Author: VD

Statistical shenanigans: U3

You may recall that my prediction that the U3 unemployment would exceed 11 percent in 2010 was “incorrect”. The BLS reported U3 at only 9.8 percent even though fewer people were working due to a concomitant increase in the number of people who had mysteriously decided to exit the labor force in the midst of the “recovery” That’s why I revised my 2011 prediction as follows: “U-3 unemployment will climb above 10 percent. The real unemployment rate will be much higher, but it will be masked by a decline in the Labor Force Participation rate below 64 percent. The employment-population ratio will fall below 58 percent for the first time since 1984.

Needless to say, I didn’t find it quite as inexplicable as some economists have to see that the current employment trend is defying “the rules of a normal economic recovery.”:

The labor force — those who have a job or are looking for one — is getting smaller, even though the economy is growing and steadily adding jobs. That trend defies the rules of a normal economic recovery…. The percentage of adults in the labor force is a figure that economists call the participation rate. It is 64.2 percent, the smallest since 1984. And that’s become a mystery to economists. Normally after a recession, an improving economy lures job seekers back into the labor market. This time, many are staying on the sidelines.

Their decision not to seek work means the drop in unemployment from 9.8 percent in November to 9 percent in April isn’t as good as it looks. If the 529,000 missing workers had been out scavenging for a job without success, the unemployment rate would have been 9.3 percent in April, not the reported rate of 9 percent. And if the participation rate were as high as it was when the recession began, 66 percent, in December 2007, the unemployment rate could have been as high as 11.5 percent.

Translation: the real U3 unemployment rate has been over 11 percent since 2010, as I originally predicted. However, the BLS has concealed this very high rate of unemployment by the simple tactic of reducing the size of the labor force despite the growing population of the country. This is only one of the many reasons that Mises was correct to condemn the use of statistical empiricism in economics; the statistics are neither reliable nor represent a consistent metric.

There is no mystery and it is not true that “nobody is sure why it’s happening.” The reason it is happening is completely obvious: there is no economic recovery. The Bureau of Labor Statistics is playing games, just like the Federal Reserve and most of the other Federal agencies, to conceal the observable fact that the Great Depression 2.0 has been underway for 30 months already. And their ability to hide it is gradually crumbling.

UPDATE: BLS report today: U3=9.1%, LFP=64.2%, E/PR=58.4%.

This is how you do it, Republicans

I’ve never heard of Ray Junior before, but this is most definitely the correct way to treat a reptilian politician who is attempting to falsely pass himself off as a fiscally conservative republican:

Junior: The question is simple: You’re a Senator today. The Ryan plan comes across your desk. Are you voting yes or no?

Haridopolos: Again, Ray Junior, I’m not getting into that today because it’s not the vote that I’m dealing with

Junior: But you’re on my show. This is the question I’m asking. We’re trying to figure out whether we want to vote for you to become a U.S. Senator. Are you voting for the Ryan plan or not? This is not about what you want to talk about. This is what I want to talk about. I want to know: Do you vote for this bill or not?

Haridopolos: What I’d like to talk about is simple – what did I do in the state Legislature…

Junior: I’m not interested in what you want to talk about, Mike. I’m mention what the voters want to talk about. The voters want to talk about the budget. And I’m interested in what I want to talk about — my show. Tell me: You voting for the Ryan plan, yes or no?

Haridopolos: Again, I don’t have all the information to make that decision yet.

Junior: How could you possibly not have all that information, you’re running for Senate?

Haridopolos: Ray, I thought you wanted to talk about what we had accomplished, not about a hypothetical.

Junior: Your guy that asked for you to be on the show said “Hey, I’d like to get him on the show.’ I said ‘fine. Let’s bring him on the show.’ So I’m asking you that question. The only reason people avoid questions like this, Mike, is because they don’t want to be tied in — when they don’t want to actually have people see how they would do things. There’s no reason to avoid this question. How could you possibly be running for U.S. Senate and not know what’s in the Ryan bill?

