Obama's Unemployment rate is actually 14.9%

[_bcspace]

While the national unemployment rate paints a grim picture, a look at individual states and their so-called real jobless rates becomes even more troubling.

The government's most widely publicized unemployment rate measures only those who are out of a job and currently looking for work. It does not count discouraged potential employees who have quit looking, nor those who are underemployed — wanting to work full-time but forced to work part-time.

For that count, the government releases a separate number called the "U-6," which provides a more complete tally of how many people really are out of work.

The numbers in some cases are startling.

Consider: Nevada's U-6 rate is 22.1 percent, up from just 7.6 percent in 2007. Economically troubled California has a 20.3 percent real rate, while Rhode Island is at 18.3 percent, more than double its 8.3 percent rate in 2007.

Those numbers compare especially unfavorably to the national rate, high in itself at 14.9 percent though off its record peak of 17.2 percent in October 2009.

Only three states — Nebraska (9.1 percent), South Dakota (8.6 percent) and North Dakota (6.1 percent) — have U-6 rates under 10 percent, according to research from RBC Capital Markets.

Election battleground states paint a picture not much more flattering. Florida's U-6 number is an ugly 17 percent, though Pennsylvania and Ohio are both around 14 percent, below the national U-6 average.

The numbers come as the government prepares to release its latest reading, the July nonfarm payrolls number, on Friday. Economists expect the report show about 100,000 jobs created for the month and the traditional "U-3" rate to hold steady at 8.2 percent.

"The lack of improvement in state U-6 rates continues to be troubling," Chris Mauro, head of US Municipals Strategy at RBC, said in a research note. "While down from recent peaks, state U-6 levels remain dramatically higher than they were in 2007 and 2008."

Mauro used the numbers to demonstrate that investing in municipal bonds remains a challenge because high real unemployment rates will be a drain on local finances.

"We remain concerned about the corrosive influence that these stubbornly high U-6 rates may have on both consumer sentiment and state and local tax revenues," he said. "At current levels, these U-6 rates will continue to be a drag on credit quality."

http://www.cnbc.com/id/48468748

[_MeDotOrg]

First of all, unemployment is high. It is the single greatest concern facing the US economy, bigger than the deficit, because if we don't get unemployment down, we'll never have to the revenue to get the deficit down.

But let's compare apples to apples and oranges to oranges. Under Reagan, the U6 rate went as high at 20%.

This economic meltdown that began in 2007 and peaked in 2008 had destroyed 3.4 TRILLION dollars of wealth worldwide by March 2009. It's difficult to comprehend the losses. If it hadn't been for the stimulus, we could have had a depression that would have matched or even exceed 1929-1933. As much as the stimulus was, it wasn't enough.

Everybody lost wealth. When you lose wealth, you pull back spending. When you pull back spending, it creates less wealth. It's a re-enforcing cycle. Somebody has to step up and start spending.

No matter who is elected President, it's going to be a long painful slog out of this economic hole we've dug for ourselves.

[_Brackite]

...

Consider: Nevada's U-6 rate is 22.1 percent, up from just 7.6 percent in 2007. Economically troubled California has a 20.3 percent real rate, while Rhode Island is at 18.3 percent, more than double its 8.3 percent rate in 2007.

...

California is a Liberal State, which has a Democratic Governor. The Democratic Party has controlled both the State Assembly and the State Senate in California since 1996.

...

Only three states — Nebraska (9.1 percent), South Dakota (8.6 percent) and North Dakota (6.1 percent) — have U-6 rates under 10 percent, according to research from RBC Capital Markets.

...

Nebraska, South Dakota, and North Dakota are all Conservative States, which have Republican Governors.

[_Brackite]

The National Unemployment rate has been over eight percent for 42 straight months under the Presidency of Barack Obama.

http://data.bls.gov/timeseries/LNS14000000

[_Kevin Graham]

The National Unemployment rate has been over eight percent for 42 straight months under the Presidency of Barack Obama.

http://data.bls.gov/timeseries/LNS14000000

Which is understandable given the circumstances. Thanks to Right Wing politics, more than a million jobs have been cut from the public sector, while the private sector continues to add jobs.

Remember several years ago the myth was that Obama was a socialist whose only plan to increase employment was to dump so much money into the government that it would hire millions of temp workers.

In fact, the opposite has happened. If Obama is such a hindrance to private sector employment, then why has it continued to produce jobs over the past three years?



Reagan's recovery from a much milder recession was aided in large part to a drastic increase in government spending which jacked up public sector employment. It also benefited from drastic cuts to interest rates. If government wasn't hindered by Right Wing politics, then it could do what was done under Reagan: produce 1.3 million more jobs as schoolteachers, firefighters, police officers, etc.

