Press reports about the prediction by President Obama's Council of Economic Advisers that the economy would add an average of 95,000 jobs per month during calendar 2010 weren't exactly overflowing with praise, but were lacking in something one would have expected: historical context.
Philip Elliott's Associated Press report provided none. Sewell Chan's New York Times coverage at least pointed out that the promised level of job growth was "barely enough to keep up with the normal number of jobs the economy would have to create to meet the growth in the labor force and keep the unemployment rate steady."
But how would what the administration predicts compare to previous recoveries? As seen in the following chart based on more detailed information here, all based on data from the government's Bureau of Labor Statistics, a 95,000 per month performance in job growth following a breakout quarter after a recession wouldn't exactly be impressive:
With Reagan, the question is whether you peg the economy's breakout as the first or second quarter of 1983, when annualized growth was 5.1% and 9.5%, respectively. Regardless of which quarter you pick, the supply side tax cut-driven performance was spectacular. In fact, in one month (September 1983), the economy added almost as many jobs (1,114,000) as Team Obama predicts will be added during all of 2010 (12 x 95,000 = 1,140,000). Too bad it took the Gipper so long to get the cuts through Congress.
The performance after Bush 43's breakout 6.9% second quarter of 2003 was far less impressive -- but then again, so was the relative size of the 2003 income and investment-related tax cuts in comparison to Reagan's. Nevertheless, what Democrats at the time were calling the worst economy since Herbert Hoover added 1,603,000 jobs during the next 12 months. That's an average of 134,000 per month, which is 41% greater than the 95,000 per month Obama's Council of Economic Advisers is predicting.
So what's going on here? I would suggest that the administration, seeing mediocrity everywhere despite what is supposed to have been its own breakout quarter (5.7% in the fourth quarter of 2008) and despite their bitterly clinging to the supposed superiority of Keynesian stimulus over supply-side tax cuts, is lowering the bar to something that has at least an outside chance of occurring.
This bunch also hopes that historical reviews such as the one just done above exposing just how pathetic their expectations are won't become widely known. Sadly so far, the press is cooperating to ensure that.
Cross-posted at BizzyBlog.com.