say that the United States government is relentlessly devouring everything in its past, consuming an ever-greater portion of our national prosperity. The President may even echo this notion, in a milder way. But it ain't so:

:snip:

As the Joint Committee on Taxation documented, Federal taxes have been stable as a percentage of our GDP for a long time. Even a projected uptick in this figure leaves us pretty much where we've been all along. It's a needed corrective to the reckless tax giveaways of the last decade -- - and some of that revenue increase is needed because of the crisis caused by banking deregulation.

2. Main Street and Wall Street aren't "in this together."

Let's hope there's no more Presidential talk about how "Wall Street and Main Street rise and fall together." That was never less true than it is today, and the numbers prove it: The GDP is up 4% - but the stock market's up 24%. Barry Ritholtz thinks that's due to Federal Reserve policy, and that sounds right. If you can get cheap low- or no-interest loans, it's pretty hard not to do make out pretty well in the stock market.

If that's true - and we have no way of knowing, since your Federal Reserve operates in secrecy - the bankers once again have the taxpayers to thank for their extraordinary success. And, as Ritholtz explains, that could include several trillions in wealth that was artificially created by the publicly created Fed.

The stock market's grown at six times the rate of the real economy. The financial sector has become untethered from physical reality. Stop looking for the intersection where Main Street meets Wall Street. They're not even in the same town anymore.

3. The bankers who created this crisis are doing great.

More at the link --