Vin Weber, Another WIngnut Neocon Romney Adviser Humbugging About New Family Income Data
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| Yes, Vin, you can buy a copy of my book, but I only take cash. From you. |
Weber left the House in 1992 to avoid more nastiness in the House Banking scandal where he ran up against a limit of 125 overdrawn checks. After leaving post haste from the House he still managed to help Speaker Gingo try to make a mess of the country during the House Republican Revolution of 1994. Then Weber moved on to join the neocons, and advocated the immediate-if-not-sooner removal of Saddam Hussein because, well, everyone knew he was hiding WMDs somewhere in the vicinity of somewhere in Iraq. Lately, Weber advised Pawlenty’s brief and hapless run for the GOP presidential nomination, and then, alas, wound up on Mitt Romney’s economic policy team where he can provide counsel on economics, at least on the art of banking in the House of Representatives.
About those recent polls that bring smiles to Obama supporters, Weber, with uncharacteristic understatement for a right winger, admitted that the campaign had suffered a few mishaps lately, a “couple of mistakes.” He advised that the Romney/Ryan team “refocus.” That ship has flown, Mr. Weber, but what the heck, one more refocus certainly can’t hurt. Weber went on to babble this:
“The president has some advantages in the polls today. He has one disadvantage going forward which I would simply call reality. We go the August family income report out yesterday. It showed that family income declined again. Chairman Bernanke and the Fed they simply told us last week that absent action we’re headed toward another recession. It’s that reality that we have to drive home to convince people that they indeed to need to make a change of course.”
Leaving that aside, let’s slice and dice!
(1) The report Weber refers to is not an official U.S. governmental report (although I do not canonize official government reports). It was produced by Sentier Research, using its proprietary Household Income Index, “the first index to track changes in median household income on a monthly basis,” according to their website.. Sentier’s principals were former officials at the U.S. Census Bureau, and highly qualified. Their Household Income Index is derived from the monthly Current Population Survey (CPS) conducted by the U.S. Census Bureau.
The analogous and official Bureau of Economic Analysis (BEA) data, Personal Income & Outlays for August 2012 will be out at 8:30 am tomorrow. (I’ll do a brief follow-up to this article with their data tomorrow.) (Here’s last month’s BEA report for July 2012),
For now, it’s important to note that the Sentier collects data under the Census Bureau’s definition of income (“money income”) and thus differs in what it includes as income from the BEA’s definition (“personal income”). In all things political, definitions are crucially important, they are nearly determinative of the outcome of data analysis, and differing definitions must be taken into account. For one quick example, a joint BEA and November 2004 Census study, Alternative Measures of Household Income, noted these differences in income for 2001: BEA – $8,678 trillion; Census – $6,446 trillion.
Vin Weber, as a Romney adviser, was reporting the Sentier findings in his comment on Andrea Mitchell’s show, and indeed, according to their census definition of income they found that median family income declined 1.1% in August (to $50,678).
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| Click chart for clearer version |
- Looking deeper and with a longer timeline than just the last month, the chart uncovers data favorable to the Obama administration, not to Mitt Romney, who by the way has a misleading ad circulating misusing Sentier’s useful data.
1. Recessions do not turn on a dime into full recoveries. Have a look at the chart after the end of the 2001 recession. Family income continued to fall and unemployment continued to rise. Indeed, unemployment actually went on to exceed levels plumbed during the recession. Also the family income trendline declined throughout Bush’s first term even after unemployment improved, and didn’t pick up until the second year of his 2nd. Moreover, the uptick was driven by the financial bubble that produced the housing that was financed by mortgage backed securities and which led to the meltdown.In the end, when Bush left office family income was below its level in 2001.
2. President Obama inherited a different kind of recession (a deleveraging, deflationary recession), a behemoth difficult to resolve through normal monetary policy, the Great recession. In fact, his term began with U.S. personal income a few months into what would become a collapse from 2008 to September 2011.
Despite the collapse of family income from late 2008 to September 2011, on President Obama’s “watch” unemployment declined due to stimulus efforts begun via Bush’s anemic February 2008 $158 billion stimulus package. Obama signed the $889 billion American Recovery and Reinvestment Act in February 2009, early in his term (without a single GOP vote).
3. The good effect on unemployment can be seen above. Family income during President Obama’s term lags the improvement in the unemployment rate, just as in 2001-2002. Income is, though, on an overall upswing. After the peak of the 2001 recession, a rise in family income back to pre-recession levels trailed the decline in the unemployment rate by five years. The present recession, being far more severe, will likely follow the same path, if we – and Europe – recover more consistently, and don’t fall into a second worldwide Great Recession, or worse.
- In any event, below is the BEA report for the period 01-01-2012 through July 2012, one month short of the Sentier graph above. (BEA’s August report to be released tomorrow). Their data indicates a nearly continuous rise in pre- and post-recession real inflation-adjusted personal income during both the GW Bush administration and the Obama administration.
- One notable difference between Bush’s and Obama’s post-recession record is a moderately close fit for the Sentier and the BEA charts. Personal (BEA) or family (Sentier) income took longer under Bush to rebound after the 2001 recession than it has under Obama following the 2007 recession. All in all, both charts indicate a rather stellar performance by the Obama administration despite the biblical strength headwinds stirred up by the GOP, particularly the Paul Ryan’s and Eric Cantor’s of the House.
Click chart for clearer version.
- Finally, below is more data that is unfortunate for Vin Weber and the Romney/Ryan campaign portrayal of President Obama as a failure. The administration – again – despite intransigent resistance to stimulus by the GOP, has managed to oversee a rather strong comeback.
Term Years Personal Income
IncreaseBill Clinton 1 1992-1996 20% Bill Clinton 2 1997-2001 16.7% Bill Clinton 1992-2001 40% GW Bush 1 2001-2005 15% GW Bush 2 2005-2009 5.3% GW Bush 2001-2009 11% Barack
Obama 1
(as of 09/27/2012)2009-2012 6.3%
Romney’s spokespersons are often, shall we say, unfortunate. Witness John Sununu’s disjointed manic tirades; Ann Romney’s highhanded finger wagging; Eric Fehrnstrom‘s etch-a-sketch moment; and on and on. Today, Rush Limbaugh told listeners to support Romney because he hasn’t done “anything to you yet.” (Yet! Now there’s a bumper sticker!)
And now we’ve seen Vin Weber spin an articulate, well-meaning, and useful Sentier study to prove how President Obama has failed the country. In fact, looked at with a sense of perspective apparently missing from Weber’s focus, the Sentier chart is a terrific indicator of how toxic the Bush presidency was for family income.
During his comments to Andrea Mitchell Weber Weber advised the Romney cadre to “refocus” after a “couple of mistakes” recently. He ought take his own advice.
