Free Markets, Free People

Daily Archives: July 15, 2010

Dale’s Observations For 2010-07-15

DISCLOSE bill has passed the Senate. Just a little less liberty in"the home of the free". #

.@dmataconis @jaseliberty @beckychr007: 2. Multiple-party government trends to be unstable. See Italy, and 60 governments since WWII. #

.@dmataconis @jaseliberty @beckychr007: 1. The Constitutional structure of the US government makes more than 2 parties…problematic. #

Gallup says economic pessimism is on the rise, as consumer confidence drops to its level 15 months ago. http://bit.ly/c4iwsq #RecoverySummer #

Gallup says economic pessimism is on the rise, as consumer confidence drops to its lowest level in 15 months. http://bit.ly/c4iwsq #

.@jaseliberty @beckychr007: Re "the two party legal monopoly"| I'm not sure what you mean by this. What laws require 2 parties? #

Mortgage applications sink to a 13-year low, while foreclosures rise. http://bit.ly/9hm991 #RecoverySummer #

The big honkin' Droid X Android phone, with its 4.5 inch screen, goes on sale today. To Verizon customers, anyway. http://bit.ly/bx93Xw #

BP Says Cap Is Repaired and Oil Cutoff Test Can Proceed. http://bit.ly/adjSrp #

Initial jobless claims dropped today, but seasonal factors may be giving us a misleading view. http://usat.me?39284834 #

Well, the dogs have ripped thecable hookup to the outside of the house apart. That's just the end to a perfect day. #

Yummy! http://twitpic.com/25cls3 #

"Recovery Summer" is a big "no sale"

Gallup’s latest poll brings us back to reality:

Gallup Daily tracking finds Americans’ confidence in the economy significantly lower so far in July than in June. And confidence in June was, in turn, down from May. The Gallup Economic Confidence Index for July 1-13, at -35, is lower than any monthly average in more than a year.

Recovery summer isn’t off to a very blazing start.  If the administration and its spinmeisters think they’re selling the recovery, they need to “reset” their calculation:

The decline in confidence seen in recent months is owing primarily to mounting public skepticism with the economy’s direction. Thus far in July, 30% of Americans, on average, have said the economy is getting better and 65% have said it is getting worse, for a net -35 economic outlook score. This is down sharply from -13 in April.

Economic confidence is a critical key to any recovery.  Once consumers are sold on the economy’s recovery, positive growth is usually the result.  The opposite is also true.  That’s because consumers who have lost confidence in the economy are more likely to put off buying anything but necessities.  The obvious economic repercussions of that sort of thinking is to slow growth and thus delay (or kill) any recovery. 

The political problem here (I think the economic problems should be obvious to all) is that the confidence of the consumer in the economy is heading down while all the spin is telling us we’re recovering quite well, thank you very much.

In other words, the political sales job on the economy and recover – critical to Democrats going into the mid-term elections – isn’t taking.  Consumers hear the pitch, look around them and not seeing what is said to exist, are rejecting it for the reality they are seeing and living.

Bad mojo for Dems looking at an election in 4 months.  That’s has caused all sorts of inter-party whining, wailing and fighting.  Meanwhile companies do what companies do when they lack confidence in the economy (and the policies of the government) – nothing.

Economically, without a true miracle, things will not begin to turn around sufficiently in the economy to be of any help to Democrats in November.  It appears it isn’t a question of whether or not they’ll lose seats, it is a question of how many.   With the numbers we’re seeing in various polls about how the electorate views the Democratic Congress and Obama administration’s economic policies, it’s clear that most have decided that giving the GOP another chance is the least of their bad choices for this coming election. 

Whether that has much of any impact, given the demonstrated obstinate nature of this administration, in the new Congress (and assuming they take control of at least on house in Congress) remains to be seen.  But if the Republicans take the House, the great blame-shifter in the White House will have a new entity on which to blame any continued economic failure.

Or, shorter for the GOP, be careful of what you wish for.

~McQ

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Beware of the new Obama job creation claims

T

he NY Post reminds us that the Joe Biden/Christina Romer dog-and-pony show now currently touring and touting some amazing "magical" job creation numbers are the same crew that gave us other estimates of job creation in the past:

Last year, when they touted their jobs figures, they wound up backtracking — after it turned out that hundreds of jobs were included from congressional districts that didn’t even exist.

Biden later admitted the data were flawed, noting that "further updates and corrections are going to be needed."

Then he and Obama bragged about new job numbers for May — some 430,000 of them. Except that 411,000 were temporary, part-time positions created by the Census Bureau.

Now the claim is that somehow, despite the unemployment numbers, they’ve managed to “create” or “save” anywhere from 2.5 million to 3.6 million jobs with their excellent management of the financial and economic crisis.

Of course no one can put a finger on what jobs were “created” or, really, what jobs were “saved.”  Says Romer, apparently trying desperately to keep some shred of professional integrity in tact:

"There’s obviously a lot of uncertainty about any jobs estimate," Romer acknowledged.

Really?  That’s certainly true of the estimates this administration has put forth.  However, as the Post points out, the timing of this estimate is perfect.  This estimate shows an increase of 20% over the last estimate that was found to be based in fraudulent numbers.  As the Post notes, this estimate arrives just as Obama’s poll numbers are down.

All that anyone really needs to know is that this all started within the administration when it promised that the massive pork bill of nearly a trillion dollars it passed early in its tenure would keep the unemployment rate under 8%.  It didn’t.  In fact it didn’t even come close.  And the figure is now around 9.5% and shows no indication of falling anytime soon.  Where these magic jobs are and why they haven’t had any impact remains a mystery.

Of course the entire point is to understand that they can (and are) claim whatever they wish and it’s pretty hard to check.  But skeptics, like myself, aren’t going to be convinced by mere claims.  Hard numbers that can be checked and verified will have to follow.  And it is my contention that when they do, we’ll see a repeat of the previous two attempts at pulling the wool over the eyes of the America people for political reasons – something this administration shamelessly attempts pretty consistently on a number of fronts.

~McQ

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