unemployment

Stories and reports continue to break about the stimulus bill that was rushed through congress earlier this year and the fact that it has not succeeded in creating more jobs for Americans.

Still, there doesn't appear to be any leadership or a unified voice raising the tenor of outrage about this massive failure by the Democratic leaders in Congress and the Administration.  The more people scratch the surface of the stimulus reports, the more they discover a government boondoggle - with non-existent congressional districts, counting jobs that were created without stimulus funding, double-counting of jobs, and unclear entities that have been credited with creating new jobs. 

All the while, unemployment has reached an unbelievable 10.2%

This upcoming election cycle is about jobs and the economy - plain and simple. Every poll since September 2008 has shown that the number one concern of voters is jobs and the economy. 

Voters are watching family members, neighbors and friends cope with layoffs, and many have lost their own jobs.  People are surviving on smaller paychecks.  Many Americans know someone who has lost their home to a foreclosure and ever increasing numbers believe the stimulus is having no effect on the economy.  There is a sweeping sentiment among voters that the government is getting too large and is not responsive to the people.

Without mincing words, the trillion dollar stimulus the Washington Democrats shoved down America's throat is a debacle and is the clearest example of how they are fundamentally failing the American people in regards to jobs and the economy. 

In fact, David Obey, Chairman of the Appropriations Committee and father of the stimulus bill, is now placing blame on the Administration for lack of oversight of his own bill. Even he is running scared from the mess that is the stimulus bill.

This can not be emphasized enough.

Health care reform is important and must debated and a government-run plan should be fought aggressively. However, it appears that while we focus on that, the opposition is getting a free pass on this.  In reality, the healthcare legislation is a distraction to what is most important - the Democratic leadership's big government approach to jobs and the economy has failed...and this is the strongest reason why a big government approach to healthcare is wrong.

Republicans need to begin calling for accountability on this failed stimulus bill that is wrought with inconsistencies and bad numbers...and drumbeat the looming question, "Where are the jobs?"

I point you to a piece by Mike Flynn, editor of BigGovernment.com. Mike wrote a post today, Obama Stimulus Numbers: The Return of Enron-Style Accounting, comparing the reporting of the stimulus bill to Enron's reporting of it's financial reports. He's starting to see where this is heading.

We are in the grip of the greatest economic downturn since the Great Depression of the 1930’s…which by the way folks, was a largely Democratic creation. If that sounds familiar it’s because many of the same power grabs that contributed to it then are in motion now. Here on the left coast, in once sunny California, even some of our 20 million ILLEGAL aliens have given up to move back home to Mexico and go to work for the great growth industry down there…drug cartels. Meanwhile, in the second biggest Fantasyland in the nation, Sacramento, the Democratically dominated State Assembly, along with that ever acquiescent RINO Arnold Schwarzenegger, have taken the State with the tenth largest economy in the world and destroyed it as a viable economic entity. If you think I’m exaggerating, wrap your ponytail and Birkenstocks around this: Our Great Central San Joaquin Valley, virtually BY ITSELF, could feed the world…or could before the gutless California politicians allowed the environmentalists so much sway (for a price) that a Federal judge was able to take water away from California ranches and farms, for the sake of a lousy 2″ trash fish…the Delta Smelt. Supposedly because they were getting trapped in the pumping stations of the main irrigation canals, thereby depriving the salmon of this delectable hors d’oeuvre. Um…seems like salmon all over the world thrive without a single visit to our delta…fancy that. There are dozens of examples of this abject environmental stupidity all affecting California business and investment, even education and infrastructure. Although I’ve researched most I can’t go into them…we’d be here all week. One thing you can be sure of, wherever the ENVIRONAZIS are in this state, there will be a politician nearby waiting to have his palm crossed with silver…our silver. I imagine it’s much the same in the other States as well. This, and the invariably higher taxes, both personal and business that go hand-in-hand with increasingly repressive regulation, have resulted in the MASS exodus of business and jobs from this State, once one of the most prosperous stand-alone economies in the world. Now our ever-sleazy State Legislature, probably jealous of  Nancy (Bugeyes) Pelosi’s one-sided attempt to railroad the country into Marxist servitude and unable to con the voters of California into saying yes to a handful of doublespeak hidden tax bond measures, have resorted to complete and total NO FRILLS (meaning no voters, no election, no governor) TAXATION WITHOUT REPRESENTATION. Illegal and unconstitutional as hell…blatant spit-in-your-eye we’re-going-to-do-it-anyway taxation, in the form of a 10% additional withholding from pay checks. This in a state with 12.5 to 17% unemployment, depending on which set of depressing statistics you’d care to peruse. The aforementioned San Joaquin Valley has closer to 40% unemployed and invaluable farm land being destroyed by neglect and disuse. Supposedly, this additional ‘loan’ will be deducted from State income taxes at the end of the tax year…where are those Madoff investments? We’ll make a killing. I know I can speak for a whole lot of people in this State when I say there’s not a damn thing anyone in that Statehouse does to represent me! Even the Kool-Aid crowd has begun to figure out that gay sexual indoctrination of our helpless children is of a higher priority for these creeps than anything approaching responsible governance. We’ve put Congress and the White House on notice. The spin machine is working overtime, but the truth is the Democrats back there are scared peeless. NOW it’s time to take the Conservative Revolution to the California Statehouse!!

