Flaw in US Data Overstates Growth, Productivity

[Celebration]

http://www.cnbc.com/id/33786428

(From NY Times)

A widening gap between data and reality is distorting the government’s picture of the country’s economic health, overstating growth and productivity in ways that could affect the political debate on issues like trade, wages and job creation.

The shortcomings of the data-gathering system came through loud and clear here Friday and Saturday at a first-of-its-kind gathering of economists from academia and government determined to come up with a more accurate statistical picture.

The fundamental shortcoming is in the way imports are accounted for. A carburetor bought for $50 in China as a component of an American-made car, for example, more often than not shows up in the statistics as if it were the American-made version valued at, say, $100. The failure to distinguish adequately between what is made in America and what is made abroad falsely inflates the gross domestic product, which sums up all value added within the country.

American workers lose their jobs when carburetors they once made are imported instead. The federal data notices the decline in employment but fails to revalue the carburetors or even pinpoint that they are foreign-made. Because it seems as if $100 carburetors are being produced but fewer workers are needed to do so, productivity falsely rises — in the national statistics.

[WannaJumpMyScooter]

1. and this is supposed to surprise us, ummmm

how?

[Barack_America]

2. This is deliberate, I'm sure.

And fascinating too, thanks!

[Barack_America]

3. Celebration, would you also consider posting this in GD?

This article highlights what appears to be a really big issue.

Thanks!

[Celebration]

4. okay n/t

[Celebration]

5. here it is

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x6968919

[Barack_America]

6. Already K&R.

;)

[TheWatcher]

7. Oh I'm SURE it's a "Flaw".

Try DESIGN.

They admit to the PROPAGANDA they feed us being LIES weeks after the fact, and just pretend it doesn't exist.

They think we are THAT Stupid.

[happyslug]

8. Reminds me of the old PA ton

Pennsylvania use to have its own definition of a ton of coal, 3000 pounds. The reason for this was to show that American miners were 1/3 less productive then other coal miners (Most used English short ton of 2000 pounds). Thus if an american miner mined 9000 pounds of coal, he was paid for three tons of production. Other workers that produced 9000 pounds were paid for 4 1/2 tons of production. The main reason for the PA ton was to cheat the workers, but it showed up in statistics based on those pay records.

Remember the old saying "Figures don't lie, but liars figure" and that is true about your story on increased productively (as while as my story of the old PA ton) liars are doing calculations to make themselves look at good as possible and all that produces is bad statistics.