40-50.

Correction: I incorrectly wrote that the 40-50 number was a one-day figure, whereas the three day average was 43-48.

That's incorrect. It was simply that the three day average hadn't been incorporated into the chart yet. The 40-50 is a new three day rolling average.

Could it get worse for Obama? Last night Hannity said a poll would be released today showing Obama down eight points to Romney. I don't know other details, and haven't found it yet.

Posted by: Ace at 09:25 AM | Comments (238)
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I actually know this is a double-post, and that Drew mentioned it earlier.

But it's such a big thing I want it to have a headline.

Since I've been blogging I've noticed that all GDP estimates are biased towards the average. When the economy is growing, early estimates lowball the figure, and later estimates and final numbers put it higher; when the economy is faring poorly, early estimates highball the figure, and later estimates and final numbers put it lower.

Exception: When there is a huge growth spurt in one quarter, those estimates are usually overstated, highballed.

It's like there's some glitch in the algorithm that starts at a default rate of growth of 2.5%, and the algorithm resists deviations away from this.

Our first quarter growth rate was said to be 1.9%. Which is not good at all. Pretty damn bad, actually. But at least it's not 0%.

Well, it turns out it was pretty damn close to 0%.

Now, supposedly, the growth in Q2 was a pitiful 1.3%, which is awful, and is even lower than the 1.8% expectation by economists.

But how likely is it that 1.3% even holds up? Any bets it gets revised down to... less than zero?

First-quarter output was sharply revised down to a 0.4 percent pace from 1.9 percent.

Economists had expected the economy to expand at a 1.8 percent rate in the second quarter.

And 2010's fourth quarter was... yes, sharply revised down too, by almost a full percentage point.

In addition, fourth-quarter growth was revised down to a 2.3 percent pace from 3.1 percent, indicating that the economy had already started slowing before the high gasoline prices and supply chain disruptions from Japan hit.

The only thing here that comes close to helping Obama is the fact the recession turns out to have been worse than estimated, too:

Data released on Friday showed the 2007-2009 recession was much more severe than prior measures had found, with economic output declining a cumulative of 5.1 percent instead of 4.1 percent.

...

The economy needs to grow at a rate of 2.5 percent or better on a sustained basis to chip away at the nation's 9.2 percent unemployment rate.

But that doesn't really help him. For one thing, people are tired of excuses.

For another thing, a sharp downturn has usually been followed by a sharp upturn in the recovery phase -- the "V" shaped recovery people talk about (down sharply, then up sharply).

This is "L" shaped, down and then flat. It may in fact be a double-dip; we are on the verge of entering the Obama Recession. (BTW, Obama: Since you've proclaimed the recession ended two years ago, you really can't now claim this second recession is the same recession as the one you began with.)

So what's changed now?

Ironic "More Cowbell" picture from The People's Cube.

Posted by: Ace at 08:43 AM | Comments (205)
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I usually don't like these "coward!" screeds but this one is good.

The Democrats have to compromise. This idea is almost never mentioned in the media. The formulation is A credit downgrade would be disastrous, so the Republicans must cave.

Um, why? Granted that we'd sure like to avoid a downgrade, but why must the compromise come on the spending-cut side? By the polls, cutting spending is more popular than simply raising the debt ceiling (which is decidedly unpopular). In terms of electoral mandate, the Republicans ran expressly on cutting spending, and Obama and the Democrats did not expressly run on increasing spending 30% or raising taxes.

In addition, our mandate is much fresher. The "mandate" the Democrats may have had in 2008 seems all but repudiated.

So why is the onus on the Republicans?

BBA Trigger? Assuming the 2nd tranche of debt limit is preconditioned on the BBA passing Congress (I imagine), Flake would vote yes, he says.

I'm not clear on whether he demands a vote on it or demands passage. I'd sure rather have passage be the trigger.

Posted by: Ace at 07:46 AM | Comments (296)
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You know what? The current political drama is pluckin' my last nerve so much it sounds like bluegrass music. Need a little break.

Fun Video Friday

Is this something? more...

Posted by: LauraW at 07:25 AM | Comments (52)
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Just starting to get word of the changes after the House GOP caucus but it sounds like the 2nd part of the hike would be tied to passage of a BBA.

With Flake saying he's a yes, it's likely that Boehner can get it through the House.

As much fun as this has been, it's nothing compared to what's going to happen when they try and pass whatever deal Boehner and Reid wind up cutting. Any final deal is going to lose something or somethings that conservatives want to vote yes. They'll be trading GOP votes for Democrat ones in the House. Should be a blast!

FWIW- Club for Growth will remove it's opposition if "Balanced" is put back in.

Posted by: DrewM at 06:59 AM | Comments (132)
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A few minutes from now at the White House.

Why didn't he think of this sooner?

CNN says Harry Reid announced that he's filing cloture for his plan, so he can start moving that through the Senate early Sunday morning. It's been awhile since the Senate has actually done something, I wonder if they had to look up how to actually do this stuff in the rule book.

Meanwhile, GDP felt right the hell off the cliff.

GDP grew at a seasonally adjusted annual rate of just 1.3 percent in the second quarter, lower than expected, according to an advance estimate released by the Bureau of Economic Analysis on Friday. U.S. stock futures fell after the estimate was released.

GDP growth for the first half of the year was the weakest since the recession ended, the Associated Press reported. Real GDP was revised sharply downward from 1.9 percent in the first quarter to 0.4 percent.

Say it with me kids....UNEXPECTEDLY.

BREAKING: Obama says it's now clear any solution must be bi-partisan and be able to pass both the House and the Senate.

This is why he was ConLaw professor lecturer.

