Outside the Beltway

Official White House Photo by Molly Riley

Checking on the Economics President’s Economy

The new job numbers are out.

Steven L. Taylor
22

Comments

CNBC reports: Labor market faltered in September as jobs increased by just 29,000, unemployment rate rose to 4.2%.

Nonfarm payrolls rose a seasonally adjusted 29,000 for the month while the unemployment rate increased to 4.2%, the Bureau of Labor Statistics reported Friday. Economists surveyed by Dow Jones had been looking for job growth of 84,000 and an unemployment rate of 4.1%.

In addition to the weakness in September, the August jobs count was revised lower to reflect a gain of 133,000 while July switched from a gain to a loss as payrolls fell by 10,000. The revisions in total showed 60,000 fewer jobs than previously reported.

The NYT has a chart:

I don’t think I even have the energy to be snarky about this this morning, and will simply note that, while rather obviously, the president is not directly responsible for how many jobs are created, the current occupant has engaged in a number of policies that have been detrimental to the overall economy. The most prominent being tariffs and unnecessary trade wars, alongside a spectacularly stupid war in Iran.

It seems worth noting that we would have neither trade wars nor a war in the Strait of Hormuz if Harris had won the election, or if Trump had simply maintained the basic policies of the Biden administration.

But, as the saying goes, elections have consequences, and anyone who voted for Trump because he was going to be good for the economy was simply wrong.

For example:

And via Krugman:

But sure, the guy whose biggest business ideas are changing the names of things and/or putting gold paint on them is the person we wanted making global-scale policy decisions. (Ah, I see the snark came back without me even looking for it.)

Categories

,

Tags

, , , ,

22 responses to “Checking on the Economics President’s Economy”

  1. Daryl Avatar
    Daryl

    It’s often said that there’s actually little the POTUS can do to affect jobs or the cost of things.
    Turns out there is plenty the POTUS can do to HARM those things.
    FATSO is the worst jobs President in history. And it’s his own damn fault.

    2
  2. gVOR08 Avatar
    gVOR08

    If Dimbulb had just sat on his hands in the Oval we’d have a good economy right now and he’d be getting credit for it.

    And speaking of the Oval, he’s supposedly talking about making it a national landmark as-is so his successor can’t redo his Temu gilt decor.

    1
    1. Moosebreath Avatar
      Moosebreath

      “And speaking of the Oval, he’s supposedly talking about making it a national landmark as-is so his successor can’t redo his Temu gilt decor.”

      Which is pretty funny coming from someone who is fine with making changes to other national landmarks without obtaining approvals.

    2. Jen Avatar
      Jen

      He can pound sand. I sincerely hope whomever comes next has all of that sh!t removed before the moving van exits WH property.

      We’ve all seen that it’s okay by the Supreme Court to ignore stuff you don’t like, so removing the Libyan Dictator Chic decor should be priority #1.

      2
      1. JohnSF Avatar
        JohnSF

        I wonder if Trump realises how many foreign visors are having to bite their hands hard not to burst out laughing at the vulgarity of it?
        Even the Emirati’s probably think its being laid on a bit thick.

        “But some bits of Buckingham Place and the Elysee look similar …”
        Indeed; but they were inherited from rather gaudy 18th century monarchs, and at least they are genuine gold leaf, lol.

        2
  3. Gavin Avatar
    Gavin

    Since Reagan, about 52 million jobs have been created in the US.
    50 million of those were during Democratic administrations.

    It’s a fact that Republicans are terrible at managing the economy.

    And this should be expected — all Republicans do is parrot the things the top 0.1% tell them.. and Musk is typical of those. He’s too weird for the pedophile parties at Epstein island, he’s had a daily drug addiction for over a decade, his only skill is scamming people… and Republicans think this guy is smart.

    1
    1. gVOR10 Avatar
      gVOR10

      It makes me crazy that Republicans have long been more trusted on the economy, at least until a few months ago. The numbers all say the opposite. Economists have long recognized this correlation, but struggled with it, as they don’t see macroeconomic differences to explain it. I tend to see it as small ball in the agencies, a vibe that restrains the 0.01%, fewer wars, and fewer stupid tax cuts. GOPs explain it as Ds inheriting good economies, but if you lag it a year, the correlation is stronger. If anything, Biden and Obama fixed bad economies they inherited.