Semper Vigilans, Semper Fidelis

© Skip MacLure 2009

I considey myself sorta a "shot and a beer" Republican so when I see charts like this from Redstate

I feel compelled to try and provide a better visual idea of the futility to date of Obamanomics

Since February the Obama camp claims to have "saved or created" 100,000 to 150,000 jobs

On the other hand, unemployment is up by over 1.5 million. I suspect that when adds in "discouraged workers" no longer seeking work we are well above that number.

So I think there's about a 1 to 12 ratio of new or saved jobs to lost jobs right about now.

So here's the graphic

Jobs Obama saved

Jobs Obama didn't save. 

Any questions?

;

by Lance Thompson

The eager applicant, clutching his resume, strides confidently through the doors of the Enemies of America Human Resources Agency, and is immediately disheartened by the long lines of would-be terrorists, assassins, saboteurs and spies seeking jobs from the overworked bureaucrats of the jihad.

The employment counselor, Mulli al Rashiri, in his traditional Ghutra and short-sleeved thobe, motions the applicant to a chair.

“My name is Mohammed,” announces the applicant, handing over his resume.  “I want to join the fight against America.”

Mulli the counselor glances at the resume and shakes his head.  “I wish you’d come a year ago.  Everybody was hiring–al Qaeda, the Taliban, Iran death squads.  Could have got you a free trip to Venezuela just for an interview.  But now–nothing”

“But I am qualified in demolitions, firearms, subversion,” Mohammed pleads.  “I was voted Most Likely to Be Interviewed by MSNBC by my terrorist training class.”

“Just no need these days.”

“I can infiltrate the CIA, learn all their secret interrogation methods.”

“The Obama administration has already made those public.  And even if they hadn’t spilled all their secret interrogation techniques, the American Attorney General is prosecuting the lawyers who authorized them.  We have nothing to fear from the CIA.”

“I’m very good at propaganda.  I could devise campaigns to make the Americans look weak and untrustworthy to other nations.“

The counselor holds up his hand.  “Obama’s already done that.  He has abandoned the Eastern Europeans, belittled the British, kowtowed to the Russians, befriended Hugo Chavez, and answered the North Korean missile launch by promising not to weaponize space.  There is nothing you can do to weaken or embarrass the Americans that their president hasn’t already done.”

“How about sabotage?  I could penetrate their advanced aircraft factories and destroy their state-of-the-art fighter planes.”

“The Secretary of Defense already did that when he cancelled the F-22 program.  No need to destroy their front-line fighters–the Americans are scrapping the entire program.”

Desperate, Mohammed struggles to find a place in the fight.  “I could learn white collar crime.  I could work on Wall Street, destroy their financial system.”

“Obama has already taken care of that with his stimulus and spending bills.  America is spending trillions of dollars they don’t have, nationalizing banks and private industry, bringing in socialized medicine.  Obama is engineering the total collapse of the American financial system.  Do you really think you can do worse than that?”

“But I need a job.”

“So does every terrorist in the world.  Look, when Bush was in charge, and we were losing twenty, thirty, fifty holy warriors a day, we were desperate for new recruits.  But now I get thousands of applications for every job.  Even to be an entry-level community organizer for ACORN, you have to know somebody.  Ever since Obama and the Democrats took over, the job market in terrorism, insurrection, and anti-American subversion has plummeted.  Unemployment among terrorists has skyrocketed.”

“What should I do?”

“There’s always a need for suicide bombers.”  Mulli the counselor points to a long, stationary line of last-resort applicants.  “Good benefits, full retirement.”

Mohammed shakes his head.  “I was looking for something with more of a future.”

Mulli checks his computer.  “Al Franken is looking for a chief of staff.”

Mohammed pretends not to hear.  “I have a master’s degree from the Anti-American University in Tehran.  Maybe I could teach.”

