Tuesday, December 21, 2010

Uh, I believe the federal employment trend is upward, Paul

Gee, it seems that Paul Krugman has found a new word to describe people who might actually believe that the Law of Marginal Utility applies to money and to economics in general: Zombie. In a recent blog post, he claims to be able to debunk the "myth" of "soaring federal employment," and, thus, label anyone who disagrees a "zombie."

Krugman's "proof" is the graph below, which does show that in Census years, there are temporary spikes in government employment. However, we still can see a significant growth (even without the Census workers) in federal employment since Obama took office.

As I see it, this significant increase demonstrates what many of the "zombies" (including me) have been saying: the government's policies of the last two years have turned the federal government into the only "growth" industry in the country. Furthermore, the addition of literally hundreds of thousands of government employees does nothing but increase the economic burden on everyone else.

So, who is the zombie? Could it be the guy who believes that an addition of government to be paid by everyone else is an economic "stimulus"? Oh, I forgot. "Sophisticated" economists have repealed the Law of Scarcity and the Law of Opportunity Cost.

32 comments:

AP Lerner said...

Uh, I believe Prof. Anderson (and Krugman) need to learn how to read a chart and but their biases aside and learn how to interpret data.

This graph shows federal, state, and local employment as a % of the civilian population since 1976. federal government employment has shrunk, state mostly flat, and local up.

http://calculatedriskimages.blogspot.com/2010/09/government-employment.html

This shows state employment ex education.

http://calculatedriskimages.blogspot.com/2010/09/government-employment-ex-education.html

So ALL government employment has shrunk as a % of the civilian population except for educators employed by states. And who pays Prof. Anderson salary? Bingo. So really, Prof. Anderson is not just part of the problem, he is the problem.

I have never seen such consistantly bad and biased analysis.

AP Lerner said...

I'm sure some know it all poster will point out the above charts run until Jan 2010. Fine. Here's the data for this year.

Government employment as of Nov. 2009 = 21,233
Government employment as of Nov. 2010 = 20,590

http://www.bls.gov/news.release/empsit.t08.htm

Same story as my charts above.

Daniel Hewitt said...

AP Lerner,

The chart in the original blog post is clear enough. How did Dr. Anderson read or interpret it incorrectly?

A more troubling question - why is the BLS chart so different from the Fed chart that Krugman posted yesterday?
http://krugman.blogs.nytimes.com/2010/12/20/birth-of-a-zombie/ They both track the same metric!

Speaking of bias, any reason why you are posting data that uses "Civilian noninstitutional population" as its denominator?

The BLS' definition:
"Civilian noninstitutional population (Current Population Survey)
Included are persons 16 years of age and older residing in the 50 States and the District of Columbia who are not inmates of institutions (for example, penal and mental facilities, homes for the aged), and who are not on active duty in the Armed Forces."
http://www.bls.gov/bls/glossary.htm#C

You do make a good point regarding state-funded education. It should be abolished.

Mike M said...

AP,
I know how to read charts so let me tell what I see in your chart. NO material increase in productivity. The private sector would expect to be doing more with less given the increase in technology advancements in the workplace and general knowledgebase etc.

AP Lerner said...

"How did Dr. Anderson read or interpret it incorrectly?"

Let's try this another way. The graph Krugman is showing includes Census workers. I’m stripping them out since, you know, the Census is mandated by the Constitution. So when Prof. Anderson claims "Uh, I believe the federal employment trend is upward, Paul" he is 100% wrong, and when he claims "the government's policies of the last two years have turned the federal government into the only "growth" industry in the country" this is 100% false

Government employment on Jan 2009 21,142
Government employment on Nov 2010 20,745.

http://data.bls.gov/PDQ/servlet/SurveyOutputServlet

So not only does the data show Federal employment is DOWN since Obama was elected, it shows the long term trend is stable to DOWN as a % of the labor force. The real data shows the ONLY growth in overall, total government employment growth has been Prof. Anderson's field...state education.

Now, is this bad analysis or ideologically driven intentional deception on the part of Prof. Anderson? Hard to tell at times. Maybe this post is tongue and cheek as well. Who knows. You be the judge. But yes, I get frustrated by the repeated attempts to make up facts (on this blog, and on Krugmans).

