Interesting chart from The Economist reporting on the international effort to ban cluster bombs.
According to the Cluster Munitions Coalition, a lobby group, 98% of those killed by cluster bombs have been civilians, and over a third have been children. Some countries, including Britain, the world’s third-largest user, are calling for exemptions for certain types of cluster weapons.
I can think of more wasteful ways to spend $200 - Skydive Orange - May 11, 2008
This is a test: The ability to incorporate external media content into a personal website is a great way to generate new traffic.
I’ve never seen the Chronicles of Narnia, but this digital short from SNL is a classic…
Political business cycles and the likelihood of a U.S. recession in 2008
Economic downturns rarely occur in the run up to general elections. In the ten presidential campaigns since 1968, only once has annual GDP growth been less than 2% in an election year (1980: -0.2%). Just twice has annual GDP growth been less than 2% in the year prior to an election year (1975: -0.2%, 1991: -0.2%) In all three of these cases the incumbent party was voted out of office.
Jimmy Carter was the only sitting president forced to endure negative annual economic growth in an election year (1980). The result? Carter lost to Ronald Reagan in an electoral landslide. Four years earlier in the 1976 election, however, Carter was able to take advantage of a hangover from the poor economic conditions of 1975 to narrowly defeat the incumbent, Gerald Ford. In 1992 Bill Clinton also benefited from economic woes. Even though the U.S. economy was well into recovery mode after the 1991 recession, Clinton kept the public’s attention on the recent slowdown. He defeated George H.W. Bush in part by reinforcing the message, “It’s the economy, stupid”.
Based on these occurrences it is no wonder why incumbents try their best to maximize the economic well-being of their constituents in the months leading up to elections. In nine of ten elections examined, the growth rate of disposable income (personal income minus taxes) in election years outpaced growth rates from the previous year. The only time it did not was in Carter’s failed reelection bid of 1980.
Average government spending (relative to GDP) also increases throughout the 4-year presidential term before pulling back after the election. In the short run, higher levels of government spending increase GDP and lower unemployment, thus raising consumer confidence.
The state of the economy on presidential election outcomes is clearly only part of a larger dynamic story. Voters appear to be, however, more forgiving when the economy is on a roll and their employment and consumption opportunities are greater.
Will there be a recession in 2008? It is certainly a possibility. The housing market continues to weaken and the price of oil continues to rise. While the real price of oil is at historic highs, however, the economy is not longer as dependent on cheap oil as it once was. This means that the U.S. economy of today is more resilient in absorbing the higher price of oil than it was in the inflationary 1970s.
The real question is whether losses in the housing market will eventually reduce aggregate consumption and investment. So far this has not been the case. Prediction markets have the probability of a U.S. recession in 2008 at around 46%. The same markets, in comparison, placed the probability of a U.S. recession in 2007 around 35% heading into the year.
If historic trends hold one thing is clear. The Bush administration will attempt to maintain solid economic growth (artificial or not) through the 2008 election cycle.
Written: November 19, 2007