Spinning the Jobs Report

George Rebane

For the last year plus we’ve heard from Team Obama about how his policies have improved the economy by “creating” 4+ million new jobs since 2009.  It is on the other side of astounding how his supporters lap this up as being some kind of improvement rather than the actual disaster that it is.

We have over 4 million people annually entering their working years.  For the economy to keep pace with this influx, it needs to create 200-250K jobs each and every month.  And that requires robust GDP growth in the 3% per year rate.  This is not possible with ever higher taxes and more regulations arriving at an unknown time in the future.  And most certainly not possible with the US business taxes and labor costs being the highest in the world.  Not one of Obama’s lemmings asks ‘why should a business take on new risks in the US when way more friendly environments and markets beckon overseas?’

Right now the economy is somewhere around 24 million jobs short of where it should be had the recession not started in 2008.  This growing number must be made up, otherwise America will fundamentally transform into a state with a systemic unemployment rate that is just under 20%.

FDR screwed up by deepening and extending Depression1 with his massive Keynesian intervention.  Having learned nothing in the interval, Obama is reapplying Keynes – the federal government is pulling out 25% of GDP for its wealth transfer programs – with equally devastating results.  By that I mean that the real unemployment iceberg is mostly not visible since people have opted out, gone on more government distribution programs, entered the gray or black markets, and generally doing everything they can do to survive by gaming our increasingly centrally planned and very gameable system.  And as I mentioned, businesses are doing their part to escape the pain.

All that leads to everyone seeking alternatives to the historical norm of making things work for them and their families – hearken back to the USSR and how its economy did not work.  This is not the way to run a country that is supposed to be on the road to recovery instead of edging closer to a full-blown Depression2.  Which brings us back to the question of what Obama and his cadre of elites are really trying to do with America.  Even wholesale stupidity – always a good short answer - doesn’t explain everything that the feds and state governments like California’s are doing.

Comments

[THEMIKEYMCD]

Any positive summary of the employment picture in America a lie. Period.

This clip should provide food for thought.

http://www.zerohedge.com/news/stockman-ron-paul-right-fed-and-lunatics-run-it-are-heart-problem

[THEMIKEYMCD]

http://pjmedia.com/instapundit/wp-content/uploads/2012/08/OBAMAUNEMPLOYMENTFAILCHART.jpg

[billy T]

Finally a bit of good news. Ford Motor Co is planning on adding 1,200 workers at its "Ford Only" Flat Rock plant to produce the Fusion. Previously the Fusion rolled off a plant in Mexico. Plant owned 50/50 with Mazda.

http://www.mlive.com/auto/index.ssf/2012/09/ford_renames_flat_rock_plant_f.html

As far as Dr. Rebane's Jobs Report goes, nothing to disagree with or nit pic. Love the way the Dems tout "29 straight months" by choosing the starting point and omitting the last two months. Take July 2011 and compare to July 2012. Take August 2011 and compare to August 2012. We have heading in the wrong direction. Stupid is as stupid does.

[billy T]

Opps, spoke too soon about good news. Eastman Kodak announced plans to lay of another 1,000 employees. Not to be outdone, HP announced it is going to lay off another 2,000 people to add to the already 27,000 employees that it plans to cut. Mr. Clinton, do the arithmetic. News Flash: We are broke. I shudder to think what will happen when the non tax payers overtake the tax payers. I bet we will still be broke. I have a funny feeling we are going to find out pretty soon. People and children with no money in the candy store do not like to be told "no". I like NO. It is a complete sentence.

[Paul Emery]

Now that Obama is cruising to what appears to be an easy victory it will be interesting to look ahead as to the future alignments within the republican party. With the great schism coming between the fiscal and social conservatives, two sides that don't share the same interests you may see a migration to Libertarian camps by disgruntled TP's. For example what does a woman's right to chose have to do with fiscal responsibility? The self appointed moral guardians that have a grip on the party may have it all to themselves.

[Ryan Mount]

I'm not so sure it's gonna be a cruise to victory for Obama. (Yes, I've seen the latest polls) 2 months is a long time notwithstanding attacks ads. A lot can happen around these parts in a very short period of time. And the electorate is very fickle and prone to be steered away by the slightest crisis that the other side can capitalize on.

But you're right Paul, the moral conservative message simply does not play well anymore in the USA. With the exception of a few notably loudmouths, the GOP has been pretty quiet on the campaign trail with regards to things like abortion. (not that they're not fooling anyone).

[Gregory]

Paul, your whistling past the graveyard is commendable, but you may need professional help if the election doesn't turn out as you hope.

