The Great Recession has now earned the dubious right of being compared to the Great Depression. In the face of the most stimulative fiscal and monetary policies in our history, we have experienced the loss of over 7 million jobs, wiping out every job gained since the year 2000. From the moment the Obama administration came into office, there have been no net increases in full-time jobs, only in part-time jobs. This is contrary to all previous recessions. Employers are not recalling the workers they laid off from full-time employment.
The real job losses are greater than the estimate of 7.5 million. They are closer to 10.5 million, as 3 million people have stopped looking for work. Equally troublesome is the lower labor participation rate; some 5 million jobs have vanished from manufacturing, long America's greatest strength. Just think: Total payrolls today amount to 131 million, but this figure is lower than it was at the beginning of the year 2000, even though our population has grown by nearly 30 million.
The most recent statistics are unsettling and dismaying, despite the increase of 54,000 jobs in the May numbers. Nonagricultural full-time employment actually fell by 142,000, on top of the 291,000 decline the preceding month. Half of the new jobs created are in temporary help agencies, as firms resist hiring full-time workers. [Check out a roundup of political cartoons on the economy.]
Today, over 14 million people are unemployed. We now have more idle men and women than at any time since the Great Depression. Nearly seven people in the labor pool compete for every job opening. Hiring announcements have plunged to 10,248 in May, down from 59,648 in April. Hiring is now 17 percent lower than the lowest level in the 2001-02 downturn. One fifth of all men of prime working age are not getting up and going to work. Equally disturbing is that the number of people unemployed for six months or longer grew 361,000 to 6.2 million, increasing their share of the unemployed to 45.1 percent. We face the specter that long-term unemployment is becoming structural and not just cyclical, raising the risk that the jobless will lose their skills and become permanently unemployable.
Don't pay too much attention to the headline unemployment rate of 9.1 percent. It is scary enough, but it is a gloss on the reality. These numbers do not include the millions who have stopped looking for a job or who are working part time but would work full time if a position were available. And they count only those people who have actively applied for a job within the last four weeks.
Include those others and the real number is a nasty 16 percent. The 16 percent includes 8.5 million part-timers who want to work full time (which is double the historical norm) and those who have applied for a job within the last six months, including many of the long-term unemployed. And this 16 percent does not take into account the discouraged workers who have left the labor force. The fact is that the longer duration of six months is the more relevant testing period since the mean duration of unemployment is now 39.7 weeks, an increase from 37.1 weeks in February.
The inescapable bottom line is an unprecedented slack in the U.S. labor market. Labor's share of national income has fallen to the lowest level in modern history, down to 57.5 percent in the first quarter as compared to 59.8 percent when the so-called recovery began. This reflects not only the 7 million fewer workers but the fact that wages for part-time workers now average $19,000--less than half the median income. Hope and change! The problem is, this has been a disaster some 10-15 years in the making. The loss of manufacturing due to competition, housing bubbles popping and staggering personal and national debt have lead to a perfect storm of economic poo. It will take a long time to climb out of this no matter who is in office. We just don't need someone like Obumble stomping us on the head every time the country tries to climb up a rung.
#1
This disaster is 80 years in the making. The blue model is dying. We are finished living off the capital gain associated with being the only modern country not devastated by WWII. Time to get back to work the old fashioned way. Only too few remember what that means. Only time will solve this problem. And maybe WWIII.
Posted by: Water Modem ||
06/22/2011 13:37 Comments ||
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#4
It will take a long time to climb out of this no matter who is in office. It will take a far longer time than that for the electorate to grasp this. Meanwhile incumbents and their challengers can demagogue this issue to death, or until their retirement, whichever comes first.
The stimulus has mostly gone into the pockets of the same people who cause this crisis. The bill for the stimulus, however, will be paid by the taxpayers in years to come, one way or the other.
Severe unemployment lasting for decades will produce severe short term and long term changes in the country. Unless a solid gold meteorite of sufficient size crashes into federal land somewhere (preferably taking out many incumbent politicians) this is not going to suddenly improve.
The Federal Reserve has 2 main missions by law: to maintain stable prices (in plain English, no inflation) and an optimal level of unemployment. It has failed & continues to fail on both these goals, and there is no sign that Fed policies will achieve its statutory goals, now or ever.
#5
On the other hand, a recent poll: In the poll, 49 percent of respondents said theyre worried about Republicans gaining control of the White House and Congress and following through on pledges to slash funding for benefit programs like Medicare and Medicaid, outnumbering the 40 percent who said they are concerned about another term for Obama and a continuation of current spending policies. Among independents, 47 percent said they are worried about a Republican takeover compared with 37 percent who are concerned about maintaining the status quo.
