Rush Limbaugh's GDP TrutherismJuly 31, 2013 4:38 PM EDT ››› CRAIG HARRINGTON & ALBERT KLEINE
Rush Limbaugh accused the Obama administration of "cooking the books" to show increased economic growth during the last five years, a claim that completely ignores the facts and rationale behind GDP revisions.
On July 31, the Bureau of Economic Analysis (BEA) released its report on U.S. gross domestic product, which showed the economy growing at 1.7 percent for the second quarter of 2013. In its report, the BEA noted that a "comprehensive revision" in calculating GDP was implemented "for improving and modernizing its accounts to keep pace with the ever-changing U.S. economy." The revisions generally resulted in upward estimates for national GDP, in addition to higher than previously estimated annual growth rates.
Reacting to the report and revisions on his radio show, Limbaugh forwarded the notion that the Obama administration was "cooking the books," claiming that the revisions were only implemented to paint a rosier picture of the economy under Obama.
Limbaugh's suggestion has no basis in reality.
While Limbaugh claimed that upward revisions were only applied for years during the Obama administration, the BEA clearly notes in its report that GDP figures dating back to 1929 were also recalculated:
For 1929-2012, the average annual growth rate of real GDP was 3.3 percent, 0.1 percentage point higher than in the previously published estimates. For the more recent period, 2002-2012, the growth rate was 1.8 percent, 0.2 percentage point higher than in the previously published estimates.
Additional revisions were made to the most recent five years of data to reflect new and better data sources that have emerged since initial estimates. But while Limbaugh falsely suggests this was done solely to improve the numbers for the Obama administration, revisions applied to 2007 through 2012, including two full years prior to Obama's first inauguration.
Beyond Limbaugh's blatant disregard for the facts about the timeline of the revisions, he also failed to realize that revising the formula for calculating GDP is a routine procedure intended to help the government more accurately track economic development over time. According to the BEA, "comprehensive revisions" are "carried out about every 5 years" to more accurately reflect the economy. And in an interview with Bloomberg News, Brent Moulton, associate director for national economic accounts at the Bureau of Economic Analysis, stated, "Despite the conceptual changes, we have not rewritten economic history."
Furthermore, the BEA has maintained a high degree of media transparency regarding the revisions. In an April 26 Wall Street Journal article, BEA Director Steve Landefeld was forthright with his agency's upcoming analytical revisions. From the Journal:
At the end of July, when the bureau issues its first cut at second-quarter GDP, it also will be completing a sweeping benchmark revision of GDP estimates going back to 1929. Mr. Landefeld has presided over a number of benchmark revisions, which happen every four to five years. He said the 2013 changes, which will introduce the capitalization of business and government spending on research and development, are up there in significance with the 1999 revisions, when computer software first was included in GDP.
Right-wing media often engage in trutherism over positive economic reports, consistently arguing that the Obama administration is attempting to mislead on the state of the economy. Limbaugh only adds another chapter to this series.