Monday, July 23, 2012

Welcome To Obama's Unemployed Economy


It has been 3-1/2 years since Barack Obama took over as President of the United States.  During that time, he claims to have "created" millions of jobs, but the record says that any job creation has been just enough to tread water... there has been no employment improvement during his term.  The U.S. Unemployment Rate under Obama is above January, 2009 when he took office. [source]

The number of unemployed persons [in thousands] has not been reduced since Barack Obama took over as President of the United States. [source]

During the time since Barack Obama took over as President of the United States, the U.S. national debt has skyrocketed, tax rates are about to go up, spending on government programs has run amok, and what do we have to show for it?
A stimulus bill equivalent to 1,567 Golden Gate bridges. A 2011 federal budget equivalent to 6,788 Golden Gate bridges. And yet we don't have a single one. 
Because that's not what Big Government does: Money-no-object government spends more and more money for less and less objects. For all the American economy has to show for it, President Bob the Builder took just shy of a trillion dollars in stimulus, stuck it in his wheelbarrow, pushed it halfway across the Golden Gate Bridge, and tossed it into the Pacific. 
Instead of roads and bridges, Obama-sized government funds stasis and sclerosis: The Hoover Dam of regulatory obstruction, the Golden Gateway to dependency. Last month, 80,000 Americans signed on to new jobs, but 85,000 Americans signed on for Social Security disability checks. Most of these people are not "disabled" as that term is generally understood. Rather, it's the U.S. economy that's disabled, and thus Obama incentivizes dependency. What Big Government is doing to those 85,000 "disabled" is profoundly wicked. Let me quote a guy called Mark Steyn, from his last book: 
"The evil of such a system is not the waste of money but the waste of people. Tony Blair's ministry discovered it was politically helpful to reclassify a chunk of the unemployed as 'disabled.' A fit, able-bodied 40-year-old who has been on disability allowance for a decade understands somewhere at the back of his mind that he is living a lie, and that not just the government but his family and his friends are colluding in that lie."   [source]
And so where do we stand on the cusp of President Barack Obama's re-election victory?

US poverty on track to rise to highest since 1960s

US poverty on track to reach 46-year high; suburbs, underemployed workers, children hit hard

WASHINGTON (AP) -- The ranks of America's poor are on track to climb to levels unseen in nearly half a century, erasing gains from the war on poverty in the 1960s amid a weak economy and fraying government safety net.
Census figures for 2011 will be released this fall in the critical weeks ahead of the November elections.
The Associated Press surveyed more than a dozen economists, think tanks and academics, both nonpartisan and those with known liberal or conservative leanings, and found a broad consensus: The official poverty rate will rise from 15.1 percent in 2010, climbing as high as 15.7 percent. Several predicted a more modest gain, but even a 0.1 percentage point increase would put poverty at the highest level since 1965.
Poverty is spreading at record levels across many groups, from underemployed workers and suburban families to the poorest poor. More discouraged workers are giving up on the job market, leaving them vulnerable as unemployment aid begins to run out. Suburbs are seeing increases in poverty, including in such political battlegrounds as Colorado, Florida and Nevada, where voters are coping with a new norm of living hand to mouth. [source]
So, Mr. President, just what about your term as President of the United States, qualifies you for a second term?  IT CAN'T BE THE ECONOMY.

The fact that your Democratic Party Congress and you conspired to pass the largest government program in history?  The fact that your Justice Department and you have repeatedly ignored laws passed by Congress?  The fact that you have an activist anti-energy/anti-business Environmental Protection Agency?  The fact that your foreign policy is focused on supporting the ascendancy of the Muslim Brotherhood throughout the Middle East and Northern Africa?

Tell us again why you should have another term.

2012 IS HERE


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There is always an easy solution to every human problem—neat, plausible, and wrong.
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“The Divine Afflatus,” A Mencken Chrestomathy, chapter 25, p. 443 (1949)
... and one could add "not all human problems really are."
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Tracking Interest Rates

Tracking Interest Rates


SEARCH BLOG: FEDERAL RESERVE for full versions... or use the Blog Archive pulldown menu.

