The Choice: Math vs. Anti-Math in Fiscal Policy

Over a hundred and fifty years ago, the “Know Nothing Movement” rose to prominence in American politics. The “Know Nothings” were thusly known not because they were ignorant, but because they denied being adherents of a xenophobic, nativist party. But I think this time around, it is appropriate to characterize one group as being a true “Know Nothing” party in the sense that they reject the gifts of the Enlightenment.

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The October Employment Situation: Continued Improvement

Figures 1 and 2 illustrate the improvement in nonfarm payroll and private nonfarm payroll employment, respectively. Figure 3 highlights the fact that total civilian employment and labor force both increased in October. Interestingly, civilian employment growth in October continues that reported for September, the veracity of which some observers had questioned.

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The Employment and GDP Relationship

The latest GDP release gives me the opportunity to re-evaluate whether job creation is less than what would be expected, given the growth in real GDP. At first glance, it seems obvious that growth in employment is less than expected. A simple OLS regression of log private employment on log real GDP over the 1987Q1-2012Q3, which might be implied by a particular form of Okun’s Law.

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Why Governor Romney’s Threat on the Chinese Currency Matters

Maybe. Governor Romney has stated that he will declare China a currency manipulator on Day One, should he be elected President. In contrast to his other policy positions – from tax rates on the upper incomes, defense spending, coverage of pre-existing health conditions, the Blunt Amendment, Afghanistan timetable, first strike on Iran – he has exhibited remarkable (and pretty unique) constancy in his desire to call China a currency manipulator. In fact, one can find news reports from 2007 onward attesting to this long-standing stance [1], [2], [3]; so if there is any promise we should believe he will follow through on, it’s this one. And from Believe In America: Mitt Romney’s Plan for Jobs and Economic Growth (under “Day One”), it is:

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