Frankonomics

At least one economist at Rhode Island College, like too many of her academic counterparts, does not let trends in the economy cloud her economic views. “Contradictory economic rhetoric serves two political goals,” according to Ellen Frank. “First, half-baked but seductive arguments about finance enlist the general public in support of policies—like tax breaks for stock investing, restrictive monetary policy, federal and international debt repayment—mostly harmful to the public but beneficial to those with considerable wealth.”

“Second, obscure and confusing economic arguments about finance and money foreclose discussion or even consideration of policies that might generate a more egalitarian distribution of the economy’s output.” Frank is a senior economic analyst for the Poverty Institute at Rhode Island College. Evidently, she has never seen an economic indicator that she likes, at least in the last 25 years.

Apparently, Frank is making at least one reference to the tax cuts this president signed into law. The Joint Economic Committee of the U. S. Congress has some interesting information on the economy that these tax cuts helped to produce. As of September 2, 2005:

• Twenty-seven consecutive months of job gains have added over 4.1 million new jobs to payrolls.

• Payroll employment has increased by over 2.2 million over the year and over 1.5 million new payroll jobs have been created so far this year.

• The unemployment rate (calculated from the household survey of employment) edged down to 4.9% in August, from 5.0% in July. Last August, the unemployment rate was 5.4%.

• The unemployment rate is the lowest since September 11, 2001 and remains below the averages of each of the past 3 decades.

Additionally, a visit to www.bls.gov should give Professor Frank details on what happened to job growth and unemployment in the wake of the tax cuts signed by Presidents Reagan and Kennedy. What these figures will show is that jobs grew by millions while unemployment dropped.

One would expect a Poverty Center economist to be interested in both job growth and unemployment as the presence of the former helps to forestall indigence and the prevalence of the latter aids in defining it. Ironically, such assertions as Frank’s in the absence of accompanying fact frequently come from those academics who label conservatives “anti-intellectual.”

Malcolm A. Kline is the executive director of Accuracy in Academia.