November 27, 2010

Within 3 Days, AP’s Reported Unemployment Estimates Significantly Worsen

Filed under: Business Moves,Economy,Taxes & Government — Tom @ 8:26 pm

In separate reports for the Associated Press during the past week, Christopher Rugaber and Jeannine Aversa, economics writers for the wire service, each dealt with estimates for next year’s average unemployment rate. They came back with significantly different predictions for 2011 without recognizing how widely those estimates varied.

On Tuesday, Rugaber dealt with the Federal Reserve’s latest economic growth projections, in the process telling readers that the Fed expects that the unemployment rate “will be 8.9 percent to 9.1 percent in 2011.”

On Friday, Aversa looked at three alternative proposals for handling next year’s federal income tax rates, which will increase substantially for everyone unless Congress acts. The projected unemployment rates for next year under the three proposals are all either 9.9% or 10.0%.

So the Fed thinks that unemployment will come down next year, while Aversa’s consulted experts think it will go up slightly regardless of what Congress does or doesn’t do about taxes. The one-point difference between the two sets of estimates represents about 1.5 million workers. That’s not a small number. Did things suddenly get worse while the turkeys were cooking on Thursday?

Maybe, maybe not. But it is clear from Rugaber’s report that the Fed’s unemployment outlook has turned more grim in the past five months:

Federal Reserve officials have become more pessimistic in their economic outlook through next year and have lowered their forecast for growth.

The economy will grow only 2.4 percent to 2.5 percent this year, Fed officials said Tuesday in an updated forecast. That’s down sharply from a previous projection of 3 percent to 3.5 percent. Next year, the economy will expand by 3 percent to 3.6 percent, the Fed said, also much lower than its June forecast.

Fed officials project that unemployment won’t change much this year, averaging between 9.5 percent and 9.7 percent. The current unemployment rate is 9.6 percent. Progress in reducing unemployment has been “disappointingly slow,” the central bank said, according to the minutes of its Nov. 2-3 meeting.

… The jobless rate will be 8.9 percent to 9.1 percent in 2011, Fed officials predict. That’s much worse than June’s projection of 8.3 percent to 8.7 percent.

By 2012, when President Barack Obama faces the electorate, unemployment will be 7.7 percent to 8.2 percent, up from the previous forecast of 7.1 percent to 7.5 percent.

Gosh, this bad news about the continually decaying projected employment situation has sure been quiet. I won’t even bother asking if it made the Big Three networks’ evening newscasts.

But Ben Bernanke & Co.’s estimates are optimistic compared to those Aversa relayed in the midst of presenting three possible scenarios for dealing with next year’s scheduled tax increases:

OPTION ONE: Let the tax rates for the highest earners rise back to what they were before 2001, when the first round of Bush tax cuts was passed. But extend them permanently for everyone else. This is what Obama favors.

Moody’s Analytics says that under this scenario, the economy would grow 2.6 percent in 2011. That’s better than the scant 0.9 percent growth envisioned if everyone’s tax cuts expired.

Economists note that low- and middle-income people tend to spend more of their take-home pay than the highest-earners do. That’s especially true in a tough economy.

Still, unemployment would average 10 percent next year, up from the 9.7 percent estimated for this year. The jobless rate would tick up as growth weakened slightly next year.

… OPTION TWO: Extend the tax cuts for one or two years for the highest earners and permanently for everyone else.

Moody’s Analytics estimates this scenario would help the economy more than the first approach. The economy would grow 2.95 percent next year – a 0.4 percentage point improvement over Option One.

Unemployment would average 9.9 percent next year.

OPTION THREE: Make the tax cuts permanent for everyone. This is the plan Republicans favor.

By Moody’s calculations, the impact on unemployment, growth and the deficit in 2011 would be the same as in Option Two.

Aversa’s report is deeply marred by the pervasive assumption that consumer spending is what drives economic growth. Only in her final paragraphs does she get to economist Allen Sinai, who tells us that, in the AP reporter’s words, “letting the tax cuts for high-income Americans expire could reduce the flow of money into private equity firms, venture capital and other investments that ‘grease the wheels of entrepreneurship in the U.S. economy.’”

But the bigger story in Aversa’s report is that the tax analysts she consulted all believe that the unemployment rate is going up next year, no matter what. Maybe she should let Chris Rugaber, and more importantly Ben Bernanke, know.

Cross-posted at NewsBusters.org.

