Hannity, Fox & Friends crop Romer comments to claim she gave conflicting accounts on stimulus

Hannity crops Romer, says “it is no wonder the American people are losing trust in the president's ability to handle the economy.” From the February 17 edition of Hannity:

HANNITY: Well, this morning Christina Romer went off her talking points yet again. But this time she contradicted herself.

[begin video clip]

STEPHANOPOULOS: With unemployment still about 10 percent is the biggest bang from the stimulus behind us?

ROMER: Absolutely not.

[end video clip]

HANNITY: That is a far cry from what Romer was saying just last year. Let's take a look at this.

[begin video clip]

ROMER: Most analysts predict that the fiscal stimulus will have its greatest impact on growth in the second and third quarters of 2009 and by mid-2010 fiscal stimulus will likely be contributing little to further growth.

[end video clip]

HANNITY: Well, Dr. Romer, here we are in 2010 so I guess the stimulus has all but run its course. Now it is no wonder the American people are losing trust in the president's ability to handle the economy.

Fox & Friends crops Romer to claim “the numbers were fuzzy.” From the February 18 edition of Fox & Friends:

CARLSON: Well, maybe some people at the White House should also look into a little bit of a media coaching, training seminar because yesterday the numbers were fuzzy again. There was a lot more confusion when we were talking about the first anniversary of the stimulus package. Listen to one of the top financial advisers to the president, Christina Romer, as she talks about the impact of the stimulus.

[begin video clip]

STEPHANOPOULOS [February 17, 2010]: Is the biggest bang from the stimulus behind us?

ROMER: Absolutely not.

ROMER [October 22, 2009]: Most analysts predict that the fiscal stimulus will have its greatest impact on growth in the second and third quarters of 2009 and by mid 2010 fiscal stimulus will likely be contributing little to further growth.

[end video]

DOOCY: OK, so what's interesting -- we actually ran those sound bites backwards in time. The second one happened in October of last year and there she says that the biggest impact will be in this past calendar year. And that's what the administration was saying, you know, let's pass this thing so we get some bang for the buck. But now we're one year into it and suddenly yesterday morning on the anniversary of one year of the stimulus -- 'Oh no, no, no, the impact is going to be in the future and -- because people really don't feel it, you can understand why she'd spin it that way.

Fox & Friends also aired the following on-screen text:

In fact, Romer's was discussing different economic indicators

Romer was discussing “employment” when she said the biggest bang from the stimulus is “not” behind us. Both Hannity and Fox & Friends aired video of ABC News anchor George Stephanapolos asking Romer, "[W]ith unemployment still at about 10%, is the biggest bang from the stimulus behind us," and Romer responding, “Absolutely not.” But that was not the entirety of Romer's response, and indeed, her subsequent sentence makes clear the she was referring to the effect of the stimulus on “employment and the unemployment rate.” From the February 17 edition of ABC's Good Morning America: [portion aired by Hannity and Fox & Friends in bold]:

GEORGE STEPHANOPOULOS: So we heard in Jake's piece that, that a lot of states are just burning through this stimulus money. And with unemployment still at about 10%, is the biggest bang from the stimulus behind us?

ROMER: Absolutely not. So certainly, in terms of the level of the things we care about, like employment and the unemployment rate, those effects are gonna grow over time. And certainly, as, as you heard in the piece, how important one component of the fiscal stimulus has been, the state fiscal relief. It really has kept hundreds of thousands of teachers and firefighters and first responders on the job.

Romer was discussing GDP “growth” when she said “stimulus will have its greatest impact on growth in the second and third quarters of 2009.” During an October 22 Congressional hearing, Romer discussed forecasts for “GDP growth” and stated, “Most analysts predict that the fiscal stimulus will have its greatest impact on growth in the second and third quarters of 2009. And by mid 2010, fiscal stimulus will likely be contributing little to further growth.” As Romer has previously noted, “job growth will almost certainly lag the turnaround in real GDP growth” and “even once GDP begins to grow, it will likely still take longer for employment to stop falling and begin to rise.”

From Romer's testimony at an October 22, 2009, Joint Economic Committee hearing: [accessed via Nexis, portion aired by Hannity and Fox & Friends in bold]

ROMER: With predicted growth right around 2.5 percent for most of next -- the next year and a half, movements in the unemployment rate either up or down are likely to be small. As a result, unemployment is likely to remain at its severely elevated level.

This figure shows the quarterly average of the monthly change in payroll employment. The enormous declines over the last four quarters are graphic evidence of how horrible this recession has been for American workers.

Now, because the Blue Chip forecast does not exist for employment, we continue the graph here with a survey -- with consensus forecasts from the Survey of Professional Forecasters.

These forecasts suggest that payroll employment loss will slow substantially in the fourth quarter of this year and that payroll employment will likely turn positive in the first quarter of next year.

Importantly, as you can see from these numbers, employment growth is expected to be quite low, below about 100,000 per month, through the end of the forecast in the third quarter of 2010. All right.