Every where you turn in history, you see that the "Liberal" plan works. All the things that made Reagan's recovery work are precisely the things Obama can't do, mainly because he is up against a congress that is dead set on voting against anything he tries. The same is true under Bush:



That's the irony. The Rand/Hayek philosophy that is so adored by Loran is to starve government and make it as small as possible and then, the theory goes, things will be much better for the overall economy. And yet those more likely to dump billions into government spending have been Republicans.

We now know that if employment in the public sector had remained steady, the unemployment rate would be much lower than it is now. And if it had increased as much as Obama proposed, then unemployment could be well under 7% by now. But thanks to Republicans getting their way, he can't pass much of anything, and the end result is bad for America. But Republicans don't care because they know everyone will blame the President.



In other words, a full percentage point of unemployment is owed to all those government-spending-cutting Right Wing Governors Brackite loves to brag about.

The Obama administration's jobs bill would have given about $35 billion to state and local governments to prevent many of these public sector job losses, but because of a Republican filibuster, the bill has languished. Since then, the public sector has lost 124,000 jobs.

The Reagan recovery is also owed to a large increase in government spending and the Federal Reserve lowering interest rates.

The Congressional Budget Office explained that because the 1980s recession was caused "by monetary restriction aimed at bringing inflation under control," "[l]ower interest rates after mid-1982 permitted the recovery to begin." Today's Federal Reserve does not have this same ability, because the interest rates are already nearly 0.

What's more, President Reagan greatly increased government spending to aid the economic recovery. In contrast, government spending under President Obama is falling at a rate of 1.4 percent, the first decline in real spending since the 1970s, as The Wall Street Journal noted:

Man, Obama really sucks as a "Socialist"!

And what I have tried to explain several times in the past is that cutting the top marginal tax rate doesn't end recessions and the Reagan recession was no exception.

Michael Mussa, a member of Reagan's Council of Economic Advisers, wrote in an essay for American Economic Policy in the 1980s (University of Chicago Press, 1995) that when the Federal Reserve cut the discount rate a half percentage point on July 20, 1982, it "signal[ed] the beginning of what would become a four-and-a-half-year period of quite rapid monetary expansion. During this period, interest rates, both short and long term, would be driven significantly lower, and the U.S. economy would substantially recover from the devastation of both inflation and recession." [American Economic Policy in the 1980s, 9/1/95, via Google Books]

An August 1983 CBO report titled "The Economic and Budget Outlook: An Update" concluded that "[l]ower interest rates after mid-1982 permitted the recovery to begin":

Recovery started in December 1982 from the deepest postwar recession, the second of two since 1980. Both recessions were brought on by monetary restriction aimed at bringing inflation under control. Lower interest rates after mid-1982 permitted the recovery to begin. Real GNP grew at a 2.6 percent annual rate in the first quarter and at an 8.7 percent annual rate in the second quarter of 1983. [Congressional Budget Office, August 1983]

Now if Reagan's own economists didn't think the increased employment was due to tax cuts, then why should anyone else? This is just another myth and one that was gradually created during the Reagan-worship period after Clinton, mostly by the talk radio idiots and Think Tanks on the Right. It is a classic example of the cause-effect fallacy used to confuse and deceive simple minded folks like Droopy.

[_Kevin Graham]

Businessweek: "Obama's Critics Call For A Return To Reaganomics, But The Gipper's Downturn Was No Match For This One." From a Feb 2 Bloomberg Businessweek article titled "A Tale of Two Election Year Recoveries":

Obama has struggled to master a far more complex situation. The Reagan recession was sparked by the high inflation of the Jimmy Carter years and the decision by then-Federal Reserve Chairman Paul Volcker to raise interest rates to as high as 20 percent in May 1981 to smother higher prices. Although the high rates caused a lot of pain, they left Volcker with plenty of room to cut until the recession had eased. Rate cuts started in June 1981. By December 1982, rates were down to 8.5 percent. The economy responded quickly to monetary easing. Fed Chairman Ben Bernanke, in contrast, has little room left for cuts; the federal funds rate is close to zero. "When you have a deep financial crisis paired with recession, it's a completely different animal than a normal recession," says Kenneth Rogoff, an economics professor at Harvard University. "The one in the Reagan Administration was a more normal one."

The presence of so much debt in the economy makes companies and consumers reluctant to borrow and banks reluctant to lend, no matter how low interest rates go. Debt today remains a greater drag on the U.S. than in 1983, says Carmen Reinhart, a senior fellow at the Peterson Institute for International Economics in Washington and co-author, with Rogoff, of This Time Is Different: Eight Centuries of Financial Folly. In the third quarter of 2011, household debt was 86 percent of GDP, compared with 47 percent in the third quarter of 1983, according to the U.S. Commerce Dept. "The capacity for households to be the engine of growth that they have been in past recoveries is simply not there," Reinhart says.