For the idiomatically challenged, that's
http://en.wiktionary.org/wiki/whistle_past_the_graveyard

[Paul Emery]

Ryan

The reason it's pretty easy for Obama at this point is that he has more guaranteed electoral votes meaning Romney needs a landslide in battleground states to win. He's not looking good right now though most states are close but leaning towards Obama. The Senate is also looking like a tossup when once it looked good for the Pubbers. I enjoy the perspective of Nate Silver in looking at polls. Check him out.

http://fivethirtyeight.blogs.nytimes.com/2012/09/10/sept-9-call-it-as-you-see-it/

[Ryan Mount]

Paul-

These forecasts assume everything is going to stay the same. All it takes is ONE Willie Horton ad or one Daisy Commercial. What if gas skyrockets? What if war breaks out in Israel? What if we discover a gimp suit under Obama's bed. (Try "unforgetting" that mind picture! Come to think of it, that might actually boost Obama's youth vote.)

It's still too early to make such prognostications. It seems more like wishful thinking on some (not you). Reagan and Carter? Bush II? But I'll give the Obama-ites one thing, it's theirs to loose. Romney ain't no Reagan, but Obama sure knows how to channel the Gipper's campaign wizardry.

[Ryan Mount]

lose*. Sorry.

[Gregory]

Romney doesn't need a 'landslide'. None of the battleground states have Obama up by much at all if any, and all that needs to happen is for the 'undecideds' to break substantially for the Republican ticket for Obama to lose.
http://www.rasmussenreports.com/public_content/archive/2012_electoral_college_scoreboard

The Romney campaign ad carpetbombing has only just started in the battleground states. I've not clicked through to see them but Dick Morris is singing their praises:
http://www.dickmorris.com/romneys-great-new-ads/#more-9701

[Gregory]

George, FDR didn't give us the great depression by government spending, by Friedman it was caused largely by a destruction of the money supply by the Fed.

David Stockman was on CNBC singing the praises of Ron Paul as the only one who has been right on the current Fed... as long as deficits can be financed by zero interest bonds, we'll have massive deficits.

[George Rebane]

Gregory 313pm - Yes, Depression1 was set off by bad monetary policy, but it was extended more of the same and FDR's alphabet soup agencies, continued bad monetary policy, and thrown in for good measure bad fiscal policy (taxes, fees, ...).

Re Stockman etc. I have pointed out for some time now that it boggles the mind that we have no debt service to either federal budget or GDP index (I modestly named it the Rebane Debt Index when introducing the notion on RR). If interest rates are essentially zero, and you continue rolling over old debt while borrowing more, who cares how much you owe. But no one talks about save a few lonely voices like Ron Paul (and Dick Cheney for a while).

Most recently, this point was made clear in the post with the influence factors diagram - that unfortunately drew a yawn.
http://rebaneruminations.typepad.com/rebanes_ruminations/2012/08/national-issues-connecting-the-factors-that-affect-us.html?cid=6a00e54f86f2ad8833017617550ed6970c

[billy T]

Obama is up. Still a horse race down the backstretch, just coming into turn two. Romney still in the game. Two months is a decade in politics. They say everybody has made up their minds. Think Reagen trailed Carter thru August. Way too early to call. Obama was hoping to quash Romney like a bug early with his attack ads and have this whole thing wrapped up by July. He tried, man he tried.

I though Harry Reed was toast in Nevada's last Senate race. Two weeks to go. I was wrong.

Looking good for Obama today. Looking good for Romney that the incumbent can't break 50%. Looking good for Obama in the electoral college. Looking better for Romney now that Nevada and Florida and a few others have moved into toss up.

Win or lose, I would not write the obits for them pesky Repubs quite yet. Less than 4 short years ago the pundits were doing the same thing. Coming off a election of change and unity, with exciting energy in the air, the always unbiased liberal media gleefully declared the Republican Party was toast for the next few decades. To be a insignificant regional party of hillbillies, not to taken seriously. To be relegated to the dust bin of history. Hmmm. I think Romney should just pack his bags and go home. Its over. He is toast....but I have been wrong before. 2 months is a long time in politics.

What amazes me is Romeny is still standing. I have seen this in sports. Let the opponent hang around too long and suddenly the game is over and the opponent has the higher score. How did that happen? The winner may squeak by but takes 100% of the victory.

[THEMIKEYMCD]

I wholeheartedly agreed with Stockman's views on The Fed.