The poll did not ask those polled if they were worried about economic collapse of the USA if business as usual by Obama continues for another term. Nor did it ask, "Which state is Columbus, Ohio, the capitol of?"
We want more liberty,
and prison for droopey drawers.
We want a flexiable workforce,
and wonder about why we got so many Messicans.
We want cheap food,
and bitch about farm subsidies.
We want less government,
and bitch about the size of our peanut alotment.
We want Voter ID,
but no National ID.
More roads,
More rail,
Better ships,
More Subs,
Next Gen-CVN
Jobs, Jobs, Jobs, Jobs, Jobs, Jobs, Jobs
Good paying Jobs.
With healthcare.
And maternal leave.
And daycare.
And a Pony in 2018 for every damn child.
Meh.
Also Housing is TOO DAMN HIGH
And of course.... Sweet damn Jesus... Gasoline is over $4.00 a gallon, a Blue Ribbons Commission of pinning blame should be named. Outrageous! Contact your congress critter today and bitch like mad at him/her, that's why we pay them so damn much.
Posted by: Goldies Every Damn Where ||
06/22/2011 15:51 Comments ||
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#7
I blame two factors. Clinton's giving permanent "Most Favored" trading status to China, and Obama's perpetual Obama-isms that destroy growth. Sadly, Bush the Great (W.) was distracted by 9/11 and could not do more to counter the Socialist job-killing agenda. And Osama laughs from the grave, as destroying our economy was his primary goal. He was successful!
#8
> The loss of manufacturing due to competition, housing bubbles popping and staggering personal and national debt have lead to a perfect storm of economic poo.
All these have one cause.
Manufacturing failing to compete is because America taxes incomes which increase costs, lower employment and wages.
In order to hide the damage to money velocity the government uses increases in DEBT.
It does this by lowering reserve requirements.
Increased debt lowers the affordability of housing.
Increased debt lowers yields. When lowered below the risk default is inevitable.
America needs to tax Land Rights and IP rights, not people working.
#9
There is a remarkably simple solution, asset deflation, which transfers assets from people who had made money from them or acquired them from people who had made money from them (eg the government), to people who will make money from them. Creating employment, wealth, etc. in the process.
Of course it crashes the banks who have lent against the inflated value of these assets, but that gonna happen anyway.
"This disaster is 80 years in the making. The blue model is dying. We are finished living off the capital gain associated with being the only modern country not devastated by WWII. Time to get back to work the old fashioned way."
You said it, mister.
All the other stuff on this thread, though true, is subservient to this single issue.
I nominate not just this thread, but your comment, for the Rantburg Classics page.
Posted by: no mo uro ||
06/22/2011 19:40 Comments ||
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#11
Yep, phil_b. Investment wealth is just an illusion. A fiction of transferring excess productivity at one time as a claim against excess productivity at some future time. If the future excess productivity does not come to exist, the claim is valueless.
THE REAL BAD NEWS IS THAT VARIOUS NETTERS ARGUE THAT ANY SUCH "LOST DECADE" SHOULD ACTUALLY BE "DECADES" - PLURAL - NOT "DECADE"???
* Also from SAME > US IN AGRICULTURAL CRISIS TOWARDS YEAR 2050.
> 450.0Milyuhn National Population by 2050.
> US to have NON-WHITE MAJORITY POPULATION [slight] by 2050.
> US, World suffering from INCREASING FOOD DEFICITS.
> Dedicated US FARMERS comprise tiny Percentage of US national, food sector/production population + is expected to decline further.
> US - NOT ENOUGH YOUNG PEOPLE = REPLACEMENT WORKERS, FARM OWNERS TO TAKE OVER FROM AGING US FARMERS.
> US = TRILINGUAL by 2050, i,e. Hispanic, Swahili
[African-AMer], English???
and
* SAME >[Michael Payne] HEED THE WARNING SIGNS: AMERICA IS [steadily] EDGING CLOSER TO SOCIETAL IMPLOSION.
Espec vee "BLOWBACK", i.e. MAINSTREAM ANGER, FRUSTRATION AT PERCEIVED INTENTIONAL + UNFAIR + MALICIOUS EXPLOITATION, DECEPTION, OTHER ABUSE BY POLITICAL + ECON LEADERS.
Rich unfairly getting richer, Poor unfairly getting poorer = recipe for Anarchy, Revolution, + Collapse. RICH CONTROLLING ANY + ALL THE GUNS = FIREPOWER, ETC. ISN'T GONNA BE ENUFF TO STOP IT.