      I’ll add a concession that Musk is smart. But his adherents claim he’s a genius. A biographer claimed to have his SAT scores. Good, but one-in-a-hundred good, not one-in-a-thousand good. And yes, he’s mostly a really good con artist.

      1
      1. MarkedMan Avatar
        MarkedMan

        It turns out that Musk was once really good at finding companies and founders that had really great ideas and the ability to execute, buy that company, and then motivate the hell out of them. Tesla is the prime example. The two really interesting and revolutionary cars they made, the Roadster and the Model S, were in the pipeline when he got there. And, if I recall correctly, the Model 3/Y was far along. The first thing he came up with on his own was the Cybertruck and that has been an epic disaster. And I do mean epic. I looked up the numbers and it is an order of magnitude worse than the Edsel

        3
        1. gVOR10 Avatar
          gVOR10

          I refer to Musk’s weird pickups as Ciphertucks. I saw someone else suggest Klanborghini.

          1
      2. JohnSF Avatar
        JohnSF

        Bill Clinton was arguably the most effective US president in economics since Eisenhower.
        Though there is an argument to be made that he was a bit complacent about the impacts of globalisation with China gaming the system.
        But then, that also applies to both Bushes.

        Musk is an odd duck, by any non-fanboy judgement.
        He has a knack for spotting opportunities for massive growth and leveraging it (PayPal, Tesla, SpaceX/Starlink) and driving expansion.
        But often seems to run into problems when he gets free rein to indulge his hobby-horses.

        1
      3. Barry_D Avatar
        Barry_D

        “It makes me crazy that Republicans have long been more trusted on the economy, at least until a few months ago. ”

        The GOP is good for the 1% of the 1%, and they buy the propaganda.

        1
  4. DK Avatar
    DK

    I miss Joe Biden.

    3
    1. JohnSF Avatar
      JohnSF

      I still think the turning point of disaster of our times was Hilary Clinton’s defeat in 2016.
      Yet she won the popular vote!
      Speaking as a damn furriner, the Electoral College system seems a little bit silly.
      And unfortunate in its consequences.

      2
      1. Eugene Avatar
        Eugene

        I’d certainly agree that the EC may well always have been a silly idea, but I think it’s importance is that it was essential in keeping the election of the head of state in the hands of the aristocracy of the times while preserving the illusion that “we, the people” were doing the electing.

        Cue the smoke and mirrors.

        1
        1. JohnSF Avatar
          JohnSF

          State separation and parity in authority makes eminent sense in the EU, as it is a confederation of sovereign states.
          In the US, which is supposed to be federal system on a democratic basis, not so much.

          1
  5. nightpain42 Avatar
    nightpain42

    The “50 million out of 52 million jobs” is a blatantly partisan talking point that serves as a textbook example of how cherry-picking dates and ignoring recession timing distorts reality (and does nothing to further discourse)

    ​You conveniently begin right after Ronald Reagan left office. If you actually start “since Reagan” took office, you have to add back 16M jobs created under a Republican.

    ​Tallying raw job additions rewards presidents who inherit a recession trough and punishes those who leave office during an exogenous crisis. A huge portion of Obama’s job numbers were simply digging out of the 2008 collapse (employment didn’t surpass its pre-recession peak until 2014), and roughly 10M jobs under Biden were workers simply returning after 22M jobs vanished in 2mos during the COVID lockdowns.

    ​Digging deeper (people using actual statistics), a 2014 Princeton study, “Presidents and the U.S. Economy: An Econometric Exploration,” confirmed that while Democratic administrations show higher raw growth numbers, the gap is overwhelmingly driven by macroeconomic luck and external timing, not executive policy. Here are the relevant quotes:

    ​“The Democratic edge stems mainly from more benign oil shocks, superior total factor productivity (TFP) performance, a more favorable international environment, and perhaps more optimistic consumer expectations about the near-term future.”
    ​“Our empirical analysis does not attribute any of the partisan growth gap to fiscal or monetary policy.”
    ​“It seems we must look instead to several variables that are mostly ‘good luck,’ with perhaps a touch of ‘good policy”

    ​Real world examples of exogenous shocks (not a full list): COVID, the Russian invasion, the 1973 OPEC oil embargo, Britain devaluing the pound, the Iran-Iraq War, 9/11, the 2008 financial crash, etc

    ​Counterexamples of “luck”: Post-WWII (only untouched economy), the Internet boom (I guess Al Gore invented), the shale revolution, Baby Boomers entering the workforce, AI

    ​Presidencies don’t operate in a vacuum. Claiming so ignores business cycles, global supply shocks, demographics, and the Federal Reserve’s rate decisions

    ​Therefore, I agree with Steven: “The president is not directly responsible for how many jobs are created.”