Haridopolos: I know what’s in the Ryan bill, but again, what you’re asking me is a fair question. What I’m telling you is…

Junior: Ok, I’d like a fair answer…

Haridopolos:…A lot of people are talking about hypotheticals — if they run, if they win. Let’s talk about what I actually accomplished

Junior: Laughter… no, no, no. You’re not doing that, Mike. Every single thing a person talks about when they’re on the campaign trail is a hypothetical. A hundred percent of it. There’s nothing that’s not hypothetical. The only way we know whether it’s going to be true or not is when they get into office is if they follow through on the things they said they would do. That’s why I’m asking you: Would you vote yes or no on Ryan?

Haridopolos: Exactly what I’m bringing up. My point as well. I made a promise to balance the budget, not raise taxes, not raise fees..

Junior: Ok, does the Ryan plan do that? Does the Ryan plan do that?

Haridopolos: Look, the Ryan plan is what’s in Washington

Junior: Ok, get him off my phone. I don’t want anything to do with this guy. Get rid of him.

What a pity that the big boys are all more interested in exchanging back rubs and foot massages with the likes of Newt Gingrich and Captain Underoos than they are in pinning down Republican would-be leaders on the big issues and holding them accountable. If you can’t answer a simple and straightforward yes or no question concerning your position on one of the central issues of the day, you should get the hell out of politics.

Don’t worry, you’re not too pretty for science

A female scientist desperately wants you to know that someone told her she was pretty, the bastard, and now she can’t wait to tell you about ithow angry that makes her!

I’m ticked off and venting via dashed-off blog rant…. I know Mr. Salesguy was trying to be nice and probably thought he was flattering me, but fer chrissakes, that is NOT the way to go about it. Women in science already frequently feel like “The Other,” that we’re “too XX” to be good at what we do, that our possession of breasts surely must mean that we’re too much of a fragile flower to be able to handle the “man’s work” involved in science and academia, and that we need to go above and beyond what our male colleagues do just to feel the same level of acceptance and appreciation. I’m sure Mr. Salesguy has never thought about the plight of women in science before tonight (and I doubt that my conversation really made him think about it for more than a few fleeting seconds), but it really dragged down what had otherwise been a very nice few days of unadulterated sciencey goodness.

This is a beautiful example of what is one of my favorite female faux outrage poses. Certain women, usually those of average appearance, love to pretend to be furious because someone complimented them, which they believe gives them an excuse to talk to everyone they can get their hands on about the fact that someone thinks they are pretty or whatever. You’ll notice you never see any genuinely gorgeous girl getting her thong in a twist over someone happening to recognize the obvious; she knows she’s hot and it’s no big deal.

And the idea that one can be somehow damaged by one’s looks defying the expectations of one’s occupation is a ridiculous attempt to justify the “look at me, look at me” behavior. At my second book signing, which was a large Barnes & Noble event at which there were some 10 or 12 other much bigger-name SF/F authors, including Gordon R. Dickson, there must have been at least 10 people who told me I didn’t look like a SF writer. I didn’t take any offense, of course, or agonize about how this made it terribly difficult to be taken seriously as a writer. It was not exactly hard to ascertain what they meant by the comment given that in addition to being the youngest one there by a decade or more, I was also the only weightlifter in the bunch. SF/F writers are often fascinating conversationalists and I quite enjoy spending time with them, but as a general rule they tend not to make for the most physically imposing specimens of humanity.

So, Ms Dr Smith needn’t worry. As an expert observer of the opposite sex, I don’t think she’s too pretty for science. I don’t think she’s pretty at all. I’m confident she can rest assured that most men who aren’t of low sexual market value, like the scientists and atheists by whom she is customarily surrounded, will not take any notice of her unless she happens to perform some spectacular feats of science. Which is probably unlikely, since she’s such a transparently superficial twit that she’ll find it hard to pull her narcissistic nose out of her navel long enough to observe anything scientific.

The danger of biting at ankles

You tend to get kicked in the teeth a lot:

Ok, so we go the whole day and no-one points out that free fall most certainly is acceleration. 9.8 m/s/s, to be exact.

The statement was not “freefall is not acceleration”, but that “acceleration is not freefall”. Does an orbital rocket blasting off accelerate? Does an automobile? And are either of these machines in freefall while they are accelerating as per their normal operation?

