January 12, 2010
Obama's Jobs HoleBy Christopher Chantrill
The Bureau of Labor Statistics released the December employment report on January 8, and the mainstream media reported that 85,000 jobs were lost. The big story, as usual, was in the Household Survey. There was no mild leakage of 85,000 jobs there, but a whopping 589,000 jobs flushed down the drain. Here are the numbers from the Bureau:
| Total | Change
Civilian labor force ....| 153,059,000| -661,000
Employment .............| 137,792,000| -589,000
Unemployment .........| 15,267,000| -73,000
Not in labor force .....| 83,865,000| 843,000
These are the numbers used to calculate the unemployment rate. Note the reason why the rate didn't skyrocket. A total of 661,000 people dropped out of the labor force in one month. Don't think that things are going to get better any time soon.
But let's look beyond the numbers to the trends, also available from the Bureau of Labor Statistics. This is where things really get scary.
Employment in the U.S. is now down from the peak of 146.5 million reached back in November 2007. That's a loss of 8.5 million jobs in two years.
Thank goodness the mainstream media has not made invidious comparisons to the Bush recession of 2001-02. Back then, only 2 million jobs were lost, a mere scratch compared to the gaping wound in jobless Obama America. You can see why knowledgeable people speak of 2009 as the year the locusts ate. What was President Obama doing flogging health care reform for a whole year when his policy should have been -- from noon on January 21, 2009 -- jobs, jobs, jobs?
Perhaps the president thought that the $787-billion stimulus bill would take care of the economy.
We don't know what President Obama and his advisers were thinking a year ago when they decided to go for broke on the liberal legislative agenda instead of healing the economy like the American people wanted.
But they didn't, and now we know that it was a strategic mistake that has put the Obama administration and the Democratic Party deep in the hole.
Even worse, things are going to get worse before they get better. That's because Democrats still believe in the myth of Keynesian economics -- that you get out of a recession by printing money and increasing government spending. You'll remember how well that worked when the Democrats tried it again and again in the 1930s.
Probably President Obama has never really thought much about economic affairs. His rhetoric mostly soars at the prospect of enlarging the administrative state, most obviously by taking over the health care industry to heal the sick or capping and taxing energy to lower the oceans. In his unscripted remarks before Ohio plumbers, it did not seem to occur to him that the private-sector cattle must be fattened before we -- that is, he -- can "share the wealth."
We will see in 2010, as Obama's increasingly desperate attempts to jump-start the economy intersect with the impatience of the voters, just how badly the president has failed the American people by favoring liberal pet projects over the basic needs of the American people.
The reason we can predict this with confidence stares out at us from the Bureau of Labor Statistics employment numbers. The reason that unemployment is a mere ten percent and not up at eleven to twelve percent at this moment is that many people have given up looking for work. Here is a chart on the labor force.
The chart tells us that if the labor force had expanded at a normal rate since 2007, then it should be about 157 million by now. But in fact, it is down at 153 million. Four million people have dropped out of the labor force and have stopped looking for work. Imagine what will happen when businesses start hiring again and discouraged job-seekers start reporting that they are looking for work. That 4 million in missing workers will turn up on the unemployment column. If unemployment were to go from its present 15 million to 19 million, then unemployment would go up to 12.1 percent.
Let's be generous to the president, as we pundits should be when a Democrat is in the White House. All those discouraged people aren't going to jump back into the labor force at once, so unemployment won't jump to 12 percent overnight and humiliate him. Probably, the unemployment rate will get up to only about 11 percent.
Our friends in the mainstream media will have to summon all their considerable journalistic talent to remind the American people in objective news reports that despite the harrowing unemployment numbers, the nation's economy is really in good hands.