Matthew Yglesias's Theory of the Obama Administration in 2010: Excessive Reliance on the Second Derivative
Two Ways Of Looking At The Job Market In March 2010: By Matthew Yglesias on Nov 6, 2011 at 1:32 pm Here’s the way I think the Obama administration saw it:
That’s a steep downturn at the end of the Bush administration followed by a sharp recovery. Verdict: Our crisis intervention measures worked, and the conditions for future growth are set. Here’s the way they should have seen it:
This is a steep decline at the end of the Bush administration, which slows and then ends. Verdict: Our crisis intervention measures worked, but now we’re at the bottom of a big ditch and need a new set of measures to climb back to the top.
Note that these are just two different presentations of the same US private employment data. Both valid glances at the situation, and indeed to a trained eye they’re perfectly equivalent. But the affect associated with them is quite different. Everyone knows better than to just naively project that current trends will continue, but the human mind has trouble not implicitly seeing momentum in these visualizations. In the first chart, things are on the upswing. In the second chart, things have just bottomed out. The second chart was a much better guide to future action.