Mulli shakes his head.  “It would take years of hard work and study to be able to indoctrinate American students to hate their country more successfully than the subversive teachers, textbooks and social programs already established in the American educational system.”

Mohammed’s hopes are crushed.  “All my life, I have studied how evil the United States is.  I hate America.  I want to tear America down.  There must be something I can do.”

“Have you thought about becoming a community organizer?”

There's been a lot of comparisons of President Obama to President Reagan,  President Kennedy and President Roosevelt; among non-divine historical figures. Based on this forecast from the noted right-wing rag, the New York Times, it appears unlikely that on one score Obama will reprise Reagan; he is unlikely to preside over a jobs boom in his re-election year.  

As the recession grinds on, more and more of the nation's means of production -- its workers, its factories, its retail outlets, its freight lines, its bank lending, even its new inventions -- are being mothballed.

This idled capacity, like baseball players after a winter off, takes time to bring back into robust use. So even if the recession miraculously ended tomorrow, economists estimate that at least three years would pass before full employment returned and output rose enough for the economy to operate at full throttle.

So when do things "return to normal"?

 The Obama administration, like the Roosevelt administration 75 years ago, is trying to break this logjam through government spending, using it in effect as a substitute for consumers who are jobless or short of credit. The spending is also a substitute for companies that hesitate to extend themselves or see no profit in doing so.

But the president's solution, the recently enacted stimulus package, spreads $787 billion over two years. So even if every dollar of spending restored a dollar of output, President Obama would be nearing the end of his first term before output approached the level achieved just before the start of the recession in December 2007.

I might add one concern I have is it seems likely to me much productive capacity will be permanently shut down. Some of this may be in "Neutron Jack" fashion; for example, when Obama idles the F-22 production line even if the plant in Georgia is left intact, the skilled labor is going to be in the wind and incapable of being replaced in short order.

A permanent --or at least "sticky"---reduction in the private sector's ability to supply goods coupled with monetary expansion unseen in American history. Stagflation, anyone?

I also find agreement from another voice of the right, 538.com's Nate Silver.  Here's a few excerpts from his post, Why We're Probably in For a Long Recession 

Silver reviews in his February 10 post economic declines and recoveries since 1945, and breaks out the "post-Greenspan" ones as having more "inertial momentum" than the more volatile economies previously. The Greenspan era has been noted for fewer recessions, but slower recoveries, according to Silver.

  Now suppose instead that we perform the same process based solely on data from the Greenspan Era -- from August 1987 onward. This gives us a rather different result:

I would argue that since February notwithstanding the "relief rally " off Dow 6500 and a few signs of housing liquidity that we are moving closer to the "red line"; which Silver anticipates would yield a peak unemployment rate of 9.6% in May 2010.

Silver also seems skeptical with the long tail of this model " it is not necessarily out to lunch in thinking that the equilibrium unemployment rate will be in the high 5's rather than numbers like 4.0 that we are used to." 

What is the effect of a 9.6% unemployment rate on the 2010 midterm elections?   Well we do have some useful background from the 1980's  The Republicans lost 26 house seats that year perhaps because unemployment reached 10.8% in November 1982.

So much for Joe Lieberman's "make nice" on behalf of Chris Dodd.

He predicted voters will realize Dodd is too valuable to lose, as the economy begins improving while Dodd keeps working on legislation to fix the financial system.

No "Joementum" in the job market that I'm seein

Back to Nate Silver. He asked this question "When will voters blame Obama?" Answer:

Obama crosses the 50 percent threshold at almost exactly 18 months from now, which would mean September 2010. At that point, a majority of voters say they will hold Obama accountable for the performance of economy

When unemployment is likely to exceed 9%. Not timely just eight weeks out from an election.

OK, so maybe the Democrats get bloodied in 2010. Won't the economy come roaring back like it did for Reagan?

Well, this was the pattern from 1982 to 1984      The unemployment rate fell quickly from its Autumm 1982 spike, ending 1983 at 8.3% and reaching 7.2% on election day.

Payroll increased by 3.5 million in 1983 and by another 3.5 million prior to election day 1984;  Source: http://www.bls.gov/ces/ 

Today we remember Reagan burying Mondale in the largest landslide in history, but his re-election was a near run thing; his approval was below 50% for most of 1983 and finally started into positive terrotory as the election neared.Polls in early summer 1984 showed both Mondale and Hart within single digits of Reagan.  ; had the economic recovery been slower or weaker American history might have been radically different.

