One thing I've always found interesting about economics is that the economists, even those who are PhD level professors always have different future and forward-looking projections and predictions than their fellow economic colleagues.
They all have the same data to use, but they choose to interpret it differently.
Might I suggest that it is not an exact science, and there are many different theories and each economists uses versions of these to propel their best guess.
Might I also suggest that much of this data and the results are manipulated in order to achieve a certain predestined answer? Okay so let's talk about this shall we? Recently, we've seen some rather bizarre economic news which certainly doesn't fit into the picture.
Sure, one could surmise that we are in an election year and we are getting very close to the election.
Therefore the Obama Administration wishes to make sure that there are favorable numbers hitting news.
Therefore they put pressure on the BLS, Congressional Budget Office, and other agencies that put out economic reports.
They are also careful to hire their own economists and advisers who support their political views, in this case the move towards socialism.
As a free-market economist, I had always assumed that the debate over socioeconomic theory has already been proven.
That socialism doesn't work.
We see it hasn't worked in past periods, and it's not working today in Europe or in South America for instance.
The history of the progressive movement which started out as the communist movement, and the creep of socialism has always had its own set of economists, most of whom are seen by free-market capitalists as "utopists" who just don't comprehend how economies work.
The other day, I read an article "The Death and Life of Liberal Economics" by Kenneth Minogue discussing a few book reviews about past period socialist leaning economists.
The books are; 1.
) "The Great Persuasion" by Angus Burgin, Harvard Press, Boston MA, 303 pages, 2012 2.
) "Masters of the Universe" by Daniel Stedman Jones, Princeton University Press, 418 pages.
Now then, while I haven't read either book yet, only ordered them online, I can tell you that this is a very serious topic.
Just because a PhD economist, even someone who might have won a Nobel Prize in economics states that the economy is going to do this, that, or the other thing, doesn't mean it is so.
There are other economists with similar accolades who will tell you the exact opposite using their mathematical data, or predictive future models.
The politicians obviously wish to grab onto the economist which supports their political viewpoint.
We cannot fault the Obama Administration for doing this, but we can question their tweaking of the data so close to the election.
The Wall Street Journal had two back-to-back economic articles on Saturday October 27, 2012 just a week prior to the election; "Economy Grows at 2% Pace - Consumers, Government Spending Powered Third-Quarter but Growth Likely to Slow," by Josh Mitchell and Jeffrey Sparshott, and; "Economists' Goal: A Measure for All Seasons," by "the numbers guy" Carl Bialik.
Now then, the first article which was on the Front Page of the WSJ seems to be somewhat negated by the second article.
In the second article it was noted that trying to use the same metric for different seasons gives economists a fake resultant.
They know it, politicians know it, and no one has a realistic model which can be used for all seasons for legitimate comparison.
Why you ask? You see, at certain times of the year there is Christmas hiring, therefore more people have money in their pockets to spend, and in the fourth quarter we have more people shopping for retail goods.
Getting those products ready has to occur in the second and third quarter, so we would have an uptick in manufacturing, orders, and purchasing agent favorability statistics on questionnaires as to what the future is going to be.
As a former franchisor, I can tell you that business start-ups are seasonal.
So too is the service sector, housing sector, construction sector, and auto sales sector.
So, did the economy really expand at a 2% pace in the third-quarter? And realize a 2% pace per year of GDP growth in one quarter would be 25% of 2% or.
5% which interestingly enough would be in the margin of error, whoops, did I just blow the Obama Administration's cover just a week before the election? Paul Krugman, a former Nobel Prize winning economist has written endless economic editorial pieces in the New York Times during this run-up to the November 6, 2012 election as well.
He calls the Obama plan economically sound, and the Romney plan without merit.
Nevertheless, he is a staunch supporter of President Obama, and he believes socialism is the fairest way to run a country.
How can we trust his viewpoints? We can't, we also cannot trust what the economists are telling us with regards to President Obama's future economic plan.
Rather we should just look at what the administration has or hasn't done the past, because that would be a better indicator of what they will do in the future with a plan today which is indistinguishable from the one the prior.
Please consider all this and think on it.