Economist and CEA head Greg Mankiw was recently batted about for noting the obvious, that the international outsourcing of jobs is a good thing. He had to quickly recant, claiming that what he really meant was that trade "creates jobs".

In an election year, employment and unemployment are perhaps the most fathomable of economic indicators. Yet, for about as long as there have been national income statistics, there have been discussions about their limits. Lawrence W. Reed recently offered a nice discussion of some of the problems.

Today's NY Times (p. BU 6) includes a summary of reasons why the two BLS surveys (of households and of businesses) differ. There are many reasons, including the hard-to-estimate growth of off-the-books work.

An interesting elaboration is by Virginia Postrel in today's NY Times Magazine ("Sure, the country is losing manufacturing jobs, but who's counting all the ones it's gaining among manicurists and spa workers and graphic designers?").

It is likely that even Alan Grenspan and the Fed's Board of Governors and their large and able staff only have a hazy idea of economic conditions. How, then, can they manage the money supply and economc growth? They probably cannot. The real question is whether their actions do more to dampen than to deepen economic ups and downs.

Interestingly, Milton Friedman (of all people!) recently wrote in a WSJ op-ed that the Fed is now doing a pretty good job.