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The Economics of Abbott and Costello

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ABBOTT COSTELLO
AP
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Unemployment as reported is at 9 percent. But it's actually more than 16 percent. Some smart statistician came up with a distinction. A slight of hand to make the unemployment number tolerable rather than frightening. The concept was simple: 9 percent are unemployed and are actively looking for work. The 16 percent includes those who gave up and are no longer actively looking for work. So those casualties are no longer counted. They cease to exist. The 9 percent is a fake. A sham. And worthy of an Abbott & Costello routine. If that great comedy team were still alive, the routine on our unemployment woes might go something like this.

COSTELLO

I want to talk about the unemployment rate in America.

ABBOTT

Good Subject. Terrible Times. It's 9%.

COSTELLO

That many people are out of work?

ABBOTT

No, that's 16%.

COSTELLO

You just said 9%.

ABBOTT

9% Unemployed.

COSTELLO

Right 9% out of work.

ABBOTT

No, that's 16%.

COSTELLO

Okay, so it's 16% unemployed.

ABBOTT

No, that's 9%...

COSTELLO

WAIT A MINUTE. Is it 9% or 16%?

ABBOTT

9% are unemployed. 16% are out of work.

COSTELLO

IF you are out of work you are unemployed?

ABBOTT

No, you can't count the "Out of Work" as the unemployed. You have to look for work to be unemployed.

COSTELLO

BUT THEY ARE OUT OF WORK!!!

ABBOTT

No, you miss my point.

COSTELLO

What point?

ABBOTT

Someone who doesn't look for work, can't be counted with those who look for work. It wouldn't be fair.

COSTELLO

To who?

ABBOTT

The unemployed.

COSTELLO

But they are ALL out of work.

ABBOTT

No, the unemployed are actively looking for work... Those who are out of work stopped looking. They gave up. And, if you give up, you are no longer in the ranks of the unemployed.

COSTELLO

So if you're off the unemployment roles, that would count as less unemployment?

ABBOTT

Unemployment would go down. Absolutely!

COSTELLO

The unemployment just goes down because you don't look for work?

ABBOTT

Absolutely it goes down. That's how you get to 9%. Otherwise it would be 16%. You don't want to read about 16% unemployment do ya?

COSTELLO

That would be frightening.

ABBOTT

Absolutely.

COSTELLO

Wait, I got a question for you. That means they're two ways to bring down the unemployment number?

ABBOTT

Two ways is correct.

COSTELLO

Unemployment can go down if someone gets a job?

ABBOTT

Correct.

COSTELLO

And unemployment can also go down if you stop looking for a job?

ABBOTT

Bingo.

COSTELLO

So there are two ways to bring unemployment down, and the easier of the two is to just stop looking for work.

ABBOTT

Now you're thinking like an economist.

COSTELLO

I don't even know what the hell I just said!

ABBOTT & COSTELLO did a comedy routine about fictitious ball players called "Who's On First?" The absurdist number of the real unemployed is not a joke.