We are a commune of inquiring, skeptical, politically centrist, capitalist, anglophile, traditionalist New England Yankee humans, humanoids, and animals with many interests beyond and above politics. Each of us has had a high-school education (or GED), but all had ADD so didn't pay attention very well, especially the dogs. Each one of us does "try my best to be just like I am," and none of us enjoys working for others, including for Maggie, from whom we receive neither a nickel nor a dime. Freedom from nags, cranks, government, do-gooders, control-freaks and idiots is all that we ask for.
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Friday, February 3. 2012
By now, you've all heard the good news. It's been on the news everywhere, and the market jumped dramatically. This morning, the Bureau of Labor Statistics announced that job growth exceeded everyone's wildest expectations. 243,000 jobs were added, far more than the expectation of 140,000. More importantly, 257,000 private sector jobs were added, while 14,000 government jobs were lost. Unemployment dipped from 8.5% to 8.3%. All of this is very good news. Even those who oppose the president and his methods of handling the economy will not serve themselves to disparage this growth. I certainly won't. What I will say is that the general media is great at reporting headlines, but not digging into the numbers or providing historical context.
The media won't dig in, but others have in order to see what the numbers behind the numbers say, particularly since the CBO's report earlier this week was so lackluster.
The first bit of perspective comes from the Democrats, who spent most of the early 2000's disparaging the job growth of the Bush years as "McJobs". I notice none of them are speaking right now. Which is odd, because while we added about 90,000 very good paying jobs, over 113,000 of the jobs added were clearly "McJobs", or low wage labor. Any job growth is good, so I'm not saying this is a bad thing. I just want to know why "McJobs" were bad 9 years ago, but good now? If any Democrats would like to comment on this, they are more than welcome.
Another bit of news that went overlooked was the surge in part-time and temp work. Again, any job growth is good. I have nothing but good feeling for people who have been out of work but have managed to wrangle a paycheck. But if Obama's goal is "An Economy That Works", I'm sure he didn't mean "Works Temporarily and Part-Time"
A third, though somewhat justified question, is why the BLS has actually increased job growth estimates by a very large amount over the course of 2011. It's possible preliminary numbers were low, but by 23%? Revisions are always needed - by why so many positive adjustments? Usually it's "seasonal fluctuations". Which means...?
Finally, there is the very questionable 1.2mm members of the labor force who suddenly stopped participating. In the BLS' final paragraph, this is discussed:
Job growth is always a positive. This was a very good report and even ShadowStats shows a falling (though much higher) unemployment rate. But there are still large problems which the media is choosing to not address. One of these remains the labor participation rate, which is near a 40 year low. An economist worth his salt, especially the incorrigible Krugman, knows that it is possible for an economy to reach equilibrium at a level far below its potential capacity. The best we can say about this report is that while it's an improvement, it's far below our typical standards. If a "recovery" is deemed "strong" by the media, Obama faces a better chance of winning. Few here will question why mainstream journalists are not questioning the data. Clearly there is an agenda to be played out. Even Adam Carolla is aware of the existence of media bias.
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Expect to hear good news on the labor front out of the BLS from now until the November election. Never mind the facts. Expect to hear crickets chirping from the major news services and broadcast media from now until the November election. On this issue, as on every other one, expect Congressional Republicans to shoot themselves in the foot from now until the November election. And hopefully, expect to read the naked truth on this issue, as on every other issue, from James Taranto of the WSJ. For a guy who never went to college, Taranto might be the most sensible person the country could elect as President this year. Is there some way we might trade all of the current Republican candidates for just one James Taranto? It's for the children, you know.
I think the news is moderately good, even with the caveats noted.
Look at Congress, not the presidency, as the primary driver - about 60-70% of the political side. Then insert a 1-2 year delay for them to have their work take effect.
To repeat: weight the congress 2:1 over the president in effect on the economy. Don't measure for one year.
Now review the elections...2006...2008...2010... everything starts to come into focus. (Hell, you can go back 20 years and do the same thing) This is round four of a twelve-round fight.
Generally speaking, this is how I approach things with people who make claims about economic performance and presidents.
I try to point out that Congress is the main driver, and that there is a 1 1/2 to 2 year lag. Journalists typically avoid this approach, because pegging to a single person and a start date is easier, even if it is an inaccurate and misleading guide.
