A cursory reading of his document show a number of holes where he does not dig deeply into the cause of the numbers he is showing. He also uses a number of statistical fallacies that make his argument look good but don't work when other statistics are used.
Just off the top of my head here are a few of the holes I see:
First he compares today's economy to the Great Depression. That is a typical scare tactic to make people think the economy is a disaster. The economy is far from the Great Depression. First of all, in a truly bad economy, most companies are losing money. Right now, losses are concentrated in the transportation industry, for obvious reasons, and the financials, again for obvious reasons. The rest of the companies are doing reasonably well with individual variations of course. The company I work for, for instance, is a high tech communications company that is making money like gangbusters and is hiring rapidly. Many high tech companies are still making lots of money where typically they are the first to go down as high tech is usually purchased with extra discretionary income.
The conditions under the Great Depression saw 25-30% unemployment while today we sit at 6.1%, a historical low. Just to compare the misery of the Carter era, unemployment stood over 10% while inflation was at 21%. Today inflation is at 5.4%, most of it due to oil. And that is cooling off with oil in free fall. We are still not even in a recession by economist definitions, which require two consecutive quarters of negative economic growth. This quarter is expected to show a small growth while last quarter showed a very tiny drop of less than 1%, annualized. So right off the bat, his comparisons are all wrong.
In his first paragraph about the Bush economic team, he uses another fallacy. He compares the average tax cut of the top 1% of $83,000 to those of those making $51,600. What he doesn't compare is the average percentage of tax cut rather than a raw number. For instance, a person making $1 million a year who gets a 1% tax cut would get $10,000 back while someone making $50,000 who gets a 10% tax cut would get back $5,000. Which tax cut is more effective? $5,000 is worth a whole lot more to the person making $50,000 than $10,000 to the millionaire.
I also question his numbers of less than $1,000 for families making $51,600. Numbers that I had seen earlier showed that number to be closer to $2,500 for families in that income category. I haven't got the time to look it up further.
The argument on the minimum wage is also debatable. A rising minimum wage reduces jobs, so it's questionable whether a higher minimum wage even leads to higher overall wages. While people making minimum wage forever would suffer a loss in real income, people do not stay at minimum wage forever. So those same people five years later are usually not in the same income category. Here is an article by Arthur Laffer I read a couple days ago showing a large degree of income mobility, which disputes the contention that people are losing money.
New Evidence on Taxes and Income The graph I saw on falling numbers of manufacturing jobs is also misleading. Manufacturing jobs are falling IN ALL INDUSTRIALIZED NATIONS, INCLUDING CHINA. As manufacturing modernizes, this is a natural process.
On stagnating incomes, he does no analysis on why incomes have stagnated. He doesn't even include the negative impact of the dot com bust that coincidentally happened in 2000, the beginning of his statistical comparison. I'd like to see what his comparisons are for 2000-2001, 2001-2002, and so on. By completing ignoring the disappearance of 60% of the NASDAQ and the disappearance of trillions of dollars beginning in 2000 and counting that as simply bad Bush economic policy is misleading at best.
The argument that not enough jobs were made is also fallacious. Over five million jobs were created during the Bush Administration with unemployment falling as far as 5.1%, only to begin rising with the bursting of the housing bubble. If the workforce is growing faster than the number of jobs, unemployment would never have fallen to 5.1%. So that's wrong. Unemployment rises when the workforce rises without a comparable rise in jobs. Just as an example, the latest increase to 6.1 from 5.7% was mostly attributed to a rising workforce of 500,000.
I love the fact that all of his comparisons start with 2000, the height of the dot com boom and the bursting of the bubble. Considering trillions of dollars of income vanished that year meant that there was a huge hole for Americans to climb out of before Bush ever took office, which his statistics don't account for.
That was no small event. Consider that the NASDAQ stood at 5132.52 at its all-time high on March 10, 2000. One year later, the NASDAQ was at 2052.78, less than two months after Bush took office and while the economy was still operating under Clinton economic policies.
Worse of the worst, he does a very superficial analysis on why the real estate bubble was created and why it burst, automatically attributing it to Bush policies, when in fact the largest footprints in the mortgage industry, Fannie Mae and Freddie Mac, were controlled by Democrats, who severely mismanaged those companies, directly causing the current financial crisis. When the president attempted to address the problems before they became a crisis, Democrats stood in the way of reform. Just wait until the twin pending catastrophes of Social Security and Medicare when they begin to fail in just nine years. I might post something about the myth of the Social Security Trust Fund and the swindle those programs represent. Again, the president tried to reform those, only to be stopped by Democrats.