"A more troubling question - why is the BLS chart so different from the Fed chart that Krugman posted yesterday?"

BLS is ex Census..

"You do make a good point regarding state-funded education. It should be abolished"

Or maybe hire better teachers that know how to read data instead of teachers trying to indoctrinate their students with a narrow minded politically driven ideology.

"NO material increase in productivity."

Huh? By your rational, employment should be on a permanent trend down. Sounds like another biased interpretation.

Anonymous said...

AP Lerner, with all due respect, you should give some concession to the fact that it is difficult for everybody, including the smartest to read and understand charts and statistics properly. It's a difficult art, as my statistics professor has indicated. Both Krugman and Anderson must be forgiven.

Krugman himself has falsely concluded that there is a "shrinking" middle class, simply by assuming that mid-50% range of real incomes from the 1970s should show the same or higher number of people in the 2000s. Amazingly, he did not consider that the rightward shift of the income bell curve meant that the mid-50% of 1970s real incomes are now the bottom 20% of income bell curve. This mistake by Krugman in his political manifesto, Conscience of a Liberal, has been pointed out by many many economists.

Mike M said...

AP
“Huh? By your rational, employment should be on a permanent trend down. Sounds like another biased interpretation.”

There is nothing biased in it. I can give you biased if you want. I mean seriously, you need to be honest with yourself. Government is overhead. Beyond base line functionality it produces nothing, it has nothing and what it does have it must take from the productive sector first.
Look at your own chart again. Government should be on a permanent trend down as a percentage of the population and GDP. But it is not because that is not its nature. If it was a private business it would be trending down.

Now you can go ahead and make the argument (rationalization) that government can’t be held to the same benchmark at private industry because blah blah blah. And that’s the thinking that produces what we have today.

If I was appointed to the Board of Government Inc., I would fire these people after looking at your graph. They have made no material improvements in productivity based on the tools available in the marketplace.

If you want my bias it’s towards liberty always all the time. Government beyond minimal core services is the antithesis of liberty. Do you have a problem with liberty and recognition of the individual as soverign?

Mike M said...

Anonymous said:
“… Both Krugman and Anderson must be forgiven.”

I can’t tell, are you being generous or sanctimonious?

AP Lerner said...

"Both Krugman and Anderson must be forgiven."

No they should not. They both contribute to the rot that is called economic analysis these days.

"Government is overhead. Beyond base line functionality it produces nothing, it has nothing and what it does have it must take from the productive sector first."

This is the bias. And, I assume you believe the author of this blog should be fired as well, right? Please come out and say it if that's what you believe.

"Government should be on a permanent trend down as a percentage of the population and GDP."

And this is bad analysis. So, just to clarify, the same number of firemen should work in NYC today relative to 1950. And the same number of teachers should teach in a given district, regardless of the growth in population, right?

"I would fire these people after looking at your graph. They have made no material improvements in productivity based on the tools available in the marketplace."

Tell that to the 911 first responders.

"Do you have a problem with liberty and recognition of the individual as soverign?"

When your bias and faulty analysis become obvious, play the liberty card like a good Austrian/libertarian. Well done. I know, it's hard when the data refutes what you want to believe.

Mike M said...

AP
Spare me the transparent game of citing police, fire and teachers whenever someone questions the size of government. It’s a lazy tired response. Basic public safety is the primary order of government. Your nonsense about “firing the author of the blog” is a red herring. You know very well the discussion was about the macro relationship of the numbers.

I take offense to the accusation of “playing the liberty card.” You might think liberty is something to be used as a political punch line. I do not. Interesting you didn’t answer my question on what appears to be you problem with a system or philosophy that advocates maximum individual sovereignty. Or is that concept hostile to your political philosophy?

You have cited no data that refutes my position. I gave my interpretation of your chart from a business perspective.

Anonymous said...

I like how AP takes the outlier point at the begining of Obama's term as the starting point to show a decrease in government employment. Good show, sir.

AP Lerner said...

"It’s a lazy tired response."

