"Clouds everything supply side does." Yoda - Tilted Forum Project Discussion Community

aceventura3 · 02-09-2006, 01:23 PM

From today's IBD editorial page. This should help some of you doomsday folks. I hope to soon welcome you to the...dark...I mean supply...side.

Shades are optional, but BYOB.

Quote:

Forgotten Reform

Posted 2/8/2006

...That the Bush cuts have worked is no longer in dispute. The chart tells the story of two economies: one before cuts and one after (chart shows average GDP growth of 1.12% '01 to '03 and 3.81% '03 to present). We chose to show GDP, the broadest measure of economic health. But other data points — investment, personal wealth, jobs, anything — serve just as well. All tell the same story: Bush brought the economy back to life with his bold tax initiatives.

Critics respond that the cuts also created massive new deficits. But as a news feature in IBD pointed out last week, that's not true. The cap-gains cut, for example, seems to have paid for itself in classic supply-side fashion. When the cut was approved in 2003, they assumed it would "cost" $3 billion over three years. Instead, the government took in $45 billion more than forecast.

Ditto for cuts in income taxes and other levies. Maybe one of these years, someone in Washington will connect the dots: When taxes are cut, the economy grows, creating new jobs, more income and, yes, more tax revenues...

...The record is clear. Since mid-2003, and in contrast with puny gains up until then, we've added 4.6 million jobs, $1.1 trillion in GDP, $400 billion in business investment, $738 billion in consumer spending and a whopping $12.1 trillion in personal wealth...

http://www.investors.com/editorial/I...issue=20060208

Willravel · 02-09-2006, 01:39 PM

Quote:

As of May, 2005, there have been 893,000 jobs created over the first 52 months of the Bush presidency - a gain that is due solely to the 917,000 jobs created in the government sector that offset the 24,000 jobs lost in the private sector. Since the Great Depression, no other president who served at least 52 months has overseen a net loss in private sector jobs through this point. In addition to lack of job growth, real weekly and hourly wages have declined since the start of the recession. At a time when middle-class Americans are experiencing stagnant wages and vanishing benefits, CEO pay continues to rise.
Source: Center for American Progress, Economic Policy Weekly, Jenna Churchman, June 6, 2005

Quote:

Changes in tax law since 2001 reduced federal government revenue by $870 billion through September 2005. Supporters of these tax cuts have touted them as great contributors to growth in jobs and pay. But, in reality, private-sector job growth since 2001 has been disappointing, and a closer look at the new jobs created shows that federal spending—not tax cuts—are responsible for the jobs created in the past five years.

If tax cuts have created jobs at all since 2001, it will have happened in the private sector. Assuming that job growth in 2006 matches the Bush Administration's projections, the economy will have added about 2.0 million jobs to the private sector from FY2001 through FY2006. But how many of these two million jobs actually can be attributed to tax cuts and how many to increased government spending—particularly increased defense spending—in this period?

Private-sector job growth from FY2001 to FY2006

Based on Defense Department estimates of the number of private-sector jobs created by its own spending, we project that additional defense spending will account for a 1.495 million gain in private sector jobs between FY2001 and FY2006. Furthermore, increases in non-defense discretionary spending since 2001 will have added yet another 1.325 million jobs in the private sector, for a total of 2.82 million jobs created by increased government spending. Increased mandatory government spending—which is not even included in these estimates or the accompanying chart—would account for even more job creation. The mere fact that the projected job growth resulting from increased defense and other government spending exceeds the actual number of jobs projected to be added to the economy through 2006 clearly indicates that the tax cuts hardly seem plausible as the engine of the modest job growth in the economy since 2001.

From the Economic Policy Institute

"The Republic will be reorganized into the first Galactic Empire! For a safe and secure...society!" —Palpatine, in the Galactic Senate after the killing of Mace Windu.