Some commenters appear to have an amount of trouble understanding the concept of sets and subsets. The subset is not, and cannot be, the set of which it is merely a part. (Cue Markku bringing up the null set.) I tend to doubt anyone would have felt the need to attempt offering a correction had I stated, for some inexplicable reason, “Numbers are not nine”. I desperately hope, anyhow, that even the most cluelessly contrarian anklebiter would have been able to resist the urge to reactively insist that “Nine is a number!”

Yes, it most certainly is. But three is a number and it is not nine. Ten is also not nine. There are, in fact, a vast collection of numbers that do not happen to be nine, just as there are many rates of change of velocity over time that do not involve the motion of a body where gravity is the only force acting upon it. The two terms overlap, but they are not interchangeable.

So, a helpful word of advice to the pedantically inclined. If you make a habit of actively seeking to criticize others or just have a tendency to react to assertions in an instinctively contrarian manner, I suggest learning to first ask questions rather than immediately attempting to offer corrections even when you are reasonably sure that you have understood what the other person said. Always get confirmation first. Because when you are dealing with anyone who is reasonably intelligent or even just precise in their thinking, there is a very good chance that your posturing – and let’s face it, that’s what it is – is going to cause you to make an ass of yourself by trying to correct something that is not, in fact, incorrect.

I understand that my towering intellectual arrogance is infuriating to some readers. Even those who often agree with me are sometimes sorely tempted to attempt to “bring me down” when they perceive an opportunity. But not every red flag waved in your face merits a blind and heedless charge. If you’ve read this blog for any time at all, you should be aware that there are few things in which I find more personal amusement than publicly skewering a superficial and reactively contrarian would-be critic.

The cancerous eyes of the state

Murray Rothbard expands his logical case against empiricism in economics, specifically, explaining how the systematic gathering of statistics tends to lead inevitably to bureaucracy and increased government intervention in the economy:

[S]tatistics are desperately needed for any sort of government planning of the economic system. In a free-market economy, the individual business firm has little or no need of statistics. It need only know its prices and costs. Costs are largely discovered internally within the firm and are not the general data of the economy which we usually refer to as “statistics.”

The “automatic” market, then, requires virtually no gathering of statistics; government intervention, on the other hand, whether piecemeal or fully socialist, could do literally nothing without extensive ingathering of masses of statistics. Statistics are the bureaucrat’s only form of economic knowledge, replacing the intuitive, “qualitative” knowledge of the entrepreneur, guided only by the quantitative profit-and-loss test. Accordingly, the drive for government intervention, and the drive for more statistics, have gone hand-in-hand….

Suffice it then to say that a leading cause of the proliferation of governmental statistics is the need for statistical data in government economic planning. But the relationship works also in reverse: the growth of statistics, often developed originally for its own sake, ends by multiplying the avenues of government intervention and planning. In short, statistics do not have to be developed originally for politicoeconomic ends; their own autonomous development, directly or indirectly, opens up new fields for interventionists to exploit.

Each new statistical technique, whether it be flow of funds, interindustry economics, or activity analysis, soon acquires its own subdivision and application in government.

In the RGD chapter entitled “No One Knows Anything”, I demonstrated how wildly inaccurate, mutable, and untrustworthy the economic statistics on which so much government policy is predicated are. But the problem is that regardless of how inaccurate or even irrelevant they are, they will be used to justify government action in various areas of the economy and inspire public malinvestment while simultaneously exacerbating private malinvestment. If statistics are the eyes of the state, the central flaw with them that they will always be short-sighted, astigmatic, subject to optical illusions, and prone to aggressive intraocular lymphomas.

On podcasting

I get a lot of requests to do more podcasts on a regular basis, and while I’m amenable with regards to the necessary talking, interviewing, and so forth, I’ve finally concluded that I’m simply not at all interested in doing the necessary editing and studio tinkering. So, if there is anyone who is interested in that side of it, let me know. I don’t have any grand ideas about going full media, but given how most of the world seems to be astonished that the global economy is headed back tostill experiencing economic contraction, I figure that there may be a need for more of the sort of thing I started with the Voxonomics podcasts.

Basically, I’d like to be able to record an MP3, upload it to a server, and have a reasonably edited podcast magically appear within a day or two. If that’s not possible because no one is interested, it’s completely fine, but I thought I should at least throw this out there for any audiophiles with some time on their hands.

