Free Markets, Free People

Unemployment Reaches 9.8%

While unemployment continue to climb at numbers higher than experts expected, and signaling the so-called “stimulus” isn’t working despite claims to the contrary, it seems the only program the president can come up with to boost employment is shilling for the Chicago Olympics.

Meanwhile here in the real world:

U.S. employers cut a deeper-than-expected 263,000 jobs in September, lifting the unemployment rate to 9.8 percent, according to a government report on Friday that fueled fears the weak labor market could undermine economic recovery.

Ya think? And, of course, as Dale has pointed out, if we calculated unemployment as we did in the past, the true number would be somewhere in the 16-17% area. Even the one area that was showing growth – government employment – is shedding jobs. 53,000 in this last reporting period.

This has even Paul Krugman upset:

[T]he administration’s own economic projection — a projection that takes into account the extra jobs the administration says its policies will create — is that the unemployment rate, which was below 5 percent just two years ago, will average 9.8 percent in 2010, 8.6 percent in 2011, and 7.7 percent in 2012.

This should not be considered an acceptable outlook. For one thing, it implies an enormous amount of suffering over the next few years. Moreover, unemployment that remains that high, that long, will cast long shadows over America’s future.

Krugman’s solution is as predictable as Iran stalling the P5+1 until it has a nuclear weapon – more spending. Specifically a 2nd stimulus. But weren’t we all assured that the first stimulus would stem the tide of unemployment and keep it under 8%? So Krugman’s plan has us repeat what hasn’t worked to this point. No talk of cutting corporate income taxes to spur hiring, in fact no talk of any other method which might actually spur the market instead of providing temporary spending for temporary jobs.

Or, more succinctly, they haven’t a clue and while Rome burns, Nero is in Copenhagen fiddling away.



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10 Responses to Unemployment Reaches 9.8%

  • I conclude that the Democrats don’t really value growth and employment to any signficant extent. If they did, there are a bunch of things they could do right now that would cost little or nothing to implement, but would have a substantial contribution to economic growth:

    – Repeal Sarbanes-Oxley, or at least make compliance voluntary

    – Repeal the ADA, or at least make compliance voluntary

    – Throw away the tax code and replace it with something vastly simpler (some estimates say close to half a trillion dollars a year is spent in tax preparation and compliance)

    – Redirect all government subsidies to debt reduction and/or tax reduction: crop subsidies, corporate welfare of all forms, art subsidies, etc.

    – Legalize and tax marijuana (I’d back the same for other drugs, but I know that’s not politically possible, while I think it’s not outlandish to do it for marijuana)

    I’m sure there are plenty of other items QandO readers could add to the list.

    But the Democrats will not do any of these things, and therein is demonstrated that their real objective is not economic growth or prosperity. It is political control of the economy and promotion of economic redistribution. That, ladies and gentlemen, is a compact definition of socialism, despite the wailing of various leftists who do not wish to be tagged with that label.

    • All of the above, and repeal mark to market accounting.

    • While I’m not opposed to legalizing marijuana, I doubt taxes from it would be very great. How do you tax something that’s so easily grown by individuals? It would be akin to putting a $1/ear tax on corn: pretty soon everyone with a backyard would be growing their own corn. And, unlike corn, marijuana can be grown indoors.

      So, while it makes sense to legalize marijuana from a libertarian/freedom/small government view, the economic effect of doing so would be very small.

      • If it were cheap and legal who would go through the trouble of growing it? do many people grow their own tobacco?

  • Possible Krugman motivations. He:

    1. Sees an excuse for the democrats to spend more money and is going after it like a trout going after a fly because he genuinely believes that more government spending is the only way to fix our economy;

    2. Is trying to protect his credentials as an economist (as opposed to an idiot liberal shill) by admitting the obvious: that liberal economic policies might be a teensy-weensy bit less than totally effective;

    3. Is slowly bringing himself to the realization that liberal economic policies are akin to killing the goose that lays the golden egg; libs can only raid the US economy so much before they kill it and completely dry up the money train they’ve been using to fund their schemes.

    Take your pick.

  • Go watch Charlie Gibson explain why this rate of unemployment is sorta okay, and surely is just the lull before the great economy swoops in.

    As opposed to young Charlie Gibson explaining in 1982 why when the numbers were the same under some guy named Reagan it was nearly criminal.

    Hope, Change!
    mmm mmm mmm Pelosi Reid Obama.

  • Krugman has been calling for a second stimulus for a while now. He never bothers to explain how it will fit into the deficit projections.

    It seems the Obama and the Democrats shot their stimulus wad the first time. If they decided to use the first stimulus to pay off political cronies, well, they need to explain that as the reason it didn’t work. Even if they were to promise to do better on the next stimulus, who would believe them?


    • Rick CairdEven if they were to promise to do better on the next stimulus, who would believe them?

      Just spit-balling here, but how about:

      The dimwits who were stupid enough to believe them the first time?

      Which is to say, the democrats in Congress, most of the “journalists” (snort!) who work for MiniTru, union goons, government workers, ACORN thugs, voters who self-identify as democrats, the mentally feeble (BIRM), etc, etc.