Rising interest rates/debt service will likely be the crisis that allows for real government reform... though the mob will beg for totalitarianism instead.

http://www.zerohedge.com/news/stockman-ron-paul-right-fed-and-lunatics-run-it-are-heart-problem

[Paul Emery]

Billy T

You just proved my point about Harry. Sharon Angle was piece of work way to radical a winger for general consumption. She opposed abortion even for a young girl raped by her father. Her famous "Second Amendment remedies" in relation to dealing with a government she opposes was pretty scary. "They're afraid they'll have to fight for their liberty in more Second Amendment kinds of ways?"

That's why she lost despite Harry's remarkable lack of appeal. She was a gift to the Dems much like Ryan. What happened to Ryan by the way? He seems to have disappeared much like John Edwards in 04. Speculation is that they overshadow the boring candidates they are supposed to back up. Shows a lot about Romneys appeal.

[billy T]

Glad to assist ya there Mr. Paul. Thought it was Sharon Angle's ad about criminals and tough on crime that showed a pic of a gang banger Mexican look alike that doomed her. That really fired up Harry's base, but I could be wrong.
Where's Ryan? No idea. Probably taking a couple of days off for R&R. Congress is back for a whopping 8 days or so. Hey, speaking of MIAs, did you catch Gore's speech at the Convention? Neither did I. Shame what fame and money does to a person. He had so much potential.

[Paul Emery]

At least he was allowed in the building (gore). The Bush family was represented by Jeb who pleaded for mercy for what's his name. Don't pick on my brother was his message.

[TomKenworth]

Gas will not skyrocket, excepting for an 8.2 centered in Richmond, California. People out of work don't commute or take vacation trips.

[billy T]

Exactly TomK. People out of work don't drive or take vacations or pollute the environment. People working part time can barely afford to get to work and buy peanut butter, not to mention quarters for the laundry mat. Sad times, no doubt.

Gas will not skyrocket? Depends on one's definition of skyrocket. Have you seen the national average? All time high. One would think that California would drop its state gas tax at the pump to help the po folk. Po folk are more likely to smoke cigarettes, so lets raise the tobacco tax on the po folk. Shame on the government gougers. Outta be a law against sticking it to the weak, the feeble, the slow, the unemployed.

I did not take a vacation this year either. Buying a home on a short sale. Taking forever, but it helps the desperate seller out. Not being greedy. Offering 1/3 what they paid for it. Making sure the county gets its property tax revenue and doing my part. Its the least I can do.

[THEMIKEYMCD]

Gasoline was $1.83/gallon when Obama took office.

Gasoline prices are inversely correlated to the value (or lack thereof) of the US Dollar.

The value (or lack thereof) of the US Dollar doesn't care about vacations.

If you are unemployed the price of gas has already 'skyrocketed.' What else would you call a 100%+ increase in less than 4 years?

[George Rebane]

re MikeyMcD 824am - Last week in soCal gas was $4.80/gal in many places near major highways and population centers. When I predicted gas 'skyrocketing' to $5 a couple of years ago a leading local liberal light took me to task as a knuckle dragging redneck, assuring me that it would never happen. And as we see above, the minds of the liberal minions are still in full denial. I will have to revise my predictions.

[THEMIKEYMCD]

Q: How on earth can we get lower gas prices? Economic growth? Jobs?

A: Strengthen the value of the US Dollar.

Q: How do you strengthen the US Dollar?

A: Rational fiscal and monetary policy [natural interest rates, cut gov spending, free markets (anti-corporatism)].

[George Rebane]

MikeyMcD 903am (contd) - Drill baby, drill, and distribute (pipelines), and produce (refineries, etc).

[THEMIKEYMCD]

Yes, more domestic supply would accomplish the same (stronger US Dollar, lower gas prices, economic growth, jobs)... and I can't think of a better way to peacefully 'attack' our middle-east enemies than disrupting oil supply.

Fact: Right now only 2.2% of federal property is leased for drilling...

[billy T]

Exactamundo, THE MICKEYMCD. We are in a global slowdown and gas prices are up. Oil is tied to the value of the Yankee Dollar. No way around that one, unless we switch to Chinese coins. Happen to have a shoe box of Chinese coins, but Safeway won't take them. A booming world wide demand for oil would skyrocket the prices, unless we increase domestic demand coupled with sane fiscal policy and debt reduction. Not in the current Administration's cards. Read them and weep.

Finally read the last Obama budget that not one member of Congress agreed to get on board with. Calls for additional 3.5-4 trillion in spending over ten years on top of the current cruise control budget we have now. Tax the rich, grow baby grow the government, screw the deficit. Been there, done that. Take as much as possible out of the private sector to make government bigger.

Years ago I read the US Civil Defense plan in case of nuclear attack. Plan was simple. Stockpile morphine and pass it out to the masses. Ease the pain.