Even so, the current 'turnaround' (more like a turn, because there is likely another turn coming in a few months) will be laid at Obama's feet no matter what you or I think.
If this month gets repeated at the headline level several times over the next few months, people will ignore the caveats, as dire as they are.
People assume 6% unemployment with 59% labor participation is 'good', primarily because of how the BLS basically took 1.2 mm workers and marginalized them. But the reality is that 6% unemployment with 59% participation isn't too far from Depression levels.
Gimme a break. I walk down the street passing empty store fronts in an upscale neighborhood. My favorite, well-priced shops have closed and no one is signing on. Foreclosures? Mulitple. And the underwriters have plan on solving this problem? Watch billmoyers.com new program (liberal, tho' he may be) or Charlie Rose's interview with John Reed of Citicorp fame. We are ruled by a bunch of idiots. I would love to hear your feedback.
I'm not sure who or what you're asking for a comment on.
My point, and it seems the same point made in other comments, is that while there is some good news, there are a host of other news items blithely overlooked.
Despite the 'good' news on the labor front (and it is good, as far as it goes), I still know many people out of work, or people such as myself who have taken jobs below our level just to make sure we have a steady income and pay bills.
While I was unemployed I learned two very valuable lessons. The first is that a man over the age of 40 is not valuable, regardless of experience level. The second is if you're out of work, don't expect to be considered as a serious contender for any open position.
A third lesson, which isn't all that valuable but is worth mentioning, is that unemployed people tend to be risk-averse. I sought others like myself to pool minds and resources and see what kind of business could be started. It makes sense, the best time to start a business is when things are going poorly. But most others in a similar situation were not willing. They were still seeking a steady paycheck. As time went on, and my savings depleted, that was the first thing on my mind.
Things are not going well, overall, for the economy. The rare bits of good news get overplayed (like the labor numbers), while others are cast aside, ignored, or rationalized.
My own industry, media, is facing a very difficult year. The signs of a soft advertising market are evident already. Soft advertising usually means low spending expectations for the coming year. In other words, companies don't expect 2012 to be very good.
We saw the Christmas retail numbers pumped up after Black Friday. We were told it was going to break records. We heard the same in 2011. After the season was over, the news was blacked out. Try finding what limited news stories exist about actual Christmas sales. It was OK, not as great as we were promised.
This will be Obama's selling point. "I may not have turned things around, but think of where you'd be if I hadn't done what I did. Things are OK." It's unprovable, but it's not dishonest. Many of his more ardent supporters believe he saved us from a depression. People will forget he promised unemployment below 8%. People will forget the growth he promised. Independent voters will have a hard time arguing against his unprovable claims, and the media will be attacking Obama's opposition using tools such as those in yesterday's news. They won't appear to have a bias, they will appear to just reporting facts, but they will only report facts which support their goal to get Obama reelected.
I am wondering about the credibility of the BLS at this point.
How many dems with a desire to see 0bama succeed work there? Remember how the dems at State did everything they could to thwart Bush? Why couldn't BLS do the opposite and massage the numbers to make 0bama look good? After all, if you are a civil servant and can't be fired, what's the harm in doctoring the numbers to make your guy look good?
1.2 million is a heckuva lot of people to quit the work force in one month. Is it true or did BLS just pull that number out of the air?
All they have to do is pencil another 4 or 5 million out of the work force over the coming months and they will have unemployment down to 6% by November.
It's the largest single month alteration in number of people leaving the workforce ever. At least since the numbers have been kept.
Is it real? Who knows?
Is "seasonal adjustments" real? Who knows? I'm not sure why you have to seasonally adjust anything. People either work or they don't. Even if more people are doing retail at Christmas, or a warm spell puts more construction workers on the job during the winter - why do they have to adjust?
Actually I've heard the reasons for the adjustments. I just don't agree with them. Numbers are numbers. When you 'adjust' them, they become unreal.
As a boss of mine said once "I can't understand how you came up with these figures."
"Well, I ran the reports, and these are the results."
"But it doesn't agree with what I thought it should be."
"It is what it is."
"I'll take them and fix them, I know what to do."
Funny thing, by the time he was done, some of our worst salespeople became superstars. Magic!