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Wednesday, January 27, 2010
Corsi's Lame, Mendacious Defense
Topic: WorldNetDaily

Last week, the Cato Institute's Daniel Griswold penned an attack at NRO on Jerome Corsi's latest anti-globalism book "America for Sale," assailing its conclusions (claiming Corsi's protectionism makes him sound like Dennis Kucinich) and his factual errors. After an initial response at WND that included no actual rebuttal of any of the claims Griswold made, choosing to instead bash "free-trade Republicans" for daring to criticize him. As we noted, Corsi forwarded an initial response at WorldNetDaily that included no actual rebuttal of any of the claims Griswold made, choosing to instead bash "free-trade Republicans" for daring to criticize him.

Corsi has followed up with a lengthier, if only slightly more detailed, Jan. 26 WND column. Kicking off with attacks on Griswold, defending his own credentials, and highlighting what Griswold didn't write -- mendacious tactics repeated during his defense of his error-laden anti-Obama book -- it's not until the 24th paragraph that Corsi gets around to rebutting something Griswold actually did write, and a healthy chunk of that is defending his definition of when the current recession started because it conveniently absolves President Bush of most responsibility for it:

Yet, Griswold chooses to quibble about when the current recession began. He insists the National Bureau of Economic Research, "the accepted authority on the U.S. business cycle," puts the start of the recession at December 2007.

The National Bureau of Economic Research is a private, nonprofit research organization that is not part of the federal government and has never been appointed by the federal government to make official declarations of when recessions begin or end.

Pushing the start of the current recession back to December 2007 is a subjective determination that serves political purposes, allowing organizations like CNN to push blame for the economic downturn into the Bush administration, suggesting President Bush was responsible for the housing bubble that caused the recession.

I chose instead to use the more conventional and objective standard defined by economic statistician Julius Shiskin in the 1970s and commonly used by economists since then that a recession officially begins after two consecutive quarters of negative growth in GDP; this definition would set the start of the recession to December 2008.

To use Shiskin's definition of when a recession starts is not an error, as Griswold insists in his intentionally deprecating essay.

Just as convenient as Corsi's use of the Shiskin recession definition is Corsi's overlooking criticism of Shiskin's definition as simplistic and outmoded:

Ignorance about recessions has taken hold because of a simplistic idea that a recession is two successive quarterly declines in gross domestic product (GDP), a measure of the nation's output.

The idea originated in a 1974 New York Times article by Julius Shiskin, who provided a laundry list of recession-spotting rules of thumb, including two down quarters of GDP. Over the years the rest of his rules somehow dropped away, leaving behind only "two down quarters of GDP."

Like most rules of thumb, it's far from perfect. It failed in the 2001 recession, for example. At the time and until July 2002, data showed just one down quarter of GDP, leading policy makers to claim there had been no recession. Yet, later that month, revisions showed GDP down for three straight quarters. Complicating matters further, with the benefit of time, we now know that GDP actually zigzagged between negative and positive readings, never showing two negative quarters in a row.

The far more important issue in 2001 was the loss of 2.7 million jobs - more than in any postwar recession. Even taking into account labor force growth, those job losses were greater than in most recessions over the past 50 years.

That's why Corsi has so little respect among actual economists -- politics is more important to him than facts.

Posted by Terry K. at 11:09 PM EST

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