What's lazy is ignoring reality. And the reality is the bulk of government employees are folks like Prof. Anderson, not some pencil pushing bureaucrat. So when you say " would fire these people after looking at your graph" what you are really saying is you would fire folks like Prof. Anderson.

"Or is that concept hostile to your political philosophy?"

My interests are markets and investing, not philosophy and politics.

"I like how AP takes the outlier point at the beginning of Obama's term as the starting point to show a decrease in government employment. Good show, sir."

Pay attention. See the very first comment I made. 1976 beginning date. I took the starting point of Obama's administration to refute this 100% false statement made by Prof. Anderson: "the government's policies of the last two years have turned the federal government into the only "growth" industry in the country"

Nice try.

AP Lerner said...

haha...right. Because liberty has everything to do with Prof. Anderson and others ignoring data and buying into the myth of exploding government employment.

Way to steer off topic when the facts stack up against you. Maybe, just maybe if you repeat the line 'government employment is exploding' three times while clicking your heels, Fox News will confirm the myth, and it will taken to be true by all.

That's a fantastic debate technique. I'll keep that in mind for the future.

Daniel Hewitt said...

Way to steer off topic when the facts stack up against you

AP, the graph in Dr. Anderson's original post has an upward trend, and all you have done today is tried to steer away from that.

So when you say " would fire these people after looking at your graph" what you are really saying is you would fire folks like Prof. Anderson.

Hehe, I do think that Dr. Anderson should be fired! Not because he is a bad person or a bad teacher, but because education is not a service that the state can deliver efficiently.

When your bias and faulty analysis become obvious, play the liberty card like a good Austrian/libertarian

Yet it's OK for you to wrap yourself in the flag instead of reply?

AP Lerner said...

"AP, the graph in Dr. Anderson's original post has an upward trend, and all you have done today is tried to steer away from that."

No, I have not. And the upward trend is irrelevant. See my very first post.

And one more time.

Prof. Anderson said: "the government's policies of the last two years have turned the federal government into the only "growth" industry in the country"

And of course, the data I pointed shows this is 100% false.

Government employment on Jan 2009 21,142
Government employment on Nov 2010 20,745.

http://data.bls.gov/PDQ/servlet/SurveyOutputServlet

I was steering people to that simple fact. And I was steering people away from the myth that government employment has been rising. It has not. I mean seriously, we have a lot of serious issue we could be debating, why do people insist on making things up?

"Hehe, I do think that Dr. Anderson should be fired!"

Well, at least you are consistent.

"Yet it's OK for you to wrap yourself in the flag instead of reply?"

Uh, I never wrapped myself in the flag. I never invoked liberty in a post where I was pointing out the misinterpretation and/or deception of the poster. I was providing the data that refuted Prof. Anderson posts. That is all. If others want to debate the evils/benefits of government employment well good luck. Not a debate I care to enter at this time.

Raphael said...

Who cares if it's under Obama's watch or GWB's watch? The one thing that the chart in Dr. Anderson's post shows is a clear rise in government employment of >200,000 employees since the start of 2008 to the current time (temporary census workers removed). 200,000 more federal workers does not mean that government employment is going down... I think that was the simple point that Dr. Anderson was trying to make.

Mike M said...

AP
I know it’s the holiday season and I should be more generous but I am beginning to think there is some form of irreparable intellectual damage on your part. I will type slowly this time.

I gave you my business interpretation of your graph. Period. I presented no facts because none was called for given that I used YOURS. I never said government employment was “exploding.” My comment was confined to its relationship to population and GDP growth and the lack of efficiency compared to the private sector. What part of this don’t you understand? If you want to disagree with the position, so be it. But get your facts straight.
It was not my intent to steer off the topic but only highlight your ignorance of the fact that markets, investments, politics and philosophy are interconnected. You may enjoy the luxury of isolating them in a test tube academic setting, but not the real world.

Richard M said...

AP,

Your figures of ~21million and ~20million include all government spending (fed, state, local), don't they? I mean, how do these numbers square with the graph Krugman posted (currently ~2.2 million), which is federal employment only, and is the 'growth' industry Dr. Anderson directly referred to?

Daniel Hewitt said...