    (Btw I’m sure to get some flack, but cards on the table, I haven’t voted for a Republican since 2004 and this coming November will be all “D”‘s)

  6. JohnSF Avatar
    JohnSF

    Meanwhile, the bond markets are looking as sick as the proverbial parrot, thus pushing up interest rates and cutting into the US budget fiscal headroom.
    The G7 emergency meeting agreed to release 100m barrels of diesel reserves; which is like trying to piss on furnace, so long as the Gulf diesel supply remains choked.

    The US administration drove this in part by threats to block diesel exports. Which is likely to be political crowd-pleaser with a lot of Americans.
    But if you look at the details of the consequences of actually doing so, problems arise.
    Due to limits on US diesel demand and transport and storage issues, refineries would likely have to reduce diesel production. And that in turn would reduce the other products, until refineries could be rejigged, which takes time. Thus almost certainly increasing prices of gasoline.
    While surplus crude gets diverted to export.

    International increases in diesel prices meanwhile increase global inflation, leading to reduced demand for US exports, and likely rises in central banks interest rates.
    Which in turn feeds into upward pressure on US rates.

    Also it will increase the tendency in other countries to view the US as an unreliable partner in trade, economics, and strategy.
    The obvious response would be, in the medium-term, to shift hydrocarbon contracts away from US suppliers.

    In short, it’s a brilliant plan.
    So long as you are a dimwit.

    So expect Trump to enact it sometime next week.
    eyeroll

    2
  7. Kathy Avatar
    Kathy

    The Taco white house is using the jobs report to claim the reindustrialization agenda is working.

    They also claim wages are up, though they haven’t kept up with inflation.

    Let no one forget El Taco loves the inflation.

    1
    1. JohnSF Avatar
      JohnSF

      “Just believe, and all shall be well, and all shall be well, and all manner of things shall be well.”
      Perhaps the basic premise of Trumpism is the longing to live in an alternative, and subjectively more congenial, reality.

      Ironically, Trump may indeed drive the global on-shoring of industry, in unwitting partnership with Xi.
      Though it’s highly unlikely to bring much benefit in jobs, and by economic inefficiency to reduce middle-class living standards.

      The causation, imuho, being the ironic convergence of the CCP’s utter inability to refrain from pushing gaming the trading system to the limit and beyond.
      And the rather insensate determination of the American financial systemic drive to engross all possible gains, and the merry cooperation of many politicians in that rather short-sighted game.

      1
      1. Kathy Avatar
        Kathy

        In a way it’s too bad.

        It would have been nice to know what happens when the mythical factory jobs return, and the MAGAts and any actual republicans still in existence find out they don’t pay nearly as well as union factory jobs.

        1
        1. JohnSF Avatar
          JohnSF

          The experience of manufacturing is that jobs tend to decline even if production increases.
          UK relative manufacturing output now, by value, is roughly double what it was in the 1990’s.

          I remember back in the 1980’s the new West Works body welding area at Austin-Rover Longbridge, which was almost entirely automated.
          And the trend has continued.

          Unless you can source labour at minimal wages, automation is going to eat jobs.

          So even if factories return, there will be damn few jobs.
          The 1950’s/60’s period of relatively highly paid positions in manufacturing for relatively less skilled labour is gone.

          There is, and will likely always be, demand for skilled and adaptable craftsmen.
          But not for the old-style semi-skilled assembly line jobs.

          2
  8. Ken_L Avatar
    Ken_L

    Substantial revisions to previous months prove once again how meaningless these hastily-compiled monthly releases are. They are so inaccurate they actually do more harm than good for anyone who uses them to make policy decisions. It’s past time the BLS scrapped the whole system in favour of more rigorously researched quarterly data.

    1

Latest Posts