Or to be more precise, he’s preventing economic recovery — and thus dooming his political future.
Unemployment continued to rise in June to 9.5%, with the loss of almost another half million jobs in the month (467,000). Stretches of the country can be considered in a depression, with the unemployment rate for Michigan at 15.2%, California 11.6%, Nevada 12.0%, Oregon 12.2%, Ohio 11.1%, North Carolina 11.0%, South Carolina 12.1%, Kentucky 10.9%, Tennessee 10.8%, and Indiana 10.7%. Over 100 urban areas now have unemployment rates over 10%.
Adult male unemployment nationwide is already in double digits at 10%. Black unemployment is 14.7%, with Hispanics at 12.2%. Teenage unemployment is 24%, with black teenage unemployment close to 40%.
In a shocking article in the Wall Street Journal on July 14, Mortimer Zuckerman, chairman of U.S. News and World Report, explained why the economy is even worse than these numbers indicate. At least another 1.4 million people have already given up looking for work and so are not counted in the official unemployment rate. Another 9 million workers have taken part time unemployment because they cannot find full employment, yet they are not counted in the unemployment rate because they have some employment. Zuckerman reports:
The average work week for rank-and-file employees in the private sector, roughly 80% of the work force, slipped to 33 hours. That’s 48 minutes a week less than before the recession began, the lowest level since the government began tracking such data 45 years ago.
Zuckerman suggests that adding those whose hours have been cut to those who cannot find a full time job would leave the real unemployment rate at 16.5%. He adds:
The average length of official unemployment increased to 24.5 weeks, the longest since government began tracking this data in 1948. The number of long-term unemployed (i.e., for 27 weeks or more) has now jumped to 4.4 million, an all-time high.
Because of all this burgeoning unemployment and underemployment, incomes across the board are now declining.
Why Obama Failed
Don’t believe the Obama Administration rhetoric about how this economy has just turned out to be so difficult and they are doing the best they can. While the economy is still getting worse, the truth is the recovery is long overdue. The National Bureau of Economic Research dates this recession as starting some time during December, 2007. The longest recession since World War II was 16 months, with the average being 10 months. The current recession has now lasted 19 months. By this reckoning, we should have had a normal cyclical recovery at least 3 months ago.
When President Obama was hawking his stimulus package costing the American people close to $1 trillion with interest, he told us that it would prevent the unemployment rate from rising above 8%. If we didn’t pass it, he said, unemployment would go to 9%. He and his Administration savants also promised that the stimulus package would go to work reviving the economy immediately. As Fred Barnes wrote in the Wall Street Journal on Monday,
Once the stimulus passed, Democrats said the impact would be practically instant. House Majority Leader Steny Hoyer (D-Md.) predicted “an immediate jolt.” Economic adviser Larry Summers said, “You’ll see the effects almost immediately.” White House Budget Director Peter Orszag said it would “take only weeks or months” to be felt.
Obviously, President Obama and his economic gurus didn’t know what they were talking about. Not only is unemployment today at 9.5%, but even the Obama Administration is now saying it will go over 10%. President Obama is now changing his story, saying the stimulus was never supposed to work this fast, and it is really a two-year program. But if the economic was in such tragic shape when he came into office, why didn’t he develop an economic program that would work faster?
President Obama also told us when seeking approval for his stimulus that it would create or save 3 to 4 million jobs. But America has already lost 7.2 million jobs from this recession, so President Obama spent close to a trillion taxpayer dollars on his stimulus to do half the job, even if it worked as planned. Since January when President Obama entered office, America has lost over 2.6 million jobs. So the stimulus as yet is not working as planned.
Indeed, it was obvious from the beginning that the stimulus as designed was going to create or save exactly zero jobs, because it was based entirely on old-fashioned, throwback, Keynesian economics, proven not to work over and over. The stimulus package involves just borrowing a trillion dollars from the private economy to increase government spending in the economy by a trillion dollars. That involves no net increase for the economy in any event. In fact, it involves a net loss at best, because the private sector spends the money more productively and efficiently than the government.
Moreover, this Keynesian borrowing and spending does nothing to change the basic incentives that govern the economy. Indeed, nothing anywhere in Obama’s entire economic package increases incentives for economic growth, or for investment in particular.
A man of faith in a godless age is hitting Americans where it hurts.
Mr. and Mrs. American Spectator Reader, let P.J. O’Rourke talk sense to your kids.
In Britain, defending your property can get you life.
The debacle of this president’s administration is both a cause and a symptom of the decline of American values. Unless Congress impeaches him, that decline will go on unchecked. An eminent jurist surveys the damage and assesses the chances for the recovery of our culture.
It won’t take long for conservatives to scratch this presidential wannabe off their 2008 scorecard.
The American Christmas, like the songs that celebrate it, makes room for everybody under the rainbow. Is that why so many people seem to be hostile to it?
Was the President done in by the economy, or by the politics of the economy?