Tipping Point USA

Scott Adams suspects there may be one in the near future:

Yesterday I went to Walmart and demanded that they give me a cartload of merchandise for free. This demand was not well-received, so I didn’t get to the second part of my plan which would have involved criticizing the job performance of the people who were giving me free stuff.

Okay, I didn’t really go to Walmart and demand free stuff. You probably knew that because it sounded ridiculous on face value. We all understand that no entity can survive for long if it gives away its resources while asking nothing in return. And this leads me to my point: In the United States, 51% of adults pay zero federal income tax, and yet they have the right to vote. That’s the very definition of a system that can’t last.

I’m not sure where the tipping point is. So far, the power of the non-tax-paying majority has been blunted by the influence of political parties and the misdirection of the media. If the majority ever figures out that they can legally confiscate the wealth of the minority, tax rates will double overnight. My best guess is that the United States will go into a death spiral at about the point that 55% of adults pay no federal income taxes.

It’s not quite a legitimate analysis, in that many of those who don’t pay any income tax do pay payroll taxes. But the general point is correct. No quasi-democratic system, even a very limited representative one, can reasonably hope to survive as long as those who benefit from it are permitted to vote themselves benefits.

It’s too soon to tell, on the basis of a single Congressional election, if the mere threat of partially pruning the entitlement programs is enough for a sufficient number of swing voters to turn against the Republicans in general and the Ryan Plan in particular, not that either will actually solve the dire financial and economic situation in which the nation has mired itself. But if Americans simply will not support the eviscerating of Social Security, AFDC, Medicaid and Medicare despite the fact that they cannot afford to pay for them, it will prove the point that Adams is making.

But he is incorrect about one thing. The USA is already in a death spiral. It simply hasn’t struck the ground yet.

You don’t say

The headline on Drudge made me laugh.

“‘WE ARE ON THE VERGE OF A GREAT, GREAT DEPRESSION‘”

Really now? I am… so very surprised!

“Interest rates are amazingly low and that, thanks to Ben Bernanke, is driving everything,” Yastrow said. “We’re on the verge of a great, great depression. The [Federal Reserve] knows it. We have many, many homeowners that are totally underwater here and cannot get out from under. The technology frontier is limited right now. We definitely have an innovation slowdown and the economy’s gonna suffer.”

This was all entirely predictable. It was, in fact, predicted. My timing was a little off, as usual. I thought the media would start realizing the reality of the situation towards the end of 2010, not the middle of 2011. But the situation remains precisely the same one I described in the Introduction to The Return of the Great Depression and I see no reason to change a word of it.

“Due to the sizeable bear market rally that began in March 2009, many, if not most, economic observers are presently convinced that the global economic difficulties of last autumn are largely behind us now, courtesy of the aggressive, expansionary actions of the monetary and political authorities.

They are wrong. It is not over. It has only begun.

I believe that what we have witnessed to date is merely the first act in what will eventually be recognized as another Great Depression.”

Acceleration is not freefall

I tend to find it somewhat mystifying when an anklebiter yet again attempts to pronounce the irrelevance of Vox Popoli for the Nth time since the very first one did so sometime back in October 2003. I never thought to create a general interest blog, in fact, it took a six-month false start before I even managed to start doing daily posts. Now, posting here is just a part of my routine that requires about as much mental effort as going to the gym or making lunch, the difference being that I am considerably less likely to sprain something while posting here.

(Speaking of which, I was pleased that I was able to jack my dumbbell military press up to 5x30kg yesterday. I was rather less pleased to discover that my neck now objects to being turned to the right. Ah, the bittersweet joys of age.)

Anyhow, in response to one of the anklebiter’s claims that the blog was in decline, I mentioned that its readership, like that of WND’s, has continued to increase over time. But what surprised me when I went back to look at the actual numbers was that the rate of readership growth has also been increasing.

May 2008: 136,577 monthly visits
May 2009: 151,610 +11.0%
May 2010: 185,275 +22.2%
May 2011: 245,493 +32.5%

In fact, last month set new records for both visits and page views (365,271) despite the fact that there were no new books released, no incoming traffic from any of the big blogs, and nothing of exceptional interest happening around the world. At this rate, there will be 350k monthly readers by this time next year, which is about 320k more than I’d ever imagined there would be.