February 3, 2006
Go back to 1999-2000 and see what the Fed did. They are following the same pattern for 2005-06. If it ain't broke, the Fed will fix it... and good!
August 29, 2006 The Federal Reserve always acts on old information... and is the only cause of U.S. recessions.
December 5, 2006 Last spring I wrote about what I saw to be a sharp downturn in the economy in the "rustbelt" states, particularly Michigan.
March 28, 2007
The Federal Reserve sees no need to cut interest rates in the light of adverse recent economic data, Ben Bernanke said on Wednesday.
The Fed chairman said ”to date, the incoming data have supported the view that the current stance of policy is likely to foster sustainable economic growth and a gradual ebbing in core inflation”.

July 21, 2007 My guess is that if there is an interest rate change, a cut is more likely than an increase. The key variables to be watching at this point are real estate prices and the inventory of unsold homes.
August 11, 2007 I suspect that within 6 months the Federal Reserve will be forced to lower interest rates before housing becomes a black hole.
September 11, 2007 It only means that the overall process has flaws guaranteeing it will be slow in responding to changes in the economy... and tend to over-react as a result.
September 18, 2007 I think a 4% rate is really what is needed to turn the economy back on the right course. The rate may not get there, but more cuts will be needed with employment rates down and foreclosure rates up.
October 25, 2007 How long will it be before I will be able to write: "The Federal Reserve lowered its lending rate to 4% in response to the collapse of the U.S. housing market and massive numbers of foreclosures that threaten the banking and mortgage sectors."
"Should the elevated turbulence persist, it would increase the possibility of further tightening in financial conditions for households and businesses," he said.

"Uncertainties about the economic outlook are unusually high right now," he said. "These uncertainties require flexible and pragmatic policymaking -- nimble is the adjective I used a few weeks ago."

December 11, 2007 Somehow the Fed misses the obvious.
[Image from:]
December 13, 2007 [from The Christian Science Monitor]
"The odds of a recession are now above 50 percent," says Mark Zandi, chief economist at Moody's "We are right on the edge of a recession in part because of the Fed's reluctance to reduce interest rates more aggressively." [see my comments of September 11]
January 7, 2008 The real problem now is that consumers can't rescue the economy and manufacturing, which is already weakening, will continue to weaken. We've gutted the forces that could avoid a downturn. The question is not whether there will be a recession, but can it be dampened sufficiently so that it is very short.
January 11, 2008 This is death by a thousand cuts.
January 13, 2008 [N.Y. Times]
“The question is not whether we will have a recession, but how deep and prolonged it will be,” said David Rosenberg, the chief North American economist at Merrill Lynch. “Even if the Fed’s moves are going to work, it will not show up until the later part of 2008 or 2009.
January 17, 2008 A few days ago, Anna Schwartz, nonagenarian economist, implicated the Federal Reserve as the cause of the present lending crisis [from the Telegraph - UK]:
The high priestess of US monetarism - a revered figure at the Fed - says the central bank is itself the chief cause of the credit bubble, and now seems stunned as the consequences of its own actions engulf the financial system. "The new group at the Fed is not equal to the problem that faces it," she says, daring to utter a thought that fellow critics mostly utter sotto voce.
January 22, 2008 The cut has become infected and a limb is in danger. Ben Bernanke is panicking and the Fed has its emergency triage team cutting rates... this time by 3/4%. ...

What should the Federal Reserve do now? Step back... and don't be so anxious to raise rates at the first sign of economic improvement.
Individuals and businesses need stability in their financial cost structures so that they can plan effectively and keep their ships afloat. Wildly fluctuating rates... regardless of what the absolute levels are... create problems. Either too much spending or too much fear. It's just not that difficult to comprehend. Why has it been so difficult for the Fed?

About Me

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Michigan, United States
Air Force (SAC) captain 1968-72. Retired after 35 years of business and logistical planning, including running a small business. Two sons with advanced degrees; one with a business and pre-law degree. Beautiful wife who has put up with me for 4 decades. Education: B.A. (Sociology major; minors in philosopy, English literature, and German) M.S. Operations Management (like a mixture of an MBA with logistical planning)