Lackluster Jobs Report

Because of the administration perpetual damage control these days- attempting to manage the repercussions of the President’s ongoing and mounting missteps, the economy seems all but forgotten.

Domestically, these blunders include- but aren’t limited to- the continuing and unanswered questions surrounding the IRS’ political intimidation scandal. There’s also the man-made distraction that is Attorney General Eric Holder who encouraged his state-based counterparts to disregard their oaths to their respective state constitutions and not defend laws they personally disagree with.  He also tried to persuade states to lift bans that would allow convicted felons voting privileges.

And there’s yet another Obamacare implementation modification and two-year delay to the imposition of the individual mandate.

On the world stage these blunders include the repercussions of Syrian’s civil war and humanitarian disaster that occurred while Obama weakly endeavored to erase the red line he set in regards to Bashir Assad’s murdering of his own people.  Then there’s Iran’s disruption of Middle East politics and mocking of the president’s threat of military force to contain Iran.  And who can ignore Putin’s methodical attempt to expand the Russian empire into Ukraine.

Again, because of the President’s contribution to these distractions, the economy is the forgotten man.  The economy receives scant mention by the media and not taken seriously by the President or his economic advisors.

The national unemployment rate had a slight increase to 6.7%, (U-6 is 12.6%) representing 10.5 million Americans still looking for work.  The long term unemployed increased by 203k in February, bringing the total number of Americans unemployed 27-weeks or longer to 3.8 million.

The Obama administration will continue to spin this report as (more) evidence of and economy slowly gaining momentum even though the nation’s GDP was revised downward to a 2.4% annual growth pace in the fourth quarter, not the 3.2% that was initially reported.

Five years after the president’s celebrated $900 billion “stimulus package,” there are still more people out of the workforce today than when he took office in January 2009.  There are more people receiving food stamps and federal disability than when he took office as well.  The annual average labor force participation rate reached a 35-yr-low, averaging 63.2% for 2013. All of this is indicative of the fact that this “recovery”- if one still wants to call it that- is the weakest since the Second World War.

The CBO’s recently released report describes the reality in detail.  It notes that the sluggish recovery, the inverse relation of the unemployment rate drop to the high numbers of disaffected, potential employees who’ve left the labor force (including the high numbers of the long-term unemployed) and the low demand for goods and services that’s partially responsible for the slow growth of payrolls is expected to negatively affect the nation’s economy for at least a decade.

Month after month, the economic indicators have become increasingly ominous, yet very little has been done, let alone addressed. The country is in a vulnerable position and in need of leadership- particularly on this issue.  But it won’t be found in the person reclined in the Oval Office who disrespectfully puts his feet up on the Resolute Desk.

Consider the president’s recently released, $4 trillion dollar partisan budget that Democrats will use as a campaign platform for the midterm elections.  The president wants more tax increases with projected revenue of more than a trillion dollars; he wants to decrease the size and pay for members of our military (even though food stamp use among our soldiers has increased under Obama).

Obama also wants to create and fund more social programs like “universal preschool” and he wants to extend unemployment insurance.  There are even budget sub-topics such as ending homelessness, increasing minimum wage and immigration reform.

If that wasn’t unserious enough, the president’s budget also calls for a $1 billion-dollar, “resilience fund,” that would combat the negative effects of climate change.  This would give the EPA the money and power to impose the president’s regulation-heavy agenda on the country, causing energy costs to increase, cheating the economy of over $2 trillion over the next twenty-plus years.

Obama’s budget is in no way a sober attempt to deal with the economic difficulties facing the country, many he directly contributed to.  In other words, zero substance, which is perfectly reflective of its author.

The state of the nation’s economy matters very little to the president.  Obama hasn’t been held accountable for the country’s poor economic situation thus far and I suspect very little will change that fact in the near future.

Advertisements

The Economy Worsens

For those that suffered through the President’s SOTU speech last month, few may have been deceived into believing the pretty picture painted by the President regarding the state of our economy.  The attentive were not.  That the economy is doing anything positive and worth commending in this anemic, so-called recovery has more to do with the strength and resiliency of the American people- despite the President’s stewardship, not because of it.

 

The President’s administration appears to welcome the expanding welfare state. Today’s jobless report once again showed that the continued drop in the unemployment rate- both national (6.6%; U-6 rate, 12.7%) and in respective demographics (blacks-12.1%, black teens-38%, Hispanics- 8.4%)- isn’t the result of the economy making the progress desperately needed, but rather the result of more Americans giving up hope and leaving the workforce.  However dishonestly the administration attempts to spin the news as good coming from the Labor Department, the stats don’t lie.