Comes out for some hybrid of Reid-McConnell.

Says he will support a smart and balanced (taxes!) mechanism to hold the government accountable. Is he signalling a shift on the two step increase in the debt ceiling?

Posted by: DrewM at 06:22 AM | Comments (257)
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OK, so now that we're on the precipice of being on the precipice, let's revisit Obama's statement about granny's social security checks possibly being cut off next week if we don't increase the debt ceiling.

First, we actually hit the debt ceiling sometime back in May, and the August 2nd "deadline" is really the day Treasury thinks it will run out of accounting gimmicks to paper it over.

Look, we all know TurboTax Timmah is creative. I'm sure he'll think of something ... that's what these people do. But granny's social security check isn't on the table. Yet.

Why, you ask? Because of the oft-maligned social security trust fund (SSTF), that's why. Now, it's true that the SSTF just holds I.O.U.'s from the government (right pocket, meet left pocket) but those IOUs are included in the debt subject to the debt ceiling.

Look here at the (PDF) Daily Treasury Statement. Scroll down. No, further.

Stop! Table III-C "Debt Subject To Limit" ... see that $9.7 trillion (mf'ing dollars ... how did we get to this place?) of debt held by the public? Well that's way less than the $14.3 trillion statutory debt limit at the bottom, right? The big difference is that thing called "Intergovernmental Holdings" ... $4.5 trillion, give or take.

Guess what's in there. Granny's damned social security check, that's what! (among other things).

The SSTF (just from memory) is roughly $2.5 trillion of the balance of Intergovernmental Holdings. So when Douglas Holtz-Eakin is absorbing all "mandatory spending" in current income, that's not exactly right. We can issue $4.5 trillion more of treasuries (presuming someone will buy them) and not broach the debt ceiling to service payments from these funds, including (again, IIRC) $2.5 trillion of social security payments.

So don't worry, oldsters. You'll continue to get paid and I'll continue to pay into the Ponzi scheme while we work this little impasse out. You can thank me later, but you should apologize to your grandkids in the same breath.

More, courtesy of the WaPo:

Older Americans do not intend to ruin America, but as a group, thatÂ’s
what theyÂ’re about. On average, the federal government supports each
American 65 and over by about $26,000 a year (about $14,000 through
Social Security, $12,000 through Medicare). At 65, the average
American will live almost 20 more years. Should these sizable annual
subsidies begin later and be less for some? ItÂ’s hard to discuss the
budget realistically if you ignore most of what the budget does.

Welcome to your health and welfare benefit plan with an army, folks. For as long as it can afford the army, anyway.

(Consider this the DOOM! post. Monty doesn't do DOOM! on Fridays, but DOOM! doesn't hew to a schedule)

Posted by: andy at 05:12 AM | Comments (304)
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Yesterday presidential candidate Jon Huntsman spoke to the enviroconservative group 'Republicans for Environmental Protection.' Huntsman was vague on specifics, but he sounded an awful lot like he was on the other side of this issue from most Republicans:

"Conservation is conservative."

"We will be judged by how well we were stewards of those (natural) resources," said Huntsman, a veteran of three Republican administrations who until this spring was President Barack Obama's ambassador to China.

"Conservation is conservative. I'm not ashamed to be a conservationist. I also believe that science should be driving our discussions on climate change," he added.

These aren't controversial remarks. If Chris Christie, Marco Rubio, Rick Perry and said them, we probably wouldn't think much of it. If they said they want science to drive the "climate change" discussion we would all hear a clear subtext: "Real science, not the ever-collapsing and ever-rebutted "science" of alarmists whose models do not actually model reality."

But for a candidate who already has the far Left of the Republican field staked out, a demand to respect "the science" sound an awful lot like what we hear every day from global warming researchers facing investigations for scientific misconduct. It's not likely to help Huntsman pick up votes. Which leads one to wonder why he said it.

Thanks to rdbrewer.

Posted by: Gabriel Malor at 03:43 AM | Comments (130)
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One person can make a difference. But most of the time they probably shouldn't.

Posted by: Gabriel Malor at 02:55 AM | Comments (122)
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Some background info the budget process relevant to the pathetic little near term cuts Boehner is talking about.

Foster lays it out.

... the main reason the cuts are back-loaded isn’t political per se, it’s mathematical. Current law assumes that spending on program x will increase at rate y every year for the next ten years. If you freeze spending on program x or even retard its growth, the real dollar value of the cut is thus greater in the out years. It’s as simple as that.

If a program is spending a billion dollars then it's assumed that it will grow x% (Truman North recently said 7% is assumed) a year. So if you cut that program $10 million you also save $10,700,000 the next year and $11,449,000 the year after that. Cutting $10 million NOW results in $32 million less spending over 3 years.

I remember this from the Reagan defense buildup. They talked about the expense of new weapon programs over the years. It was like a ship moving through the ocean. You had a bow wave and a stern wave. The bow wave represented research, development, fixing bugs and buying the new stuff. Like the wave from a boat, it got bigger each year. The stern wave (often overlooked) was operating and repairing the equipment. It didn't kick in until after the new stuff was bought but then it too got bigger each year - pretty quickly.

Cutting spending is like that in reverse.

Hey. I'm not happy about the level of Federal spending. But if you think we're going to cut 40% out of the budget in ONE YEAR... Getting rid of the annual deficit over the next 6-10 years (with the right guys in office) is more plausible - then we can start nibbling or slashing away at the outstanding debt.

And there's no point in arguing with me on this. I've exhausted all my expertise and will sit passively by and let your points roll over me unrefuted! (Red Eye comes on in 18 minutes)

Posted by: Open Blogger at 10:41 PM | Comments (92)
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