Regular readers of my previous blog know that my favorite economists are Brian Wesbury and Robert Stein from First Trust Advisors, who describe their blog as “the antidote to conventional wisdom, dedicated to helping readers understand the complexity of modern economics from a supply-side, free market perspective.”

So Wesbury and Stein begin with one version of conventional wisdom, beginning with the unwisdom of Harold Camping’s inaccurate (yet again) prediction of the end of the world May 21:

Let’s imagine that the world really did end.  Let’s imagine that we’re now living in an artificial world.  Federal Reserve Chairman Ben Bernanke is making the sun rise with monetary policy.  Federal spending is generating oxygen and enormous increases in federal debt are making water.  Everything seems relatively normal, but it’s all ultimately just a mirage, created by artificial means, and it can’t last forever.

Of course this is an extreme example, but that’s what it seems many believe about the economy today.

It all goes back to 2008 when the economy crashed, supposedly all by itself, in what was called “the worst crisis since the Great Depression.”  The pundits said capitalism had failed.  Many predicted the complete collapse of the economy, a worthless dollar, and a “new normal” – it was the “end of the world” as we knew it.

And while the economy could be doing better, real GDP has expanded for seven straight quarters – we’re now in the eighth.  Corporate profits are at a record; the S&P 500 is up 100% from the bottom; consumer spending is $450 billion above its pre-panic 2008 peak, and private sector payrolls have expanded for 15 straight months.

So, which is it – fake, or real?  Did the economy crash and burn, only to be supported in an artificial state by government actions?  Or, was all that “end of the world” talk a prediction that did not come true?  Are all the same old real world things – like creative destruction, supply and demand, innovation, or trial and error – still happening like they always have? …

We do not believe that capitalism failed and that the world as we knew it is over.  The crisis was caused by a failure of government policy.  The bubble in housing was caused by low Fed rates and housing subsidies.  The Panic of 2008 was caused by a set of misguided reactions to the bursting of that bubble (mark-to-market accounting and TARP).

In our view, quantitative easing has had little impact – the money supply (M1 or M2) is not expanding as rapidly as many think.  Moreover, and this is key, the massive increase in government spending has been a drag on growth, not a boost.  In other words, the end of quantitative easing, spending cuts and a new focus on government debt reduction are things to rejoice about.

We are not in the majority, nor are we ignoring our economic problems.  We just believe the economy did not come to an end back in 2008 and we do not believe recent growth has been created artificially.

But a large, loud and sincere group is still convinced the economy is broken and fragile.  They see the recent slowdown in economic growth – real GDP growth looks to be growing at only a 1.5% annual rate in Q2 – as another sign that it really has been the end of the economic world.  Gloom and doom are back on the table.

Never mind that much of the slowdown is so obviously tied to temporary Japan-related disruptions in manufacturing and tornado-related dips in home building.  That doesn’t matter if you really believe the end is near.

But, when we move through these temporary problems, when auto production overcomes the parts-related slowdown and spikes back up at about a 100% annual rate in Q3, real GDP will sharply accelerate again.

Well, of course the economy didn’t come to an end in 2008. The economy is not “broken,” but it would seem to be at least “fragile.”

I’m not an economist (and I don’t play one on TV). Maybe my current view is skewed by my current employment situation. (Remember: A recession is when a neighbor loses his job; a depression is when you lose your job.) But there is little question that if Barack Obama were a Republican, you would read nothing but doom and gloom about the current state of the economy, far more than is being reported now.

The lesson of every recession dating back to the early 1980s and probably before that is that jobs are the last thing to recover after a recession. Friday’s job news was unspinnably bad news — just 54,000 jobs created and a 9.1 percent unemployment rate in May. Even the 90.9 percent of people with jobs are suffering from the effects of soaring gasoline prices thanks in large part to the Federal Reserve’s continued weak-dollar policy and the Obama Administration’s continuing failure to be serious about the federal budget deficit and debt. And in a state where tourism is one of the three top industries, high (and rising) gas prices should be a major concern.

Does this (from Reuters) read like a recovery to you?

For smaller businesses that depend on the financial well-being of their customers in order to make a profit, the damage to household balance sheets has been difficult to shrug off.

“We’ve been in business for 37 years and survived five recessions,” said Frank Goodnight, president of Diversified Graphics, a commercial printer and publisher in Salisbury, North Carolina.

“This recession will be equal to all five put together plus about double. And we don’t think it’s really going to turn around in another year.” …

“The problem with a ‘soft patch’ in the economy is that you don’t get two of them in the first two years of a normal recovery,” said David Rosenberg, chief economist at Gluskin Sheff.

(The aforementioned “smaller businesses that depend on the financial well-being of their customers in order to make a profit” are, by the way, every business.)

Remember that this is one year after the “summer of recovery.” Remember that President Obama commanded businesses to hire employees. But businesses aren’t hiring employees to fill nonexistent and unanticipated orders; that’s the only conclusion you can make from the job numbers. And unemployed people do not buy such big-ticket items as houses, cars and large home appliances. Nor do people who are employed but feel uncertain about their economic prospects. Spending one-fourth of the gross domestic product and generating deficit and debt numbers that no one reading this blog will live to see paid off hasn’t worked for this country, has it?

The American Enterprise Institute’s Michael Barone makes an interesting observation:

Obamacare and the Dodd-Frank financial-regulation bill are scheduled to be followed by thousands of regulations that will impose impossible-to-estimate costs on the economy.

That seems to have led to a hiring freeze. The Obama Democrats can reasonably claim not to be responsible for the huge number of layoffs that occurred in the months following the financial crisis of fall 2008. And Treasury Secretary Timothy Geithner and Federal Reserve Chairman Ben Bernanke did manage to help stabilize financial markets.

But while the number of layoffs is now vastly less than in the first half of 2009, the number of new hires has not increased appreciably. Many more people have been unemployed for longer periods than in previous recessions, and many more have stopped looking for work altogether.

It’s hard to avoid the conclusion that the threat of tax increases and increased regulatory burdens have produced something in the nature of a hiring strike. …

Obama had already ignored his own deficit-reduction commission in preparing his annual budget, which was later rejected 97–0 in the Senate. Now he was signaling that the time for governing was over and that he was entering campaign mode 19 months before the November 2012 election.

People took notice, especially those people who decide whether to hire or not. Goldman Sachs’s Current Activity Indicator stood at 4.2 percent in March. In April — in the middle of which came Obama’s GW speech — it was 1.6 percent. For May, it is 1.0 percent.

“That is a major drop in no time at all,” wrote Business Insider’s Joe Weisenthal.

After April 13, Obama Democrats went into campaign mode. They staged a poll-driven Senate vote to increase taxes on oil companies.

They launched a Medi-scare campaign against Ryan’s budget resolution that all but four House Republicans had voted for. That seemed to pay off with a special election victory in the New York 26th congressional district.

The message to job creators was clear. Hire at your own risk. Higher taxes, more burdensome regulation and crony capitalism may be here for some time to come.

Hoping for bad economic news because you don’t like who’s in charge in Washington is against your own interests. But if things are getting better, that has escaped notice of working people and business people. And if business isn’t doing well, its employees aren’t doing well.