Friday, July 2, 2010

Jobs & Unemployment

According to Obama, this morning, our economy is moving in the right direction.

In claiming that we are recovering, he ignored the specifics of today's job's report and other economic indicators - that unemployment (U-3) is at 9.5%; that our economy shed another 125,000 jobs; that the work force contracted; that the average hourly earnings decreased; and that the actual measure of unemployment / underemployment stood at $16.5%. The sum total of these indicators point to "a rather serious softening in the employment market." Indeed, the "percentage of the overall working-age population that is in the labor force fell last month to 64.7% -- near a 25-year low." Further, Obama failed to note another ominous indicator:

New orders for factory products tumbled much more than expected in May, posting their sharpest drop since the depth of the recession and their first decline in nine months, a government report showed on Friday.

Ignoring all of the above, Obama claims that, this year alone, "government" created "600,000 private sector jobs." That is laughable.

The reality is that we have hemorrhaged over 8 million jobs since this recession began. As to Obama's arrogant assertion that he has created 600,000 private sector jobs - the government cannot create a single private sector job. What the government can do is twofold. One, government can direct funding for government contracts to the private sector. But Obama has gerrymandered that process by freezing out non-union businesses that make up 92% of the private sector.

Beyond such government contracting, government can only create the conditions effecting the entire economy that will help or hurt private sector employment. As near as I can tell, there is nothing that Obama has done to positively effect the economic environment. To the contrary, his massive increase in spending and entitlements, with the promise of more taxes and entitlements to follow, are creating the conditions for economic malaise. Indeed, Obama is directing our economy on a downward spiral of historic proportions. The graph below shows current job losses in comparison to previous post-WWII recessions:

So how is the left attempting to address this mismanagement of epic proportions? Beyond the fantasies spun by Obama, there is the effort to paint Republicans as heartless for refusing to sign yet another blank check to extend unemployment benefits. It is actually rather comic, between Nancy Pelosi claiming that unemployment benefits are the best method to increase employment to Harry Reid, et. al, screaming that the Republicans are intransigent and unfeeling while it is they themselves that are refusing any deal:

Congress adjourns this week for the July Fourth recess without having passed a bill to extend unemployment insurance benefits to 1.3 million people who started losing them this month.

Democrats have been painting Republicans as unsympathetic to the long-term unemployed who will be unable to collect benefits, but Democratic leaders have rejected several offers by the GOP to vote for the bill if at least some of it is paid for.

"My concern is that the Democrats are more interested in having this issue to demagogue for political gamesmanship than they are in simply passing the benefits extension," said Sen. George Voinovich, R-Ohio, who offered a deal that was rejected by Sen. Majority Leader Harry Reid, D-Nev.

Democratic leaders were quick to attack Republicans for opposing the benefits, with House Speaker Nancy Pelosi, D-Calif., calling their opposition "just cruel" and "contrary to what our country is about."

Republicans, meanwhile, stood firm in their argument that extending benefits should not add to the deficit.

Voinovich told Reid he would vote for extending benefits if at least half of the extension could be paid for with unused money from the $787 billion stimulus package.

"I came to the table with a fair compromise, and the ball is in their court," said Voinovich, whose state suffers from a 10.7 percent unemployment rate. . . .

Obama should be doing everything possible to create the environment for private sector job creation. It goes without saying that his administration is on the opposite course.

1 comment:

Paul_In_Houston said...

If you could actually engage Obama about the tech jobs lost since he came into power, he would probably respond, "Those were the wrong kind of jobs. When I said "shovel ready", I meant "shovel ready". :(