GayPatriot

The Internet home for American gay conservatives.

Rigging the GDP statistics

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I’ve commented before on how the government has changed its methods over the years for calculating the economic stats, to make itself look better.

For example, consumer price inflation has been running about 8-9% per year under the 1980 method. I don’t claim the 1980 method is right; but the government claims only 1% CP inflation from its newer methods, and that number violates many people’s first-hand experience of rising prices and declining living standards.

Or with unemployment: by 1930s methods, it has been running 15-20%, which means we are already in the Great Depression 2.0. Again, I don’t view the older method as sacred; but that number fits many people’s experience better (as they have been forced into permanent unemployment, part-time work, etc.) than the government’s claim of 7.4% unemployment.

The people who change the statistical methods always have excellent-sounding reasons. There’s just one problem. Their changes always run in one direction, to make the government look better.

Somehow, they never adopt changes that could make things look worse. The latest example is GDP (Gross Domestic Product). Last week, the government published new data from new formulas for calculating GDP.

Guess what? The changes make the government look better. Suddenly, America’s GDP is supposed to be $550 billion higher. Which improves America’s debt-to-GDP ratio magically; that is, even though nothing has changed in reality.

But some of the changes they made are unreal, almost too silly to believe. The first ZH link above provides neutral-sounding descriptions from Bloomberg. Peter Schiff gave clearer and more colorful descriptions, in a preview back in April: [Read more…]

“4 in 5 in USA face near-poverty, no work’

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…at some point in their lives. From an AP / USA Today article earlier this week:

Four out of 5 U.S. adults struggle with joblessness, near-poverty or reliance on welfare for at least parts of their lives…

Survey data exclusive to The Associated Press points to an increasingly globalized U.S. economy, the widening gap between rich and poor, and the loss of good-paying manufacturing jobs as reasons for the trend.

More than one angle here is worth exploring, and I may do so in future posts. But for now, I’ll try to keep it brief.

Most obvious (and important) is the simple failure of President Obama’s economic policies. It’s not a matter of giving him more time; he’s had more than four years. The problem is that his policies can never work, because they are the wrong policies.

As a committed leftist, the man simply does not understand how the real economy works, how the American middle class came to be, or what produces good jobs and rising living standards for large masses of people.

Obama gave a speech on the middle class this week which was as misguided as any he’s given, and which I may review later in more detail. For now, let’s just say that Obama’s Big Government, debt-inflating policies are the thing causing the conditions that he decries (rising wealth inequality, loss of manufacturing jobs, etc.).

Another possible angle, on the above article, is race – specifically, “the stupidity of race” (as I almost titled this post). Because it goes on to be fairly obsessed with race, saying: [Read more…]

Today’s history lesson: Eighty years ago…

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Via The Circle Bastiat. Franklin D. Roosevelt, greedy to increase his power over Americans’ economic lives, confiscated their gold bullion & currency. People who wanted to keep their own money (because gold and gold-backed notes had circulated as U.S. money, until then) were labeled “slackers” and “hoarders”, then prosecuted:

New York Times, 6/12/1933, on gold 'hoarders'
You can see a clearer, larger image of the article here. Those who cooperated received, for the most part, only partial compensation (paper dollars which Roosevelt then devalued, the next year).

Such a confiscation would have been unthinkable to America’s Founders. They revolted against King George III for less. Are property confiscations part of America’s future under Obama? Time will tell.

After establishing the Constitution, the Founders fixed the U.S. dollar as being just under 1/20 oz. of gold, because paper-money experiments during the Revolutionary war had taught them that sound money was a crucial element of a sound, free and prosperous society. That 1/20 oz. value guided the American economy for roughly 140 years, through the greatest net economic expansion in human history.

Beginning with Roosevelt (who, again, confiscated the gold dollars, then devalued the paper ones from an official gold value of 1/20 oz. to around 1/35 oz.), the dollar’s value has dwindled, as the government taxes us all covertly by printing more and more money.

Americans regained the right to own gold bullion in 1974, but the dollar has remained mere paper. On average (or with some ups and downs), its value continues to dwindle. The dollar’s market value in gold was roughly 1/250 oz. when Bush 43 took office, 1/800 oz. when Obama took office, and is near 1/1300 oz. today.

I believe that further depreciation is to come.