What is the “Misery Index”?
Rising rates of unemployment and inflation come with a cost!
The “Misery Index” is a quick and easy calculation devised by Arthur Okun, former professor of macroeconomics at Yale University. After serving on President John F. Kennedy’s Council of Economic Advisers, Okun gained national recognition as one of the original supply-side economists in the United States. He believed that economic and social misery is the by-product of rising rates of unemployment and inflation.
So, a nation’s misery index is equal to the sum of the current rate of unemployment and a worsening rate of inflation.
Although criticized for under-weighting the impact of social unhappiness caused by joblessness, future comparisons of the misery index to the rise in our country’s crime rate would prove to have a stronger correlation than with either rate alone. As forecasters continue to collect comparative data, the actual rise in our nation’s crime rate tends to lag about a year behind the rise in unemployment and inflation.
In other words, when a government fails to act responsibly, misery leads to more misery.
How to Stop Inflation and Lower Unemployment
Economists know that a rise in inflation, coupled with high unemployment, forces consumers to spend less and causes an overall economic slow-down . . . something that Washington has obviously ignored. In addition, our government has seemingly lost sight of “How to Stop Inflation” and “How to Lower Unemployment” through changes in monetary policy and reduced taxation.
The Obama administration continues to ignore the fact that the rich have much less incentive to create jobs when high marginal tax rates take a large fraction of their income.
Conversely, when those with less money are being compensated through government run entitlement programs, they simply have less incentive to work.
If history repeats itself, the vicious cycle of a growing misery index will lead to higher rates of inflation and higher rates of unemployment which could force our nation into a state of Hyperinflation. So, now is the time for all Americans to become proactive in nominating and electing political candidates who are dedicated to the Libertarian principals of acting in the best interest of the people at all levels of government.
Help us stop the Misery. Pledge your support to the Libertarian National Campaign Committee and protect the American Dream for your children and grandchildren.