Anyhow, I appreciate the way so many of you take the time to stop by on a regular basis and see what’s going on, I’m glad you continue to find the posts here to be of interest, and I appreciate the way in which your questions and substantive criticism help to clarify my thinking.

Mailvox: a profound change of thinking

MK writes to tell how she has found the dreadful miasma of misogyny that engulfs this blog to not only have adjusted her thought processes but also aided her marriage:

It occurred to me yesterday what a profound change in thinking I have had as a result of reading your blog and one of the books you referenced (Married Man’s Sex Life). In my youth in the 70’s, I was happy to soak up the happy horse-sh#$ that popular culture sold about roles of men and women. My marriage of [two decades] has been a difficult struggle owing in part to my desire to see my husband as a badly designed female.

For his part, in my assessment, my husband still struggles with the reality that I am not a man – that is, that I lack career ambition, aren’t that good at finishing what I start (except household duties), and would prefer he initiate sex. It might be harder for him to give up the desire for me to share the providing than for him to give up on primary child-care duties (when that was needed) and housework. The upshot: it is a relief to accept I am not the woman Madison Ave. promoted who wants and can bring home the bacon, serve it up in a pan, and also provide hooker style sex services to my man. That never was me and I always felt inadequate.

I hate to say, I think my husband does view me as inadequate (he works with many woman/mothers who earn big bucks alongside him, not to mention his mother was a dynamo working wife/mother out of monetary necessity). The blog has helped me, however, to accept that I am who I am and more importantly, he is who he is as a he. I have a newfound respect for that. Little by little, I am changing my behavior and attitude and while my husband may always feel he got ripped off because I really wasn’t the career woman he thought I was (I had a job when we met, was good at it, liked it, and parlayed it into working from home so I could take full-time care of and homeschool our children, not because I needed to work for my identity or the money; rather, I did it because I knew my husband wanted me to make money).

I am a Christian of [more than a decade], and this has been an area that the church we were involved with was no good at leading (male/female roles). I have a friend who has been a Christian all her life, but struggled in her marriage. She did not marry a devoted Christian and longs for leadership, but from our conversations, it is clear, she’s at least 50% of the problem. I have shared insights with her from the blog and it is changing her too. Thank you and please keep doing what you’re doing.

I’m glad she’s found the blog to be helpful. I think it’s interesting to see how MK’s email shows the flipside of the female employment issue. Whereas many men don’t want their wives to work so that the women can focus on their careers as wives and mothers, those who do marry working women often expect them to continue working so the men do not have to shoulder the responsibility as the sole income provider. This is dangerous ground, because it is a potential deal-breaker should the woman decide she wants to unilaterally change the arrangement ex post facto.

While women tend to feel they always have the right to change their mind, consider it from the male perspective. What wife would appreciate it if her husband told her that he wasn’t happy with his job and had decided to stay home and master Guitar Hero instead? Would she be delighted that he was pursuing his dream or would she be upset that he had, in a single stroke, suddenly put pressure on her to figure out how to increase her salary by at least 50 percent or accept the necessary reduction in the lifestyle to which she was accustomed? Even though MK’s decision was beneficial for both her marriage and her children in the long term, it’s perfectly understandable that her husband would feel as if he had been played with a bait-and-switch, because it would appear that he was, at least to some extent. There are no shortage of men who have discovered that housework isn’t as unpleasant, stressful, or time-consuming as office serfdom and they are more than happy to divide the responsibilities as they have been told that women want them to do. Naturally, they will resist a sudden demand that they to return to a more traditional role for which they are completely unprepared, and indeed, might even consider to be evil and sexist.

It’s also noteworthy that she has found the church to be useless with regards to offering support for traditional male and female roles. Churchianity is relentlessly feminized and feminist, which is only one of the many reasons to reject it as a pale, bureaucratic, heretical imitation of Christianity.

But I am pleased to hear that MK and her friend have derived a modicum of personal utility from this blog, and I’m sure Athol could use the encouragement as well.