IBD on ‘Stem-Cell Fraud’ Mostly Gets It

Filed under: Life-Based News,MSM Biz/Other Bias,Taxes & Government — Tom @ 8:05 am

California taxpayers have been fleeced once.

Proponents want to do it again.

IBD weighs in nicely in preemptive opposition, with one shortcoming noted later (bolds are mine):

(The original $4 billion) Proposition 71 was based on two false premises. The first was that money was the problem and by restricting federal funding on embryonic stem-cell research (ESCR) to existing stem-cell lines derived from previously destroyed embryos, President George W. Bush had stopped the science in its tracks.

Federal funding of stem-cell research was one of the decisions President Bush covers in his book “Decision Points.”

On Page 117, he writes: “Embryonic stem cell research seemed to offer so much hope. Yet it raised troubling moral concerns. I wondered if it was possible to find a principled policy that advanced science while respecting the dignity of life.”

And here’s a fact you never hear: Bush was the first president to fund embryonic stem-cell research at all. He decided to continue funding on existing stem-cell lines derived from already destroyed embryos, but not fund new lines created from embryos created just for that purpose. Private ESCR research was never banned.

The second false premise was that ESCR was the only promising avenue of such stem-cell research. Because embryonic stem cells could be easily coaxed into becoming any body part, the argument went, research into adult stem cells was a waste of time.

The Obama administration recently approved only the second human clinical trial using embryonic stem-cell lines.

“We’ve heard so many times that adult stem cells can’t treat diseases, or only treat a few blood diseases, and those who have pointed out the truth, that adult stem cells are already helping patients for over 70 diseases and injuries, have been scorned,” Prentice notes.

… Prop 71 was driven by ideology, not science. Were it otherwise, the money should have flowed to those pursuing, and producing, actual treatments and actual therapies for actual human beings.

It would be nice if scorn were the only thing ESCR proponents have. As is the case with the hoax known as human-caused global warming, they still have mythology and a fair amount of control over the pursestrings on their side. 

As is the case with what I refer to as “globaloney,” a substantial portion of the ruling class and the media won’t let go of ESCR no matter how beneficial adult stem-cell research (ASCR) proves to be. The editorial’s only shortcoming is that it didn’t elaborate on why that’s the case. 

With globaloney, we have an admission on the record from Ottmar Edenhofer, an IPCC economist, that their enterprise is all about a different kind of green, i.e., worldwide wealth redistribution and control (as translated — “But one must say clearly that we distribute by climate policy de facto the world’s wealth”).   

With ESCR, we don’t have a smoking-gun admisson just yet. But in addition to the obvious monetary motivations of ESCR-involved researchers, there is an obsession on the part of some (you know who you; you just don’t have the honesty to publicly acknowledge it) to prove that you can improve the live of the already living by taking embryonic human lives. 

They’re self-evidently wrong. With each passing day during the past decade, ASCR’s forward march has gradually removed their mask. For all practical purposes, we don’t even need a motivtional admission any more. As they continue to bitterly cling to their mythology in the face of overwhelming evidence, they tell us all we need to know.

Positvity: Three Samoan teenagers rescued after 50 days adrift at sea in tiny boat

Filed under: Positivity — Tom @ 6:56 am

From Samoa:

Three Samoan teenagers have survived 50 days adrift in the Pacific Ocean, being found alive by a tuna fishing vessel long after their families had given them up for dead.

9:45AM GMT 25 Nov 2010

The youths, two aged 15 and one aged 14, had disappeared on Oct 5 in a tiny aluminium boat from the remote Atafu Atoll.

The trio were presumed to have drowned after unsuccessful searches by the New Zealand Air Force and Samoa had held a memorial service in their honour.

But, in a remarkable stroke of luck, the teenagers were spotted on Wednesday by a New Zealand tuna fishing boat which was far off its usual course.

Samuel Perez and Filo Filo, both 15 and Edward Nasau, 14, had drifted 800 miles and were in waters northeast of Fiji when they were rescued.

The first mate of the fishing boat the San Nikunau said that the boys had only eaten one seabird and a couple of coconuts during their time at sea.

In the days before their miraculous rescue, they had started drinking seawater, because it had not rained for some time, and would not have survived much longer, he said.

However, the teens had sustained surprisingly few injuries during their ordeal. They were thin and sunburnt, but otherwise fairly healthy and in good spirits.

“We got to them in a miracle,” Tai Fredricsen, first mate of the San Nikunau, said. …

Go here for the rest of the story.