At the Next Debate, Just Ask Candidates About These 5 Charts

 

I would run the next Democratic and Republican debates a bit differently. Instead of having moderator questions, I’d simply show the candidates important economic charts and let them comment on what they see. We’d quickly find out — I hope — who has real deep knowledge on key economic issues and challenges facing America.

Now as it turns out, the Obama White House just released its big annual economic report, which contains a bunch of great charts. Here are a few I plucked out that would make for great debate material, run Pethokoukis-style:

1) The report says, “Productivity growth is critical to the well-being of the American economy, its workers, and its households.” Actually, that understates it. But as the chart shows, even though the US has led other advanced countries in labor productivity growth in the 2000s, there’s been a steep and persistent decline, according to official measures:

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2) Market entry by startups — vital to innovation and productivity growth — has been declining in US for decades, while firm exits have been declining. So overall, business dynamism — the so-called churn or birth and death rates of firms — has been in persistent decline. What’s more, this decline has been across all sectors in the 2000s:

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3) The share of the US work force covered by state licensing has grown from less than 5% in the early 1950s to 25% by 2008. The growth is primarily due to the number of occupations that require a license, rather than employment growth within certain heavily licensed fields such as health care and education: 

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4) While private-sector research and development focuses on turning invention into innovative products and services for the market, government is “the majority supporter of basic research—the so-called ‘seed corn’ of future innovations and industries that generates the largest spillovers and thus is at risk of being the most underfunded in a private market”:

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5) Of course, there had to be an income inequality chart. As the report points out, “Until the 1980s, the United States experience was similar to other countries; as recently as 1975, the top 1 percent garnered a similar share of the income in the United States as in other G-7 countries. But since 1987 the share of income going to the top 1 percent in the United States has exceeded every other G-7 country in each year that data are available”: 

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OK, one bonus chart, this one on housing: “[When] excessive and primarily geared toward protecting the interests of current landowners — including their property values — land-use regulations decrease housing affordability and reduce nationwide productivity and growth. The presence of rents in the housing market, moreover, may also restrict labor mobility and exacerbate inequality. One main indication that land-use regulation gives rise to economic rents is that, in the aggregate, real house prices are higher than real construction costs, and this differential has increased since at least the early 1980s”:

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What charts would you like candidates to comment on?

There are 10 comments.

  1. Kozak Member

    fedbalancesheet1Federal_DebtHow about these…foreign 2_0foreign 5_0waiter bartender vs MFG LTMFull vs Part Time May_1_0_0part rate aug_1_0

    • #1
    • February 24, 2016, at 10:57 AM PDT
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  2. Chirp Inactive

    Kozak, would you mind providing the source of these graphs? The full-time vs part-time graph is blowing my mind, and I’d like to verify it.

    • #2
    • February 24, 2016, at 11:02 AM PDT
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  3. SParker Member

    I’m good with most anything but trade balances. Except in years when Steve Forbes is running, it’s painful to listen candidates try to reason about them. And the Donald has already won high marks for being brilliantly obtuse (and painful) on the subject. How about Ron Paul’s purchasing power of the USD since 1913?

    • #3
    • February 24, 2016, at 11:17 AM PDT
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  4. Theodoric of Freiberg Member

    Chirp:Kozak, would you mind providing the source of these graphs? The full-time vs part-time graph is blowing my mind, and I’d like to verify it.

    Notice that the full-time vs. part-time graph does not start at zero on the y-axis which makes it look MUCH worse than it actually is. Also, it appears that the full-time jobs scale uses the left axis whereas the part-time job scale uses the right axis — and they have completely different scales.

    Here’s probably a better depiction of reality based solely on the data in the given graph:

    Screen Shot 2016-02-24 at 2.39.40 PM

    The Labor Force Participation Rate and the People not In Labor Force graphs don’t start at zero either. Using a non-zero starting point magnifies the issues.

    • #4
    • February 24, 2016, at 11:43 AM PDT
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  5. Chirp Inactive

    Theodoric of Freiberg:

    Chirp:Kozak, would you mind providing the source of these graphs? The full-time vs part-time graph is blowing my mind, and I’d like to verify it.

    Notice that the full-time vs. part-time graph does not start at zero on the y-axis which makes it look MUCH worse than it actually is. Also, it appears that the full-time jobs scale uses the left axis whereas the part-time job scale uses the right axis — and they have completely different scales.

    Doy, I’m a dork. I do database analytics for a living and I didn’t even bother to check the axes. Thanks!

    • #5
    • February 24, 2016, at 11:54 AM PDT
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  6. Kozak Member

    Chirp:Kozak, would you mind providing the source of these graphs? The full-time vs part-time graph is blowing my mind, and I’d like to verify it.

    Zero Hedge.

    • #6
    • February 24, 2016, at 11:58 AM PDT
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  7. Chirp Inactive

    Kozak:

    Chirp:Kozak, would you mind providing the source of these graphs? The full-time vs part-time graph is blowing my mind, and I’d like to verify it.

    Zero Hedge.

    Thanks, I’ll look into it

    • #7
    • February 24, 2016, at 12:35 PM PDT
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  8. Ekosj Inactive

    Hi Chirp!

    The Full Time Job portion of Kozak’s chart apoears to be data from thr BLS Household Survey….Employed-Usually Work Full Time.

    You can get the actual data from the St Louis Fed’s website FRED

    That particular data set happens to be my go-to number on employment and I know it by heart … Go to the FRED website and search for data series LNS12500000.

    I assume there is a counterpart – Employed-Usually Work Part Time available there as well. But I don’t know the series number for that one.

    • #8
    • February 24, 2016, at 3:27 PM PDT
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  9. Tuck Inactive

    Pethokoukis finally touches on how regulation is harming the economy! It’s a start.

    “government is “the majority supporter of basic research—the so-called ‘seed corn’ of future innovations and industries that generates the largest spillovers and thus is at risk of being the most underfunded in a private market”:

    Yeah, it’s not seed corn. It’s mostly wasted, like all gov’t spending. The biggest source of R&D spending is defense, and I think it’s pretty safe to say they massively overspend. We’d be better off building new copies of older tech than developing new, poorly thought out tech for the Chinese government.

    Next is: “Health R&D rose from 10.7 percent of total federal R&D spending in 1986 to 24.8 percent in 2011.”

    80/90% of health research is wrong. We’d probably save an enormous amount just by gutting that.

    • #9
    • February 24, 2016, at 6:47 PM PDT
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  10. Dan Hanson Thatcher

    “government is “the majority supporter of basic research—the so-called ‘seed corn’ of future innovations and industries that generates the largest spillovers and thus is at risk of being the most underfunded in a private market”

    How much money the government throws at something is not a good measure of how effective it is. On balance, I suspect that government funding of science is horribly inefficient, and in some cases counter-productive.

    Real innovation comes from a large quantity of people with different backgrounds researching things that interest them. Government funding tends to consolidate research into large firms and large facilities, and to an extent replaces a vibrant, stochastic search across many avenues with one directed by smaller groups of people.

    When you don’t know what you don’t know, the most productive way forward is to enable as many different exploration paths as possible. The market does that very well, which is why capitalist systems outperform statist systems dramatically when it comes to innovation and discovery.

    I will make very few exceptions for forms of research that require the types of funds or land commitments simply not available to private actors. LIGO, CERN, and NASA’s deep space exploration projects come to mind. But these grand projects are a small part of the science budget, which in turn is much smaller than the amount of money spent on basic research in private industry.

    • #10
    • February 25, 2016, at 1:25 AM PDT
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