Picking and choosing when Wall Street counts as a metric

PICKING AND CHOOSING WHEN WALL STREET COUNTS AS A METRIC…. Over the first seven weeks of the Obama presidency, the Dow Jones Industrial Average, just one of many Wall Street indexes, dropped from 7,949.08 to 6,547.04. A wide variety of conservatives said this was necessarily evidence that the White House’s economic policies were a mess, if not an outright failure, and that the president didn’t know what he was doing.

The Wall Street Journal ran an entire editorial on this in early March. The drop in the Dow, the WSJ insisted, was a direct result of investors evaluating “Mr. Obama’s agenda and his approach to governance.” Karl Rove and Lou Dobbs made the same case. So did Rush Limbaugh, Sean Hannity, and Fred Barnes. John Boehner also pushed the line. It was one of Mitt Romney’s favorite talking points for a while, too.

That was last year. Yesterday, the Dow closed at 10,812.04, an increase of 65% over last March’s low. Following Republicans’ previous reasoning, is this evidence of President Obama’s brilliance? Not so much.

Stuart Varney, Fox News’ “very clearly partisan” economic analyst, said on Fox this morning that the stock market is doing well this month because investors are anticipating big Republican wins in November. Part of his explanation was that “a Republican sweep implies that most of us, if not all of us, will keep the tax rate we’ve got now. So that would end that uncertainty… The stock market anticipates what is likely to happen in the future, and the market is saying this is going to be a rally for the economy and the stock market because of a Republican sweep.”

As a factual matter, Varney’s description of tax policy isn’t even close to being accurate.

But in this case, I’m more interested in this notion that Republicans deserve credit for the recent increase in stock values. Varney pushed this line on Fox News yesterday, while Neil Cavuto and the Wall Street Journal‘s Steve Moore pushed the same line last week. As the argument goes, the GOP, simply by talking about extending tax breaks for millionaires, boosted Wall Street.

Even for the right, this is all terribly silly. Looking back over the last year and a half, the message seems to be that all Wall Street declines are the president’s fault, but credit for more dramatic Wall Street increases should go to Republicans.

To be clear, the value of a stock market index is hardly the best metric for measuring the strength of the economy. Indeed, it isn’t even close. But the point is Republicans can’t have it both ways — a weaker Dow can’t be evidence of Obama incompetence while a stronger Dow serves as evidence of GOP brilliance. Some shred of intellectual consistency should matter here.