Fact-Checking the Romney Campaign
On June 13th, Mitt Romney policy director Lanhee Chen posted a blog on the Romney web site titled “Taxed and Spent: American Workers Suffering Under Obama”. Following is the first paragraph:
President Obama’s policies have failed the American people. And nowhere has this failure been more evident than in this Administration’s handling of our nation’s economy. In the month that President Obama was inaugurated, the unemployment rate was 7.8%, the national debt stood at $10.6 trillion, and the average price for a gallon of gas was $1.83. Today, in the third year of his presidency, unemployment has ballooned to 9.1%, the national debt tops $14 trillion, and Americans are paying double—$3.70 a gallon—for gas.
These numbers are accurate insofar as they go. The Federal Reserve web site shows that the employment rate was 7.8% on January 1st, 2009 and is 9.1% as of May 1st, 2011. Note, however, that the unemployment rate reached 9.4% in May, just four months after Obama was inaugurated, and reached the maximum of 10.1% in October, just nine months after.
As I previously discussed in “Job Growth under Bush and Prior Presidents”, it makes far more sense to allow some time lag for economic policies to take effect and/or to measure that effect over full business cycles. According to the National Bureau of Economic Research (NBER), the recession ended in June of 2009. The unemployment rate was 9.5% at that time, and has improved since then. This improvement can be seen in the graph below.
The graph also shows that unemployment was already on a steady rise at the time of the Obama inauguration (red line).
Looking at the numbers on TreasuryDirect, the national debt was about $10.6 trillion on January 20, 2009 and is now about $14.3 trillion. As with the unemployment rate, it makes sense to allow a time lag. The policies for fiscal year 2009, which ended on September 30, 2009, were proposed by President Bush and passed by the existing Congress. The prior link shows the national debt on October 1, 2009, the first year of Obama’s first fiscal year, to have been $11.9 trillion, a full $1.3 trillion above the number given on Romney’s blog. This seems like the earliest point at which Obama’s performance should be measured. As with the unemployment numbers, it can even be argued that the first two years, 2009 and 2010, should to be skipped or ignored as they are heavily affected by prior economic policies.
Finally, the U.S. Energy Information Administration and zFacts both suggest that Romney’s claims regarding the price of gasoline are accurate. But note in the zFacts graph that the price was $4.26 per gallon on July 7, 2008, just a few months before Obama’s inauguration, and happened to have been near a local low at inauguration. In addition, the recent rise is corresponds with the recent conflicts in Libya and other oil-producing states. Thus, it seems difficult to draw any conclusions of Presidential culpability in the change in gas prices.
All of above shows how important it is to look at statistically significant data sets for economic causality, rather than just a few, isolated numbers. This is especially true when the numbers and causal accusations come from a partisan source, who may have cherry-picked or otherwise manipulated them.
- Romney the jobs-destroyer goes after Obama on manufacturing jobs (dailykos.com)
- Romney Says He’s Unemployed, DNC Slams Him as ‘Out of Touch’ (blogs.abcnews.com)
- FACT CHECK: Romney miscasts economy in GOP debut (sfgate.com)