I Have To Ask, Why Do We Trust Them?
by James Glaser
March 26, 2009

The stock market went up yesterday, and the reason given by the New York Times was that the Commerce Department reported that "orders for durable goods" went up by 3.4% in February.

Durable goods orders might have gone up, but they very well might have gone down. Last month, Washington told us that in January durable goods orders fell by 5.2%, but now they revise that number to 7.3%.

The Commerce Department reported that orders for durable goods rose 3.4 percent in February after a downwardly revised 7.3 percent drop in January. Orders for machinery, transportation equipment and computers and electronics rose.

The monthly gain was better than economists' expectations of a 2.5 percent decline, and represented the latest in a series of less-than-terrible reports that have offered a break from months of relentlessly bad economic news.

In January the unemployment figure of lost jobs was 650,000 and we all thought that was a new record, but Washington said, "Not True." You see, they revised December and November's numbers, and they were higher. On top of that, Washington has played with unemployment numbers for years, making the economy look better than it really is.

The Bureau of Labor Statistics released the latest unemployment report showing that the US economy has now lost at least 650,000 jobs for three consecutive months, the worst decline in percentage terms over that length of time since 1975. The rise in the unemployment rate from 7.6% to 8.1% translates to an estimated 12.5 million jobless Americans. However, this rate may be even higher in real terms. As shown in the NY times graphic on the left, the real unemployment rate may in fact be closer to 15% when factoring in participation rates and part-time workers who want to work full time.

Here are two examples of what past presidents have done to make things seem better than they were.

In 1983 President Reagan needed his economic plan to look robust. So he lumped 1.5 million U.S. Army, Navy, Air Force, and Marine service personnel in with the civilian workforce. Overnight the unemployment rate was reduced by .2%.

In 1994 President Clinton employed a different approach. He re-defined marginally attached and discouraged workers. After 1994 a worker was NOT considered unemployed if he or she had given up hope and had not looked for a job in the last four weeks or was employed part-time but wanted full time employment. Really? If you have been out of work for a year and want gainful employment but have given up hope you are suddenly not there?

Politicians lie, and our government is run by politicians. If they tweak the numbers here and there, they can make the American public think things are better than they actually are. Barack Obama has had a few bad weeks with the AIG bonus scandal and his joking on television about disabled adults. So, do you think he or one of his staff is not tempted to play with some of our economic forecast numbers? You know they are saying to themselves that every past president has done that, and that is true.

The temptation is there, and you know they are thinking that a little good news could turn things around. My question is, why do we believe any thing that Washington tells us? We know they lie, and we know they have been doing it for years.

If you doubt that Washington lies, try Googling "What is the real inflation number?" or how about, "What is the real nation debt?"

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