So what will be the upshot if by election day 2012 national output is no higher than upon the start of the recession?. Well, barring an unprecedented drop in productivity total employment will be less than when he assumed office.  And, barring an unprecedented drop in the over 18 US population, the labor force will be larger. So it's probably reasonable to expect that the November 2012 unemployment rate will exceed the January 2009 rate of 7.6%   Sure Reagan got re-elected with unemployment in the 7's....but will Obama be able to point to massive job growth immediately prior to his election? 

And remember too, when Obama took office inflation and interest rates weren't a concern.  What would a return to $4/gallon gasoline do to his political fortunes?

At this stage, my money is Obama's gonna have to be a Roosevelt; since I seriously doubt he'll end up resembling Ronald Reagan. 

In taking in to account the recent statistics on unemployment dating back to the lowest rates of the Bush administration (4.4% in October 2006) and the data since that point, I have come to the conclusion that we will experience depression level unemployment (10% or more) in October 2009. A depression will likely be eminent and will become official (10% or more over two consecutive economic quarters) in March 2010.

By February 2010, one in eight Americans in the workforce will be unemployed and will be attempting to pursue employment, meeting the definition of “unemployment” according to the Bureau of Labor Statistics. By the end of 2010, the rate will reach 18.1%.

Based on data from the Bureau of Labor Statistics and projections using a polynomial trend-line, these calculations were determined with over 98% certainty that the current recession will become a depression once the summer is over with October 2009 unemployment hitting 10.7%. A depression will become official with an unemployment rate of 13% in March 2010.

By comparison, the unemployment rate from May 1979 to August 1983 increased from 5.6% to 9.5% (an increase of 69.6%). Over the ensuing 52 months (September 1983 to December 1987), unemployment dropped from 9.2% to 5.7%, a drop of 38%.

All of these calculations do not take in to account any economic impacts. The only details taken in to account are the monthly unemployment numbers from the Bureau of Labor Statistics.

So I happened to come across this graph from Speaker Pelosi's website.  It represents the aggregate job losses from the point at which employment started to decline ("the peak") for the past two recessions and for our current recession.  At first glance it looks pretty scary - job losses going off the cliff.  But a moment's thought reveals that this graph represents an invalid comparison, as our economy now is bigger than what it was in 1991, or even in 2001.  So comparing total job losses makes no sense - losing 500,000 jobs is much worse if it is lost from an economy with a total employment of 50 million, as opposed to 150 million.  Really what should be compared is the percentage of total employment from the peak.

So I dug through the BLS statistics and I came up with this graph.  Still looks pretty scary, even compared on a percentage basis.  But we all know already that this recession is worse than the previous two.  How about comparing it to the 1981-82 and 1974-76 recessions?  So when I did that, I got this graph.

Not quite so scary now, eh?  In terms of job loss, our current recession is about as severe as the 1974-76 recession, and not even as bad as the 1981-82 recession.  In fact if you look carefully at the data, by this point in the 1981-82 recession, jobs continued to be lost for 4 more months until things started to turn around.  And at least according to one source, "most professional economic forecasters are now predicting a moderate recession that will last until the middle of 2009" - which is, coincidentally, about 4 months from now.

Bottom line: Nancy's scary graph notwithstanding, we aren't on the verge of disaster.  Don't let the Democrats' fearmongering get to you.

I have a simple question, one to which I don't know the answer:

Will shovel-ready infrastructure projects do anything to fix today's unemployment?

The argument has been made times that unemployment can be reduced through public works projects, and it's become a centerpiece of the Obama stimulus package. Paul Krugman repeats the argument in this week's Rolling Stone. We remember back to the New Deal, when Roosevelt launched massive projects under the Works Progress Administration and the Civilian Conservation Corps, to name the most famous.

But the demographics of work are far different today than they were in 1933. 

Even before the Depression hit, most Americans were working class or poor, and few had college educations. The WPA specifically sought to help this population, targeting men without educational credentials from the rural South and West. (There was also a literary and arts component, which hired luminaries like Arthur Miller, but this was a smaller part of the program.)

Today the market looks far different. This economic crisis affects white-collar, professional and technical firms. Unlike in 1933, most Americans are now middle class, many with college degrees.

The people being laid off at the Boston Globe, Microsoft, or AMD may not want to work a shovel or a backhoe, at any wage.

If Obama's stimulus plan doesn't give jobs to the white-collar, educated people who need them, can the stimulus possibly work?

Let's leave aside for the moment whether or not the nation needs these projects (which I believe we do), or whether we support them (which I do as well). Will these infrastructure projects even work?

Does anyone have an answer to this question?