I’m big footing on Zandar and his link to the UK Business Insider regarding this month’s positive job report, as there was an interesting line I want to pursue:
In a note to clients after the report, economists at Capital Economics wrote that the report “adds to the evidence that the US economy is regaining momentum after another winter slowdown.” [emphasis mine]
For some reason the 1st quarter of the past several years have been dismal even as the rest of the year is seeing trend or above trend growth. We really should be seeing massively above trend growth to close the gap in potential output, but we won’t get that with austerians, assholes, economic illiterates and sadists occupying a significant number of policy veto points, so trend to slightly above trend growth is probably the best we’ll get.
One of the drivers of the 1st quarter drops has been absolutely miserable weather. It has been the polar vortex, it has been snows that bury Boston as if it is Buffalo, it is drought and deluge. It is climate change acting as predicted. And then spring comes around and people dig out and go about their normal life again and things rebound.
Politically this is important because a good number of the fundamental presidential models argue that economic growth is a key component of an incumbent or incumbent party winning re-election. The perception of economic growth through which the marginal members of the electorate is not anchored on Halloween. Instead economic expectations for a Presidential election are anchored during the first or second quarter preceding the election. Everything else short of a helicopter drop of money takes too long and is not sure enough for people to conclude that the current baseline is the real baseline.
So if economic expectations are anchored during the preceding winter and we’re expecting more frequently ugly weather due to climate change, this is yet another positive feedback loop where we keep dumping inputs into the system that worsen the situation without any stopping mechanism.
Time to look for new land by Hudson Bay.
Jobs, lags, climate change and the 2016 electionPost + Comments (46)