ObieX · 02-09-2006, 03:25 PM

What I've noticed is that a lot of these newly created jobs in the private sector are coming from companies who no longer want to employ a single person for 40 hours a week. They will instead prefer to hire 3 or 4 or even 5 people to work 5-10 hours a week. So while thre may be many more people working they are working far far fewer hours (and of course with fewer hours comes fewer benefits.)

So now instead of 1 person working at 1 store 40 hours a week, with benefits, they have to work at 4 stores at 10 hours a week per store, without benefits, to support themselves (nevermind any kind of family.) Try working that kinda stuff out with any employer who expects you to be available to them 24 hours a day 7 days a week (even though they only work you for 10 hours a week) and see how long they keep you on before dumping you for someone who they can tap at any time.

aceventura3 · 02-09-2006, 03:44 PM

Quote:

Annual changes, constant dollars, not seasonally adjusted

These estimates, in "constant dollars," showed annual compensation costs for civilian workers were -0.3 percent for the year ended December 2005, compared with a 0.5 percent over-the-year change for December 2004.
These inflation-adjusted ECI series were derived using the Consumer Price Index for All Urban Consumers (CPI-U), U.S. City
Average All Items. (See table D and the Explanatory Note for details.)

Table D. 12-month percent changes in Employment Cost Index, constant dollars,
not seasonally adjusted
......................................Dec.**Dec.**Dec.** Dec.** Dec.** Dec.
Compensation Component....2000**2001**2002** 2003** 2004**2005
Civilian workers
Compensation costs............0.7****2.5***1.0***1.9*** 0.5***-0.3
Wages and salaries............0.4****2.1***0.5***1.0*** -0.8***-0.8
Benefit costs....................1.5****3.6***2.5***4.4****3.5***1.1

http://www.bls.gov/news.release/eci.nr0.htm

Real wage growth has been weak. However...

From Job Loss and Trade.
http://www.freetrade.org/pubs/briefs/tbp-019.pdf

Quote:

...the total number of jobs in the U.S. economy is first and foremost
a function of the size of the labor force. As the population grows, the number of people in the work force grows; as the labor supply increases, market forces absorb that supply and deploy labor among different sectors of the economy.

Unemployement is currently 4.7% ten years ago it was 5.7%

Jan. 1990 there were 108,946,000,000 jobs, 18,038,000 were gov. jobs.
Jan. 2000 there were 130,387,000,000 jobs, 20,351,000 were gov. jobs.
Jan. 2006 there were 150,126,000,000 jobs, 21,775,000 were gov. jobs.

Private sector percentage rate of growth is materially higher than that of gov. But, I agree with your point that the gov. is too big a part of our economy.

http://online.wsj.com/documents/bbemp.pdf
http://www.bizstats.com/employment.htm

Personal income in 2000 was $8,260,842 (in millions) in 2005 it was $10,260,723. Personal income includes income from all more inclusive than wages. That is a 24% increase in 5 years. This still excludes unrealized capital gains. For example the secretaries at Microsoft, Cisco, or Dell, etc, who got stock options rather than salary increases and who are now millionairs, that growth in wealth is not reflected in your statistics or mine.
http://www.bea.gov/bea/regional/sqpi/action.cfm

"Lost a planet, Obi Wan has", Yoda

02-09-2006, 03:25 PM	#3 (permalink)
ObieX Pickles Location: Shirt and Pants (NJ)	What I've noticed is that a lot of these newly created jobs in the private sector are coming from companies who no longer want to employ a single person for 40 hours a week. They will instead prefer to hire 3 or 4 or even 5 people to work 5-10 hours a week. So while thre may be many more people working they are working far far fewer hours (and of course with fewer hours comes fewer benefits.) So now instead of 1 person working at 1 store 40 hours a week, with benefits, they have to work at 4 stores at 10 hours a week per store, without benefits, to support themselves (nevermind any kind of family.) Try working that kinda stuff out with any employer who expects you to be available to them 24 hours a day 7 days a week (even though they only work you for 10 hours a week) and see how long they keep you on before dumping you for someone who they can tap at any time. __________________ We Must Dissent.