Tag Archive for 'New York Times'


A blast from the past

Back in June of 1987 (!), the New York Times interviewed Edward W. Kelley Jr. just as he joined the Federal Reserve’s board of governors.  How’s this for a quote?:

Q. Mr. Volcker has been considered something of a foot-dragger on bank deregulation. Where do you stand?

A. I’m philosophically in favor. The deregulation we’ve had over the last few years has been highly beneficial and I would favor further deregulation of the financial services industry. But there’s an overriding public interest in making sure the integrity of those types of institutions is maintained. I really do not want to run any meaningful risks that we deregulate at a speed or in a way that would imperil that.

Brilliant!

[Hat tip to my new favourite blog (ok, so I’m two years behind the times), Economics of Contempt]


Perspective

Everybody’s wringing their hands over the fact that the US economy suffered a net loss of 533,000 jobs in November.  That’s an awful lot and it’s gotta hurt.  Most media outlets are also observing that it’s the worst month for employment since 1974.  Here is the Wall Street Journal:

The U.S. lost half a million jobs in November, the largest one-month drop since 1974, as employers brace for a recession that’s expected to stretch through much of 2009.

The New York Times:

The nation’s employers cut 533,000 jobs in November, the Bureau of Labor Statistics reported Friday.

Not since December 1974, toward the end of a severe recession, have so many jobs disappeared in a single month — and the current recession, far from ending, appears to be just gathering steam.

These facts are true, but they’re also misleading.  There are two important things that nobody that I can see is mentioning:

Firstly, the population of the USA has grown by over 43% in the last 34 years.  In 1974 the resident population was 213 million.  Today it is 306 million [source].  Losing half a million jobs in 1974 was a much bigger event than it is today.

Secondly, a much greater share of households only had one source of income in 1974 compared to today.  Back then, if the sole worker lost their job, the family was in serious trouble.  Today, if one of the (more often than not) two workers in a household loses their job, the family still suffers but far less than they would have back then.

Both of those will be cold comfort to anyone losing their job, but when watching events at a macroscopic level – looking at the country as a whole – it’s important to keep some perspective.

As a side note:  The entry of women into the workforce will have served to reduce at least the scale, if not the likelihood, of a catostrophic loss of income to a household in the sense of Carroll (QJE 1997) (the paper is downloadable here).  What work has been done investigating the links between female participation rates (or, more generally, the number of workers per household) and the extent of buffer-stock saving?

Update:

Paul Krugman looks at the ratio of employed people to total population:

Calculated Risk looks at the Year-over-Year percentage change in employment.

You’ll note, though, that they are both bloggers and not mainstream media.


Not-at-all-surprising events #437

The NY Times endorses Obama:

Hyperbole is the currency of presidential campaigns, but this year the nation’s future truly hangs in the balance.

The United States is battered and drifting after eight years of President Bush’s failed leadership. He is saddling his successor with two wars, a scarred global image and a government systematically stripped of its ability to protect and help its citizens – whether they are fleeing a hurricane’s floodwaters, searching for affordable health care or struggling to hold on to their homes, jobs, savings and pensions in the midst of a financial crisis that was foretold and preventable.

As tough as the times are, the selection of a new president is easy. After nearly two years of a grueling and ugly campaign, Senator Barack Obama of Illinois has proved that he is the right choice to be the 44th president of the United States.