 

Consider the following-

            – Real median household income continues to fall;

            – The civilian labor force who have Bachelor’s degrees, older than 35 continues its historic fall;

            – The labor force participation rate of men between the ages of 25 and 54- men in their prime- continues to drop.  It’s estimated that close to 10.5 million men, aged 25 to 54 don’t have work.  This should be kept in mind the next time one hears about a so-called war on women;

            – Hours worked continues to decrease;

            – Fifty million Americans now live below the poverty level a number exacerbated during Obama’s presidency.  This is why many feel that the current strategy used in the “war on poverty” has failed;

            – According to the Corporation for Enterprise Development, half of Americans are living in what they call “persistent economic insecurity… making it difficult to look beyond immediate needs and plan for a more secure future.”  In other words, half of Americans are unfortunately living paycheck to paycheck.

All of this presents serious causes of concern for the economy now, and its effects on the future. Sadly, the news concerning the economy continues to grow more worrisome.

The Congressional Budget Office (CBO) released a report Wednesday stating unemployment remains historically high as a result of the slowest recovery following a recession since 1975.  Further, the report affirmed that despite the projections of decreasing unemployment rates in the future, the labor force participation rate would continue to drop (13-14).

The report also stipulates that as a result of the Obamacare’s subsidized provisions- provisions that decline with increased income- people will inevitably determine that there exists a considerable financial incentive (subsidies in combination with the current marginal tax rates) to work less, if at all (pg.14).  This negatively affects the labor force participation rate.  CBO analysts estimate that those responding to the incentive not to work could reflect upwards of 2.5 million jobs over the next ten years.  The report goes on to state that though total employment will increase, it will do so at a slower rate resulting from the Obamacare’s adverse affects  (p.117).

This job-loss projection doesn’t include the full impact of the employer mandate, which doesn’t go into effect until 2015.  Millions more jobs will be forfeited when employers calculate that penalties, layoffs, and reducing employee hours are preferable than increasing their labor costs and or going out of business. As the CBO report states, “[T]he costs of the penalty eventually will be borne primarily by workers in the form of reductions in wages or other compensation […] Because the supply of labor is responsive to changes in compensation, the employer penalty will ultimately induce some workers to supply less labor.”

In other words, Obamacare is the job-killer many knew it to be and over the next couple of years that truth will be laid bare for the country to see.

The response from Democrat lawmakers, and the President’s administration is expectedly, cartoonish spin and serves as more proof that they aren’t taking the economic situation seriously.

According to Rep. Chris Van Hollen (D., Md.), it’s a blessing as he says more Americans will have the freedom to “choose to work less or not at all” because the government has provided them with health insurance. 

Senate Majority Leader Harry Reid (D-NV) said that the report “rightfully says that people shouldn’t have job lock.  We live in a country where we should be free agents. People can do what they want.”

Whiskey, Tango, Foxtrot.

Chairman of the Council of Economic Advisors Jason Furman said, “This is not businesses cutting back on jobs.  This is people having new choices.”  Furman went on to say that this new freedom would create a dynamic marketplace that magically encourages entrepreneurship.

Jay Carney simply disagreed with the report because he didn’t like what it had to say. 

Job lock?” “Free agents?” “New choices?”  This is Alice in Wonderland.

The situation is so bad that the President finally acknowledged his unpopularity to Senate Democrats.   The President should try telling people something they don’t already know.

Unpardonably, the President and his party are idiotically embracing the job losses anticipated by the CBO report.  In a sane world, politicians, upon hearing such bad news, would pass legislation, reduce taxes and regulations, etc. to try and counter such bad economic news.

Not on Planet Progressive.

On Planet Progressive, projected and actualized job losses are celebrated and touted, asserting that the impending unemployment millions of Americans will face is a good thing because these Americans will be able to “choose” to work less hours and “choose” to be unemployed because they’re able to receive health insurance.  On Planet Progressive, unemployment is a good thing because the unemployed have health insurance even though they lack a consistent paycheck.  In what sensible way does this fantasy balance itself out?

I applaud and commend the determination of Americans who stubbornly attempt to persevere despite the odds.

But neither applause or “free” health insurance is enough for the American worker to pay his/her bills or overcome expanding government headed by a chief executive so stuck on stupid that our nation’s economy careens out of control.