America Likes To Punch Itself in the Face

The Congressional Budget Office (CBO) released its unemployment projections yesterday, and here's what they had to say:

CBO Forecasts High Unemployment For Years

Specifically, they expect unemployment to remain above eight percent until 2014, six long years after the economy crashed.  Here's the actual graph:

A couple of things jumped out at me when looking over the data that shouldn't really be that surprising to  a lot of people.  First, these cycles really are pretty cyclical  You hear them described that way all the time, but's calming to see those waves coming in.  

Second, the article failed to mention what they were predicting for after 2014, which was a precipitous drop back to more normal a-hair-under-6% levels.  Hopefully there's some truth to those predictions and most of America can get back to their normal lives relatively soon, and by that I guess I mean three plus years from now.  Also interesting to me is that the unemployment rate under Reagan hit even higher rates back in the early eighties.  

To dig up a NY Times Classic, the 1983 to 2011 comparison was made in the article

From 1983, Hopes For Jobs In 2011

Reagan, after inheriting a down economy and failing to fix it in his first few years, watched the Congressional incumbents receive a wake-up call in the the form of a mid-term election beat-down.  The unemployment rate fell dramatically from 10.8 to 10.4 percent, but mostly because people simply gave up looking for work, technically taking them out of the work force.  Same basic thing happened at the beginning of 2011 (9.8 to 9.4%).  Reagan and Obama both chose to overlook those volatile numbers and concentrate on positives such as... the stock market was strong in 1983, it was strong at the beginning of 2011.  

One other similarity.  The country was perilously close to its debt ceiling limit in 1983, and it was again in the beginning of 2011.  So President Reagan wrote a letter to Senator Howard Baker (R. TN) and asked that the debt ceiling be raised, saying:

This country now possesses the strongest credit in the world.  The full consequences of a default -- or even the serious prospect of default -- by the United States are impossible to predict and awesome to contemplate.  Denigration of the full faith and credit of the United States would have substantial effects on the domestic financial markets and on the value of the dollar in exchange markets.  The Nation can ill afford to allow such a result.  The risks, the costs, the disruptions, and the incalculable damage lead me to but one conclusions: the Senate must pass this legislation before the Congress adjourns.  November 16th, 1983.

So Senator Baker, known to many as the Great Conciliator, got everyone together and got it done, a trademark throughout his career.  Going even further back in the NY Times backlog:

THE WHITE HOUSE CRISIS: MAN IN THE NEWS; The Great Conciliator: Howard Henry Baker Jr.

Some quotes to describe Senator Baker and the leadership he brought to Congress during that time.

''He's a genius at finding the compromise point and pushing it through,'' said Senator Jim Sasser, Mr. Baker's Democratic colleague from Tennessee.

And this one:

''I'm frank to say that I don't think we could have had the successes that we've had up there without his leadership,'' the President (Reagan) once told a reporter. 

Let's compare that with what we got.

"Get your ass in line." - John Boehner to House republicans.

"The American people will not accept an increase in the debt limit without significant spending cuts and reforms." - John Boehner, speaking to the American people who definitely would have accepted it as they had dozens of times before.

"The sad truth is the President wanted a blank check six months ago, and he wants a blank check today.  That is just not going to happen." - John Boehner, still speaking to the American people, apparently forgetting that he's talking about the Congressional budget already passed.

"You see, there is no stalemate in Congress.  The House has passed a bill to raise the debt limit with bipartisan support.  And this week, while the Senate is struggling to pass a bill filled with phony accounting and Washington gimmicks, we will pass another bill." - John Boehner, again, still speaking to the American people, playing fast and loose with the meaning of bipartisan and completely blowing the meaning of stalemate.

"Conciliation... sounds like French for 'make me your bitch.'  Compromise... sounds like Nazi for France." - libelous quote I just made up.

Ok, so needless to say, we didn't get the Congressional leadership in 2011 that we got in 1983.  But we did get a rating downgrade, a new crash in the stock market, and the chance at a genuine double-dip recession. I guess despite that, the CBO still sees unemployment dropping in a few years, so that's a positive.  Cycles will be cycles to some degree.

But that graph reminded me a little of another graph I sometimes see floating around my liberal circles:

That's a graph showing CO2 levels in the atmosphere over the last 450,000 years.  This one also has those relaxing waves rolling into shore, but it also has that "HOLY SHIT!!" spike to the last one.  More importantly, both spikes have self-infliction and denial in common.

When trying to piece together what happened with the 2008 crash, a lot of higher-ups in banking stated there was no way to predict that the crash would occur.  That's despite the fact that they pushed out crap loans in order to bundle them together into giant piles of crap to sell off shares so other people could invest in crap all while banks and insurance companies issued credit default swaps to protect those investment in pure financial crap.  

We did it, bankers definitely did it, government facilitated it.  But in the end, we all really enjoyed splashing around in a giant pool of our own feces for some reason.  Then when people showed us the pictures of us splashing in our own feces that they took on their phones, we tried to deny responsibility.  Just like when some people drive gas-fueled cars and use electricity from coal-burning plants and let industrial cow farms pump out massive amounts of cow-ass methane, then just shrug and say stupid things like "the jury is still out" or "climate change is cyclical" when looking at that CO2 spike.

We do these things to ourselves.  We take the course of nature, or economics, and we apply Britney Spears shaving her head to those cycles and make them so much worse.

Dammit, now I definitely have to close with a shot of Marcus Bachmann eating a corn dog just to get out of this funk.

Seriously, who makes that face when something quasi-phallic approaches your mouth?