Fisking Ferguson I

Aug 20 2012 @ 2:01pm

My old and good friend Niall Ferguson has written an essay arguing against re-electing Obama. So for the second time in four years, we will be backing separate candidates. One reason is that I believe that the Bush-Cheney wars turned out to be disastrous and a second war against Iran could be catastrophic. Niall has had no such change of heart and remains an advocate of American imperial power. Another is that I do not share Niall's view of the Obama administration's record, which I think he massively – and rather self-evidently – distorts.

Lets start with one sleight of hand noted many many times on this blog. Niall uses a February 2009 rough draft from the Obamaites in transition on the outlook for the next four years as a way to prove that their "promises" fell short. It does nothing of the sort:

Back then, the consensus was that the economy had shrunk some 3 percent in the last quarter of 2008. That was the data on which Romer at el based their predictions. We now know the recession was far worse – with a decline in the fourth quarter of close to 9 percent – three times the contemporaneous assumption.

Niall concedes this at one point:

It was pretty hard to foresee what was going to happen to the economy in the years after 2008.

But that doesn't prevent him from writing something as clearly propagandistic as this:

Unemployment was supposed to be 6 percent by now. It has averaged 8.2 percent this year so far.

By Niall's own admission, that proves nothing except the vagaries of prediction. But he still wants to use it to indict Obama. I cry intellectual foul. Even more amazing, this is his assessment of Obama's record on jobs:

The total number of private-sector jobs is still 4.3 million below the January 2008 peak.

Er … but Obama didn't become president in January 2009? Or did that fact also elude the fact-checkers? Most fair assessments of Obama's employment record give the guy some slack for his first twelve months because of the enormity of the crisis he inherited. But Niall insists not only on judging him by job growth after February 2009 but after January 2008! Almost the entire recession is on Obama's watch, including Bush's last year! And that, alas, is roughly the quality of the entire piece.

To judge Obama's record on jobs, you need a better benchmark. Lets try two. The first is the last administration's first term. Here's a graph comparing the two presidents on private and public sector job growth – and remember Bush had nothing remotely like the recession that Obama had to cope with:

BUSHvOBAMA_jobsREV

If you removed the blue and red labels, you'd assume that Obama was the conservative and Bush the leftist, wouldn't you? And that Obama was therefore far more successful. Yet Niall manages to argue exactly the opposite. Under Obama, there has been a serious reduction in public sector jobs – largely by state governments. But I'd say Obama's record in private job creation easily defeats his predecessor, even when dealing with the worst recession since the 1930s.

Or look at other countries, including Britain, where the Coalition government has followed Niall's advice that our main problem right now is the threat of soaring inflation. Here's the unemployment record globally for the past four years:

UnemplChart

Under Obama, the US has recovered more strongly than Europe or Japan. It's not dispositive proof of the superiority of Obama's policies but when compared with his predecessor and his global advanced economy competitors, he's doing pretty well. Good enough? Nope. But the task of drawing down such massive debt was bound to lead to a slow recovery. In America, it's been a lot faster than Europe or Japan. In 2008, unemployment was at 10 percent in Europe and the US. In Europe it's now over 11 and rising. In Britain, after following Niall's directives, half a million more people are unemployed than in February 2009, and all the predictions are for more unemployment ahead. Here, it's close to 8 and declining slowly.

Then there are the glaring omissions. Niall simply pretends the cost-control pilot schemes in the ACA do not exist at all. This is Simply. Not. True:

The Patient Protection and Affordable Care Act (ACA) of 2010 did nothing to address the core defects of the system: the long-run explosion of Medicare costs as the baby boomers retire, the “fee for service” model that drives health-care inflation, the link from employment to insurance that explains why so many Americans lack coverage, and the excessive costs of the liability insurance that our doctors need to protect them from our lawyers.

Agreed on the last two – but the idea that there is no attempt to unravel fee for service or try to get cost control in the ACA is something even the lowliest fact-checker should have caught. This is absurd propaganda, not journalism. It may be that the cost-controls fail. Fine. Make that case. But don't pretend there wasn't the most ambitious effort to control healthcare costs in decades.

More to come. The piece is sadly so ridden with errors and elisions and non-sequiturs it will require a few more posts.