New Lows for Unemployment? Jonah Goldberg Knows No Real Economist!

admin | February 1, 2007 1:21 am

I sometimes pity Jonah Goldberg. He reads some nonsense from Jeopardy champion James Pethokoukis and sees the names Michael Darda and immediately thinks this fellow has the Nobel Prize winning caliber of a Lawrence Kudlow (hint to Goldberg – that’s a joke):

I am starting to lend more personal credence to the theory that a combination of strong growth, fat corporate profits, and already tight labor market might push the unemployment rate to lows we have not seen since the 1960s.

The current unemployment rate is 4.5%, which matches the unemployment rate for October 1998. The unemployment rate continued to fall until it dropped to 4% as of December 1999 where it stayed for the rest of Clinton’s term in office. Darda, Goldberg, and Pethokoukis seem to be as unaware of this fact as they are of the fact that the civilian labor force participation rate (LFP) was higher during the late 1990’s than it is today. I made this simple for the National Review know-nothings by graphing LFP from 1997 to 2006. I also graphed the employment to population rate (EP), which was around 64% or more for most of Clinton’s second term. Today, it is only 63.4%. Given that the National Review know nothings probably don’t have a clue why I graph these two together, let me just point out for their benefit that the unemployment rate represents the difference between LFP and EP. So Corner Kids – please follow this carefully as it has two important parts: (a) the unemployment rate (the difference between LFP and EP) is actually wider than it was in 2000; and (b) LFP is also lower than it was in 2000. Combine these two facts and you can understand why the employment to population rate is lower than when it was during the late 1990’s. Is this so hard for these folks to understand.

OK – I would not expect a National Review nitwit to know anything about the labor market. But could someone be so kind to tell Mr. Goldberg that Lawrence Kudlow knows nothing about economics either – and that one should not trust the spin from Michael Darda? Then again – given the fact that Jonah Goldberg neither has a clue about anything related to economics and his is also clueless who to turn to for insights – why on earth does he bother to write his incessant nonsense about economic matters. Couldn’t he stick to something he does understand (albeit that might be an empty set)?
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