Today's plan is to pass out sugar plums from Uncle Sam's candy kitchen. Ease the sufferings of the masses. More addicting than morphine.

All is not lost. I remind the kids that 3 out of 4 people held jobs in the Great Depression. Not bad, and there was no unemployment insurance. How come they did not all wither up and die from lack of nourishment? Another great mystery. We have it easy today.

Joe Biden said the whole enchilada is simple: "Its a three letter word--J-O-B-S". The current administration puts a new meaning to a four letter word.

[billy T]

Correction: first paragraph should read "increase domestic supply" (of oil). Increase demand ain't bad either for a growing economy, but increase supply would really help. I don't think Obama's all of the above ground energy is going to reduce the oil supply for a few years. Unemployment insurance only last 99 weeks for the 99%ers.

[Gregory]

bT, oil is an internationally traded commodity so having a larger domestic supply doesn't mean we'd be the ones to burn it all... but it would mean our demand wouldn't be a drag on the value of the dollar.

With all the now-extractable fossil fuels within our borders and continental shelf, the US specifically and North America in general is poised to be the OPEC of the 21st and 22nd centuries and politically, all that needs to happen for that to become a reality is for the global warming scare to run its course. It will take years for the big projects to actually bear fruit but it won't take long at all for oil speculators to decide selling is more profitable than holding.

[TomKenworth]

Gasoline was over $4/gallon in June of 2008, and then took a strange nosedive all the way to the election, and two months beyond, and then, as soon as Obama took office it took off back up to $4. Sure looks funny if you look at the gas prices from 1999 to 2012. Of course if you start in Jan 2009 and run forward, looks like you can blame it all on Obama, as if he had something to do with it.

[George Rebane]

TomK 1229pm - Yeah, it does look like Obama has made a contribution to the rise of gasoline prices. His history of 'support' for below ground energy and its production, transport, and distribution speaks volumes, especially when you include his taking credit for all the oil production programs that Bush2 started. As Gregory points out, oil and gas are fungible commodities. The more we produce, the more we add to the world's supply whether it's consumed here or there.

[Gregory]

As is so often the case, the truth is somewhat different than what Keachie/Kenworth is intimating. Oil is an internationally traded commodity, and OPEC wasn't in a conspiracy to drive down prices to hurt Obama in 2008 or to hurt him by driving up prices now.

http://www.nyse.tv/crude-oil-price-history.htm

Had the Keystone pipeline been approved and the Feds as approving of US oil production as it is of Brazil's, we'd now have lower oil prices and more jobs. It really is as simple as that. California would be less dependent on a handful of refineries for all its gasoline were our required blend be the same as for our neighboring states; the California-only gasoline mandated by the EPA means refineries elsewhere can't easily produce gas for our cars when one of the California refineries goes off-line for any reason.

[billy T]

Obama said his economic plan is working. He also said the private sector is doing fine. Let's all hope so for the sake of our nation, our country, our homeland. Here is a little report included in this link. Its only 545 pages long. Difference between Romney/Ryan and Obama/Biden is the challengers get excited and roll up their sleeves and dive into every word studying every eye glazing page. Guess one prediction is coming true. Someday the nerds will be the jocks. http://www.foxnews.com/politics/2012/09/11/us-slips-from-no-1-to-also-ran-in-global-economic-rankings/

[Russ Steele]

IBD:

How bad is America's jobs market? Layoffs and firings are at the lowest levels on record — yet the country still isn't adding enough jobs to keep up with population growth.

During the Great Recession, employers slashed millions of jobs. During the economic recovery, net job growth has been tepid. But the problem is no longer layoffs. They've been trending lower for years. In July, layoffs and other forced separations fell to 1.554 million, according to the Job Openings and Labor Turnover Survey (JOLTS). That's down from 1.761 million in June and 1.956 million in May and the lowest on records hailing back to December 2000.

With so few layoffs, even modest hiring activity would yield robust net job growth. But total hiring dipped slightly to 4.229 million in July, while job openings fell modestly to 3.664 million. Both are near their lowest levels of the year. Hiring actually is slightly below the 4.244 million of March 2010, when the private sector was just starting to show net job growth again.

Nonfarm payrolls rose by just 96,000 in August, the fourth time in five months that net hiring has been below 100,000.

The U.S. needs to add 125,000 jobs or so just to keep pace with population growth. The only reason the jobless rate isn't far into double-digits right now is because the labor force participation rate has tumbled to a 31-year low.

[George Rebane]

RussS 804am - Given simple arithmetic applied to population growth and exits from our educational system, 125,000 jobs a month will not cut it. The number of jobs needed is in the 200K - 250K range as I report in this post.