HOGWASH: “I simply make the point, as an editor might say, to check it out; do not buy into the BS that you hear about spending and fiscal constraint with regard to this administration. I think doing so is a sign of sloth and laziness.” — White House spokesman Jay Carney, May 23, 2012.
Carney was referring to a much-talked about piece of partisan journalism by Rex Nutting at MarketWatch, which claimed that the “Obama spending binge never happened.” This ludicrous claim was quickly and thoroughly debunked.
Carney suggested the media were guilty of “sloth and laziness,” but he might do better next time than cite an article he plucked off the Web, no matter how much it might advance his political interests. The data in the article are flawed, and the analysis lacks context — context that could easily could be found in the budget documents released by the White House.
SMALLER GOVERNMENT, MORE GROWTH: A new study from the Centre for Policy Studies finds that smaller government equates to enhanced growth in advanced countries, claiming to debunk the European “austerity” myth perpetrated by many - most famously, by one-time economist Paul Krugman.
On a related note, Business Insider’s Michael Brendan Dougherty claims that Mitt Romney admitted during a Time Magazine interview that cutting spending would hurt the economy:
Halperin: Why not in the first year, if you're elected — why not in 2013, go all the way and propose the kind of budget with spending restraints, that you'd like to see after four years in office? Why not do it more quickly?
Romney: Well because, if you take a trillion dollars for instance, out of the first year of the federal budget, that would shrink GDP over 5%. That is by definition throwing us into recession or depression. So I'm not going to do that, of course.[emphasis mine]
It couldn't be clearer: Mitt Romney believes that a large cuts to federal outlays will throw us into a recession or depression.
Actually, it could be a lot clearer. Romney goes on to say that he believes immediate large cuts to federal outlays would throw us into a recession, not that cuts can't be achieved in relatively short order. Here's the full quote:
Romney: Well because, if you take a trillion dollars for instance, out of the first year of the federal budget, that would shrink GDP over 5%. That is by definition throwing us into recession or depression. So I’m not going to do that, of course. What you do is you make adjustments on a basis that show, in the first year, actions that over time get you to a balanced budget.
BRUTAL: A study by USA Today finds that if government used standard accounting rules to measure the deficit it would look something like this:
The deficit was $5 trillion last year under those rules. The official number was $1.3 trillion. Liabilities for Social Security, Medicare and other retirement programs rose by $3.7 trillion in 2011, according to government actuaries, but the amount was not registered on the government's books.
BAIN: Here's Mark Thiessen on the administration's record on private equity (and don't forget this.). And here's an excellent piece by Noah Smith on private equity plays and productivity:
And although American critics of private equity have valid points, I think they should look to Japan before they denounce the role that Bain Capital and company have played in our economic and social development. By all means, change the tax code to discourage private equity companies from over-leveraging their acquisitions. Close the carried interest loophole. Create re-employment services to help the workers laid off in restructuring. But for pete's sake, don't wish that our corporate culture was like Japan's. You wouldn't like it.
FACEBOOK IPO: What the %$#! happened? A useful explainer about the unfolding Facebook drama. Luckily, as a 99%-er, I don’t have to worry much about massively overvalued stocks.
CHINA: Both presidential campaigns are playing the protectionist on China (no doubt, it polls well).
In other news: After Barreling Ahead in Recession, China Finally Slows:
Though the Chinese economy continues to expand, construction workers are losing jobs in droves and retail sales grew last month at the slowest pace in more than three years. Investments in fixed assets have increased more slowly this year than in any year since 2001.
It's going to be bad news for the global economy if we add a recessionary China into mix.
