Do I Deserve A Wedgie?

Posted by: Michael Mandel on March 01

I’ve just published an article in BW which rounds up a lot of comments about my cover story, Unmasking the Economy, including one person who thinks that I deserve a wedgie (someone else thought I deserved an atomic wedgie, but we won’t go there). I’d be interested in hearing what people think.


Here are the links to some of the comments cited in the story, plus some additional ones.


Tom Peters: Absorb It!

Athena Alliance: Missing intangibles - Business Week

Brad Setser: Mandel vs. Setser. Round Two. More on Intangible exports and dark matter

The Stalwart: Exports and Intangibles

Brad Delong: What Are America’s Intangible Exports?


CJRDaily:BusinessWeek Has a Big Idea


The Big Picture: BusinessWeek Cover Story: Disingenuous or Denial?

The Big Picture: Dark Matter Revisited

WSJ Online: Is ‘Dark Matter’ in the Deficit?

Ricardo Hausmann: U.S. AND GLOBAL IMBALANCES:CAN DARK MATTER
PREVENT A BIG BANG?

Cafe Hayek: On Americans’ Consumption and Savings

More below:

Paul Krugman:Debt and Denial

Angry Bear: Low R&D in the UK: Calling Michael Mandel

Angry Bear: Don’t Fret over Deficits – Creative Accounting to the Rescue

Angry Bear:The Savings Debate: Mandel v. Setser

New Economist: Mandel versus Setser: Intangibles and the US economy

The Economist: Getting a Grip on Prosperity

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Reader Comments

Lord

March 3, 2006 12:44 AM

1. US companies may be making these investments, but they aren't necessarily investments in the US. 2. Much of this investment merely counters depreciation.

Still, we really do need to account for these and how they change over time if we want to know where the economy is headed.

monkyboy

March 3, 2006 03:17 AM

Here's a peek at how Microsoft is creating its dark matter:

http://www.komo4.com/stories/42127.htm

Look's more like brown matter to me...hehe.

David Barry

March 4, 2006 10:05 PM

To Michael Mandel:

Take 28 steps backward to page 26, where Jon Fine notes that producers of L Word are using user input to write the scripts -- at low cost. So, printing thoughtful blog comments achieves the same benefits for Businessweek. We readers like to see what other readers are thinking.

Hazel Henderson

March 5, 2006 12:10 PM

Michael Mandel has done another service to BW readers , along with his other original commentaries on the way the USA measures Productivity. I particularly concur with the need to change the category of education from consumption to investment and have called for this change for many years. Additionally, GNP/GDP need to have asset accounts, rather than the purely "cash flow" approach of today , as a group of statisticians of "sustainability
' and "quality of life" have been arguing for years ( see my editorial for InterPress Service ," Statisticians of the World Unite !" at www.HazelHenderson.com click on Editorials ).
Hopefully, this broader debate about overhauling national accounts can finally begin in the USA as it has been raging all around the world !

Wes

March 6, 2006 12:26 PM

I enjoyed your BW article I read yesterday. I'm already a subscriber for life but that article would have convinced me to be if I wasn't already. It was refreshing to see comments and feedback about your article.

In short - you don't deserve a wedgie, although I was laughing when reading that comment.

Good article and great debate you have caused.

ted schizas

March 6, 2006 10:24 PM

None of your critics offered a viable alternative or a viarifable process to measure your metirics. What you did do is create an awareness to review or search for a new varifiable process.
You are moving foward in time while the critics mark time.

Brandon

March 7, 2006 08:46 AM

I would be interested in your comments on the following article:
http://moneycentral.msn.com/content/P146055.asp

The article discusses the faults in the methods used by the government in its various economic reports. Briefly, it goes into how unemployment could just as easily be reported as 8.4% (rather than 4.7%), and how inflation may be deeply understated thanks to hedonics, among other things. If This is even partially true, it would greatly change the GDP numbers being reported (not to mention explain why the economy and job markets do not "feel" as good as the government's numbers claim).

Looking into the BLS sites I found several government reports on introducing more and more hedonics into the CPI calculations; substitutions that can easily underreport CPI. I also located a report by the New York Federal Reserve that had its doubts about the use of this technique and distortions it may cause. So I know I'm neither mad nor dealing with conspiracy theorists. It's being done, it's causing distortions of SOME sort, and it's being ignored by the popular press and, it seems, mainstream economists.

Why? I can only speculate that mainstream journalists generally have no idea what all these economic numbers mean, or how they're calculated, and just want a nice sound bite. The bull-market cheerleaders at CNBC are the last people to acknowledge a problem. How about economists? Most economists have a vested interest in an economic system they've championed for a century working out; even if it means fudging the numbers.

I would be interested in your opinions on this, and I do believe they have relation to the arguments you're making with Unmasking the Economy.

Bob

March 21, 2006 12:55 PM

I found your article cogent and articulately presented. I don't know whether the information is correct or not. The article caused me to think about the issues and provoked a discussion.
The did not feel the same of the responses by your detractors.
Well done!

Thank you for your interest. This blog is no longer active.

 

About

Michael Mandel, BW's award-winning chief economist, provides his unique perspective on the hot economic issues of the day. From globalization to the future of work to the ups and downs of the financial markets, Mandel-named 2006 economic journalist of the year by the World Leadership Forum-offers cutting edge analysis and commentary.

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