#13
Hyper-power, Hyper-PCorrect America = Amerika is not invincible nor immune from any of the dynamic forces that affect other World States-Powers e.g. TWO/MULTI-STATE SOLUTION? FOR CONUS.
Back before the Unites States was an independent nation, people lived in horrific conditions under British rule. The British werent providing very good free health care (wait time for a poor person to get an MRI was over 200 years), they were refusing to increase taxes on the rich, and they had very few laws dictating what colonists were allowed to eat, causing many to become obese on the high-fructose maize syrup the Indians taught them to make.
So the colonists kept demanding that the British give them big government to regulate their lives and provide for their basic needs while confiscating all their wealth. Were stupid, theyd cry out to the British. Please rule us and make us do what you think is best! But the British kept refusing, saying, No, you guys are doing okay by yourselves. We want you to have the freedom to run your own lives.
It was this laissez-faire attitude that led to the Boston Massacre, in which five people died of heart attacks in Boston from eating fatty foods a proper government would never have let them eat in the first place. Finally the colonists had enough of not being bossed around and decided if the British werent going to provide them the all-encompassing government they wanted, they had to make it themselves.
They started by throwing tea into the Boston Harbor since they determined it had too much caffeine and people shouldnt have been allowed to drink it. Then they formed militias to collect more taxes from the colonists to spend on welfare and government works projects. The British tried to strike back by ending regulations and giving tax rebates, but the colonists were now ready to fight to make sure some large entity would tell them what to do. And many were rallied to the cause by Patrick Henrys cry of Give me a large government telling me what I can and cant do while spending most of my money, or give me death!
Soon, Thomas Jefferson penned the Declaration of Independence, which includes the famous line, We hold these truths to be revealed after careful study by Ivy League-educated people, that all men are in need of constant care and supervision, that they are endowed by the highly-educated intellectual class with certain unalienable Rights, that among these are free Health Care, strict and expansive Regulations on all activities, and the pursuit of Big Government.
The Federal Reserve Bank of New York is refusing to tell U.S. government investigators how much money it sent to Iraq during the first years of the American invasion, as a top Iraqi official suggested the missing and possibly stolen funds from that era is more than $18 billion -- nearly three times the previously reported figure.
CNBC reported Tuesday that the New York Fed won't reveal to the special inspector general for Iraq reconstruction how much money went to the Middle Eastern nation, hampering an investigation seeking to determine how much of the cash was stolen.
And Iraqi parliament speaker Osama al-Nujafi told al-Jazeera Monday that the missing U.S. funds totals $18.7 billion.
"Iraq's development fund has lost around $18 billion of Iraqi money in these operations - their location is unknown," al-Nujafi said. "Also missing are the documents of expenditure. I think it will be discussed soon. There should be an answer to where has Iraqi money gone."
Last week, a congressional auditor estimated $6.6 billion of Bush-era reconstruction funds were stolen, suggesting "the largest theft of funds in national history."
The New York Fed won't reveal details, Special Inspector General for Iraq Reconstruction Stuart Bowen Jr. told CNBC, because technically the money came from an Iraqi government account, and the Iraqi government hasn't signed off on allowing access to that information.
"My frustration is not with the New York Fed, it is with the Iraqis," Bowen said. "They haven't been sufficiently responsive."
In fact, the Iraqi government may not want the U.S. to know because it may be Iraqi officials themselves who made off with the cash.
The Pentagon has long said it could determine what happened to the money if given time, but it has yet to do so. Iraq's government says the U.S., which controlled the country at the time, is responsible for the funds.
A multi-volume chronology and reference guide set detailing three years of the Mexican Drug War between 2010 and 2012.
Rantburg.com and borderlandbeat.com correspondent and author Chris Covert presents his first non-fiction work detailing
the drug and gang related violence in Mexico.
Chris gives us Mexican press dispatches of drug and gang war violence
over three years, presented in a multi volume set intended to chronicle the death, violence and mayhem which has
dominated Mexico for six years.
Rantburg was assembled from recycled algorithms in the United States of America. No
trees were destroyed in the production of this weblog. We did hurt some, though. Sorry.
The Great Recession has now earned the dubious right of being compared to the Great Depression. In the face of the most stimulative fiscal and monetary policies in our history, we have experienced the loss of over 7 million jobs, wiping out every job gained since the year 2000. From the moment the Obama administration came into office, there have been no net increases in full-time jobs, only in part-time jobs. This is contrary to all previous recessions. Employers are not recalling the workers they laid off from full-time employment.