Well, all forecasts are subject to substantial margins of error, and the errors are often particularly large at times like the present, when the economy is near an inflection point. For this reason, I think it's important to consider the risks to the forecast. First, there are reasons to think that GDP growth could be either weaker or stronger than the consensus forecast.

On the weaker side, one concern is the leveling out of fiscal stimulus. Fiscal stimulus has its greatest impact on growth around the quarters when it's increasing the most strongly. When spending and tax cuts reach their maximum and level off, the contribution to growth returns to roughly zero.

Now, this does not mean that the stimulus is no longer having an effect. Rather, it means that the effect is to keep GDP growth above the level that it would have been in the absence of stimulus but not to raise growth further.

Most analysts predict that the fiscal stimulus will have its greatest impact on growth in the second and third quarters of 2009. And by mid 2010, fiscal stimulus will likely be contributing little to further growth.

Related to this, continued tightness in credit markets is a concern. Quantity measures of lending and issues of corporate debt remain low, and small business owners in particular report significant credit tightness.

Hannity also crops Romer, Summers remarks to claim “mixed message on whether or not the recession was over”

Hannity: "[B]ack in December ... the president's top economic aides delivered this mixed message." Echoing a distortion that was previously forwarded on the December 14, 2009, edition of Fox & Friends, Hannity cropped comments made by Romer and White House economic adviser Larry Summers to claim they delivered a “mixed message on whether or not the recession was over.” From the February 17 edition of Hannity:

HANNITY: And tonight in “Hannity's America,” the White House just can't seem to get its stories straight when it come to the economy. Now remember back in December when on the very same day the president's top economic aides delivered this mixed message on whether or not the recession was over.

[begin video clip]

ROMER [On Meet the Press]: I think the president has always said and what I firmly believe you're not recovered until all those people that want to work are back to work.

DAVID GREGORY: So in your mind this recession is not over?

ROMER: Of course not.

LARRY SUMMERS, WHITE HOUSE ECONOMIC ADVISOR [On This Week]: Today everybody agrees that the recession is over.

[end video clip]

But both Romer and Summers said recession is over in terms of GDP and employment improvements lag behind GDP

Romer: We have “reached” the end of the recession, “at least in terms of GDP.” On the December 13 edition of NBC's Meet the Press, Romer said: “You know, there's the official definition, and that talks about just when do you turn the corner, when do you go from plummeting to, to finally starting to go back up? And I think we have, at least in terms of GDP, reached that point.” Romer went on to state that “for the people on Main Street and throughout this country, they are still suffering. The unemployment rate is still 10 percent.” From the December 13 edition of Meet the Press: [portion aired by Hannity in bold]

GREGORY: When is the recession over, do you think?

ROMER: You know, there's the official definition, and that talks about just when do you turn the corner, when do you go from plummeting to, to finally starting to go back up? And I think we have, at least in terms of GDP, reached that point. But I think the president's always said, and what I firmly believe, you're not recovered until all those people that want to work are back to work.

GREGORY: So in your mind, this recession is not over.

ROMER: Of course not. We have -- you know, for, for the people on Main Street and throughout this country, they are still suffering. The unemployment rate is still 10 percent. That's what--that's why the president was talking this week.

Summers also pointed to GDP when he said the recession is over. On the December 13 edition of ABC's This Week, Summers said: “Today, everybody agrees that the recession is over, and the question is what the pace of the expansion is going to be. These things happen in stages. First, GDP goes up. That has happened. Then, hours that are worked by workers who already have jobs go up. That's starting to happen. Then employment goes up. We got very close to that this year, this month, with only 11,000 jobs lost.” Summers added that “it will take a little longer for the unemployment statistics to come down.” From the December 13 edition of This Week: [portion aired by Hannity in bold]

STEPHANOPOULOS: And Mr. Summers, let me begin with you, and let's start with just the overall economic situation right now, especially on jobs. We saw that drop in unemployment in November, but private economists predict that unemployment is likely to head back up. Mark Zandi sees it peaking at about 10.6 percent next year. Others say it could go up to 11 percent. Is that in line with your forecast?

SUMMERS: George, here is what I know. We were talking about depression, we were talking about the financial system collapsing. Today, everybody agrees that the recession is over, and the question is what the pace of the expansion is going to be.

These things happen in stages. First, GDP goes up. That has happened. Then, hours that are worked by workers who already have jobs go up. That's starting to happen. Then employment goes up. We got very close to that this year, this month, with only 11,000 jobs lost. And then unemployment starts to come down. So these problems weren't made in a month or a year, and they are going to take a substantial time to solve. But what we can take satisfaction from is that we've walked back from the brink. And you know, forget what we say. Most professional forecasters are now looking for a return to job growth by spring.

Now, when job growth starts, more people are going to be looking for work, so it will take a little longer for the unemployment statistics to come down, but make no mistake, we were losing 700,000 a month when President Bush turned the economy over to President Obama. The number last month was 11,000.