AP Lerner,

Title of today’s post:
"Uh, I believe the federal employment trend is upward, Paul"

Evidence posted:
Graph of federal employment trending upward

Your conclusion:
You guys are making up facts



And by wrapping yourself in the flag, I mean responding to a challenge of government's economic productivity with "Tell that to the 911 first responders".

jason h said...

I'd be interested in seeing the ratio of government employees to private sector employees, not the ratio of gov't employees to total population as we know the private sector has been shedding jobs for the last few years.

If the private sector is shrinking faster than the govt, then one could argue that govt payrolls are growing relative to the private sector.

Nevertheless, Krugman's own chart demonstrates the opposite of his conclusion. Perhaps he should have normalized it to total population.

Richard M said...

Jason,

Also, the number of private employees whose jobs directly depend on federal government spending. I do not believe the first chart AP referred to includes those jobs either.

Lord Keynes said...

he government's policies of the last two years have turned the federal government into the only "growth" industry in the country

Then all these private sector jobs must be a figment of someone's imagination:

http://www.thefastlaneforum.com/general-business-discussion/28091-private-sector-job-growth-2008-2010-a.html

Bob Roddis said...

When are the Chartalists going to tell us where all of the stuff to satisfy all of this unpayable debt is going to come from?

I'm turning purple from holding my breath.

Oh wait, let's pick nits instead.

Mike M said...

Bob Stuff happens all by itself. Didn't you know that :-)

OK go ahead and breathe now please

burkll13 said...

there must not be a chart showing that, so it must be utterly irrelevant...

Richard M said...

LK,

The graph Krugman posted shows at least ~200K federal gov't jobs added since 2008.

Your graph of private job 'growth' clearly shows more private sector jobs lost than added over the same time period.

Anonymous said...

Instead of plotting absolute values, Krugman often plots the first derivative. This trick fools many of his followers.

It fooled Lord Keynes, who has posted a plot of the first derivative of private sector employment to counter the plot of the absolute value of federal government employment!

Lord Keynes said...

Your graph of private job 'growth' clearly shows more private sector jobs lost than added over the same time period.

And the majority of those job losses occurred before the stimulus passed in February 2009 in the greatest recession since the 1930s. So what did you expect? Positive private sector growth in a recession?

After the stimulus took effect, private sector jobs losses fell rapidly and went positive - precisely as predicted by Keynesian theory.

With one exception private sector job growth has been positive since December 2009.

Andersen's statement that "the government's policies of the last two years have turned the federal government into the only "growth" industry in the country" is rubbish.

David in Qatar said...

ROFL! I can't tell you how much I enjoy coming here and watching LK and AP Lerner get tossed like salads.

Bob Roddis,
You have been an inspiration to me and I have started investigating MMT on my own. It is as you describe, a hilariously bad acatallactic theory that does not hold up to scrutiny.

My thanks to you, and the many others here (I recall jason h. providing some fantastic points as well, but other particular names esacpe me. My apologies if you feel left out.)

You guys make this blog so much more enjoyable.

Richard M said...

LK,

"Andersen's statement that "the government's policies of the last two years have turned the federal government into the only "growth" industry in the country" is rubbish"

What do you call an industry that adds tens of thousands of employees during the most severe recession since the 1930's, and is still adding them, while every other industry lost hundreds of thousands of employees, and still have net jobs lost? Stagnant? (Not to mention, the average employee in this 'industry' receives higher wages and benefits, and enjoys larger pensions, than the average employee in the other industries)

And, of course only Keynesian theory would have predicted that if the government spent billions on stimulus (not to mention the ~1.1 trillion the Fed added to the monetary base) that that might stem private sector job losses, and even add some. Good one.

Anonymous said...

LK,

You mentioned the phrase "Keynesian theory". What's that? A theory of .... what?

ROFLMAO

Bala

Anonymous said...

This is cherry-picking, starting at 2000. Go back to 1990, which will show non-census federal employment at 3.1 million under George HW Bush. Employment dropped under Clinton. 68,000 were added in George W Bush's last year, but claimed to be under Obama. Obama's numbers are significantly less than Bush I or Bush II in terms to total, or added, employment.