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Home Publications Blogs Beat the Press Obama Says He Just Found Out How Bad the Economy Was in 2008, Where Is the Ridicule?

Obama Says He Just Found Out How Bad the Economy Was in 2008, Where Is the Ridicule?

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Saturday, 27 August 2011 08:10

The media love to jump on politicians when they say something stupid or inaccurate about their personal lives.They will fill pages and pages of print, and take up hours on radio and TV, talking about the comment. They will bring on experts (i.e. political reporters and gossip columnists) to tell the public what the gaffe means and why it makes that person inappropriate for elected office.

However they somehow don't get the same urge when a political figure makes an incredibly foolish remark about a policy matter. This is striking because most people are perfectly competent to assess the appropriateness of a statement about a personal matter based on their own lives' experience. In other words, they really don't need the "experts" to tell them how important or unimportant a particular remark is. On the other hand, most people do not have expertise in the various areas of public policy, so they could benefit from having an expert tell them when a political figure makes an especially off the wall comment.

In that spirit, the Washington Post absolutely should have included a heavy dose of expert ridicule when it reported that President Obama said:

“I have to admit, I didn’t know how steep the climb was going to be. Because we didn’t realize — we just found out a week ago that the economy that last few months in 2008 was even worse than we had realized.”

It is true that the Commerce Department just revised down the GDP data to show that the decline at the start of the recession was even steeper than had previously been reported. However, by far the most meaningful measure of the steepness of the climb needed for recovery is the employment to population ratio (EPOP):the percentage of the working age population with jobs. This is reported monthly and is not subject to substantial revision.

President Obama's team always knew exactly how far the EPOP had fallen since the start of the downturn and therefore knows how many people must be put to work to get the economy back to full employment. The lower than previously reported GDP is an interesting piece of information, but tells us almost nothing new about how much ground must be made up. 

The Post should have included the comments of economists ridiculing the idea that President Obama has just now discovered how bad the downturn was. It might even be worth a separate article or two. If the statement is actually true (i.e. President Obama just realized how bad the downturn was) then it is deserving of far more attention than his comment about working class whites being bitter and clinging to gun and religion before the Pennsylvania primary.

Comments (14)Add Comment
Obama Strikes Compromise with Irene to Put Less Houses Underwater
written by izzatzo, August 27, 2011 10:47
On the other hand, most people do not have expertise in the various areas of public policy, so they could benefit from having an expert tell them when a political figure makes an especially off the wall comment.


Weather expert Hurricane Alley Oop noted that while it's not possible to negotiate with a hurricane Obama should be commended for offering to accept maximum wind damage only as a compromise since too many houses are underwater already from mortage floods.

Stupid liberals.
..., Low-rated comment [Show]
The Circus Rule
written by Ron Alley, August 27, 2011 12:24
In 2008 I was excited about the prospects for an Obama presidency. Honestly, I was fooled. As 2012 approaches, I find myself thinking that I will not be fooled again. Remarks such as this only strengthen my conviction.
...
written by denim, August 27, 2011 1:33
“I have to admit, I didn’t know how steep the climb was going to be. Because we didn’t realize — we just found out a week ago that the economy that last few months in 2008 was even worse than we had realized.” Obama.
So did he have his fingers in his ears? Reminds me of the three money statue. Only with this changey thing:
Hear no Krugman, See no Baker, Do no Delong.
Well, he does live in Washington
written by Lord, August 27, 2011 3:07
Employment there has been doing really swell. Maybe they should get out once in a while.

...
written by Walter_R, August 27, 2011 3:29
I doubt Obama's statement is actually true. It's just an excuse for his poor performance on the economy.
...
written by PatR, August 27, 2011 3:32
It's fascinating how some readers parlayed Dean's request to the commentariat to point out dumb errors in economics by our leaders into a campaign call for a vote for one of the two teams in our friendly game of politics. For some people, knowing and publicizing the facts is subordinate to supporting the team. It's why our modern US political discourse is completely pointless. Hopefully Mr Baker can succeed at injecting some objective and meaty discourse into economics.
...
written by Kat, August 27, 2011 3:45
"President Obama's team always knew exactly how far the EPOP had fallen since the start of the downturn and therefore knows how many people must be put to work to get the economy back to full employment."

Um, are we now defining full employment as whatever the level was just before the start of the last recession?
...
written by skeptonomist, August 27, 2011 4:27
Obama's comment pertains to the outlook in late 2008-early 2009, and to the growth potential of the economy. If GDP had not fallen so much, and more to the point if it had recovered at a greater rate, unemployment would be much lower now. Decisions made at that time depended largely on forecasts from standard economic models, which turned out to be far too optimistic. The economy did begin to recover in early 2009, but the recovery has been much slower than in previous recessions. No, the depth of the fall in employment did not inevitably predict the slowness of the recovery. One thing which might have is the collapse of housing (did those models include the fact that housing had been destroyed?), but basically banks have prevented any real action to clear that mess up.
...
written by Jethro, August 27, 2011 5:17
What is really fascinating is that some people write what they think is witty, and no one has a clue what Patr is talking about.

To some it is a game to played and the result is nothing much has been accomplished, but words to be forgotten.
...
written by beth, August 27, 2011 5:22
I would just add a thought to skeptonomist's post- banks have done little to nothing to help the regular people who want to start new business by not lending.

Powerful opposing forces to economic recovery are responsible for obstructing this nation. Whether it's for profit or politics, the economic situation of millions of Americans is no less dire than if the Hurricane Irene event continued for years.
...
written by beth, August 27, 2011 5:33
PatR said "It's fascinating how some readers parlayed Dean's request to the commentariat to point out dumb errors in economics by our leaders...".

I did miss that call. Pres O is not an economist. His advisors, Treasury, the Fed, and Congress bear the responsibility for not communicating (or knowing?) the overall truth in my view. The "experts"failed or misled this entire nation.

There's been Nothing that's not been critical state for this President and the nation to deal with for the last 11 years, in my opinion.
Dick Gephardt
written by Guest, August 27, 2011 9:54
We thought we electing something new and exciting. But we were really only electing Dick Gephardt, a standard inside-the-Beltway Democrat, and a not very imaginative one even by that standard. It's amazing, given Obama's resume, what a dullard he actually is.

I will not vote for him again. If the economy improves, he will not need my help. If the economy stays in the tank, nothing I can do will help him.
Perry, Bachmann will calculate the area under the curve
written by Crown of Balls, August 30, 2011 12:36
When confronted by these stories of Obama ignorance, I am comforted in knowing that Perry and Bachmann will know what to do with an EPOP and a GDP.

Stupid liberals

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About Beat the Press

Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.

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