Jared Bernstein is an economist and senior fellow at the Center on Budget and Policy Priorities. He was formerly chief economist to Vice President Joe Biden and a member of President Barack Obama’s economics team.
Overheard recently: senior staffers of a mid-sized software developer on the West Coast. The names have been changed to protect the innocent.
Jeff, a manager (with great enthusiasm): My staff has really been producing lately -- I mean these guys have been staying late, missing lunch, you name it. And given that we seem to be pulling out of the slump, I'm thinking we should add a new position. After all, my department is at least 10 after the downsizing.
(Others around the table gasp audibly.)
Ross, CEO: Hold on, everyone. Let's hear Jeff out. His folks have been delivering the goods big time since we cut out all that excess fat a few years ago.
Recently, it was my good fortune to be able to testify before the House Committee on Education and the Workforce. But it was my great misfortune to have to follow the Almighty One: Alan Greenspan.
Our nation's chief economist just sucks all the air out of the room. After his two hours of testimony and discussion with committee members, he (and almost everyone else) got out of there. I'm telling you, the guy raises his hand to illustrate a point, and 50 cameras go off.
So I should warn you: Today's column is steeped in the petulant tone of a mid-level wonk who was totally eclipsed by the Man. Feel free to bail on this rehash of what we each said. No hard feelings.
Every leap year, especially when economic insecurity is high, the question surfaces: When it comes to jobs and growth, do presidents really matter?
Already we're hearing at least three separate responses to that question. First comes the claim that the whole question of presidential impact on the economy and jobs is silly and politically, not economically, motivated. As Robert Samuelson put it in his Washington Post column, “Electing a president based on job creation makes as much sense as selecting a doctor based on palm reading.”
Next is the “but for” argument from the incumbent's team: We would have created scads of jobs but for September 11, the Iraq War, and corporate wrongdoing.
The annual meeting of the nation's economists isn't exactly a swinging affair. There's lots of talk about asset pricing models, and the hotel hallways resonate with arguments about the right way to specify vector autoregressions (don't ask).
But at the meeting that wrapped up last month in San Diego, Alan Greenspan, our eminent chairman of the Federal Reserve, dropped a bit of a bomb.
During the question-and-answer session, my Economic Policy Institute colleague Max Sawicky, to his immortal credit, inquired as to what Greenspan considered to be the lowest unemployment rate consistent with stable prices. In other words, what's the unemployment rate at full employment?