What I like most about this Pants on Fire ruling from PolitiFact is that Michele Malkin’s website promoted it. The Michele Malkin, the not as tightly controlled Michele Bachmann, who proclaimed that PolitiFact was nothing but “opinion journalists who masquerade as neutral arbiters of fact." Apparently that doesn’t apply when their most illustrious and popular ruling is being awarded to Democrats like Harry Reid for his recent statement in a senate speech that there was a loss of eight million jobs during the Bush years.
The stock market is considered a leading indicator of macro-economic changes, while job losses are a lagging indicator, that is, as described in “A Beginners Guide to Economic Indicators”: (emphasis added)
…A lagged economic indicator is one that does not change direction until a few quarters after the economy does. The unemployment rate is a lagged economic indicator as unemployment tends to increase for 2 or 3 quarters after the economy starts to improve.
If that’s true, the economy started to tank early in 2008, and then unemployment followed. If we are to view this by quarter as a lagging indicator, it would be fair to say that the first quarter of 2009--at a minimum--belonged to Bush. How was employment through just the first quarter, that is, since the loss of employment started in 2008? From CNN Money: (emphasis added)
For the first three months of the year [2009], 2 million jobs have been lost, and 5.1 million jobs have been lost since the start of 2008.
To put the three-month loss in context, if no more jobs are lost over the next nine months, 2009 would still be the fourth worst year for job losses since the government started tracking the number of workers in 1939.
If we use the percent rate we can get a better handle on the increase in unemployment between Bush and Obama. It went from 4.2% in January of 2001 to 7.8% in January of 2009, an increase of 85%, a straight calculation not considering lagging by extending it through the first quarter. That compares to the current unemployment rate at 9.1%, which was a 17% increase since Obama took office in January, 2009. In other words, the increase in the unemployment rate under Bush was five times that of Obama.
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| Note highlights in this Excel capture of monthly unemployment rates from start of Bush term until August, 2011. |
Yes, Harry Reid exaggerated the amount of the job losses under Bush. However, the majority of job losses did indeed occur during Bush’s administration. Even by deducting for the million-plus jobs created under Bush, it was still about half. And PolitiFact’s Louis Jacobson more or less said as much: “The loss of eight million jobs occurred during a roughly two-year period shared more or less equally between Bush and Obama.”
When you consider unemployment as a lagging indicator, however, Bush should be held more accountable. And of course, to use some of my conservative counterpart’s “bankrupt” thinking, we could also say the underlying argument is that, as Harry Reid put it, “if the tax cuts were so good, the economy should be thriving.” Those tax cuts, of course, definitely belong to Bush, particularly as a matter of economic policy.
Of course, if Jacobson recognized it as such, then the employment numbers Reid quoted for Clinton are off as well, as the unemployment rate started to increase as soon as Bush took office. Even so, Clinton was still far ahead of Bush in job creation, and did it with tax increases, which was part of what Reid was trying to point out. And that is something Jacobson can fact-check: did the number of jobs increase despite tax increases on the most wealthy when Clinton was president, and did unemployment increase despite taxes being cut by Bush? While some may say it’s not cause and effect, there certainly appears to be a correlation.
So we really have a plausible Half True, at a stretch Mostly False statement, with an accurate underlying argument which was wholly disregarded, and no recognition given to the consequence of unemployment as a lagging indicator. Jacobson needed to look at this in more terms than just BLS data. And it was not a statement you could consider absurd or ridiculous. If that’s the case, I could use another argument often put forth by my conservative counterpart: it was merely hyperbole and should have been recognized as such. Maybe Harry Reid should have taken a cue from Jon Kyl and put it on record that it was not meant to be a factual statement.
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