[...]

"Reagan could talk about morning in America and could come from that perspective," says Peter D. Hart, who was a pollster for Walter Mondale, Reagan's Democratic opponent in 1984. "The major difference this time is that Americans are much more likely to believe we are in a long-term decline." Reagan, too, might have to struggle to convince voters it's morning in America in 2012. [Bloomberg Businessweek, 2/2/12]

[_MeDotOrg]

Obama has struggled to master a far more complex situation. The Reagan recession was sparked by the high inflation of the Jimmy Carter years and the decision by then-Federal Reserve Chairman Paul Volcker to raise interest rates to as high as 20 percent in May 1981 to smother higher prices. Although the high rates caused a lot of pain, they left Volcker with plenty of room to cut until the recession had eased. Rate cuts started in June 1981.

Good posts, Kevin. This is not the recession of 1980, either in its cause or severity.

Alan Greenspan called the Recession/Crash of 2007-2008 a '100-year storm'. Personally I think he gave it that description to give himself a little cover (how could we have seen this coming?). But it is unquestionably the biggest financial crisis this country has seen since the Great Depression.

I would be curious to know if any recession of this magnitude has been cured by giving greater tax breaks to the rich. You can give a farmer free seeds, but he's not going to plant them if he doesn't think the crop will come in. As Analytics has pointed out, Apple is sitting on $100 billion right now. I don't see them building factories in the Unites States anytime soon.

Somebody has to prime the pump. And that historically that someone has been the government.

[_palerobber]

congratulations on discovering the U6 rate, moron.

bottom line:
U6 at Bush's first month in office: 7.4%
U6 at Obama's first month in office: 15.1% (and rocketing upwards)
U6 at Jul 2012: 15.0%

[_Brackite]

In other words, a full percentage point of unemployment is owed to all those government-spending-cutting Right Wing Governors Brackite loves to brag about.

The Following Article is From the Washington Post:

Red states versus blue states: Who’s laying off more government workers?

...

When President Obama touts his record on creating jobs, he usually focuses on private-sector job growth. That’s no accident, because government jobs have been in a steep decline, especially at the state and local level, as many governors have slashed jobs (especially for teachers) to meet requirements that they keep their budgets balanced.

The decline in government jobs, which started in earnest when Obama’s federal stimulus funds ran low, has been a major factor in the anemic job creation during Obama’s tenure. But how much is a president to blame for that?

As readers of this column know, we frown on the journalistic and political artifice of pretending that a president, as soon as he takes the oath of office, is responsible for every facet of the economy. The relationship between a president and state and local government jobs is even more tenuous, because those jobs are dependent on the decisions of other elected officials — governors and state legislators. The overall state of the national economy certainly plays a role in those decisions, but those other officials may have different agendas than the president.

Indeed, some have argued that Republican takeovers at the state level in 2010 elections have led to severe cutbacks in public workforces.

When a reader asked us whether “Red” (Republican) states accounted for more job losses than “Blue” (Democratic) states during Obama’s presidency, we decided to investigate. We used Bureau of Labor Statistics data and the help of the incomparable Lori Williams at Tableau Software. We make no judgment about whether reductions in state and local government jobs are justified--some readers might believe state budgets are bloated--but simply want to explore what has happened in the past three years.


The Facts

The question is actually a difficult one to answer. There are few pure Red or Blue states. There are states led by Democratic governors, with Republican legislatures, or visa versa. There are state legislatures split between Democrats and Republicans. Moreover, there are data on state government jobs and on local (city and county) government jobs, which of course are heavily influenced by state budget funds.

While some states, such as North Dakota with its newfound oil riches, have added government jobs, the data demonstrate the grim budget picture that most states have faced. An analysis by the Center on Budget and Policy Priorities has found that as stimulus funds dried up, many states responded with spending cuts, not revenue increases, to close the gap.

The visual below starts with the first month of Obama’s presidency — January 2009. To keep things simple, we labeled a state as Democrat or Republican based on current affiliation, though obviously there have been some party shifts, because most of the losses have occurred more recently.

We show the results in percentages because raw numbers are often misleading (using raw numbers, Democratic-led California by itself accounts for a large chunk of the overall job losses.)

The visual below reveals that:

1. Democratic governors and legislatures had a much better record on state government jobs, cutting them by a smaller percentage than their Republican counterparts.

2. Republican governors and legislatures, by contrast, did much better on local government jobs.

3. Legislatures that are split between the parties had the best performance of all.

4. There is virtually no difference between Republicans and Democrats when the state and local jobs are combined.

...

Link: http://www.washingtonpost.com/blogs/fac ... _blog.html



The Four States that now have The Lowest Unemployment rates in the Nation have Republicans as Governors there.

http://www.bls.gov/web/laus/laumstrk.htm