Free Markets, Free People

8.3% (updated)

Interesting, isn’t it?  I really don’t have to put anything else up there to explain that number.  Everyone in their brother will look at it and understand that the unemployment rate just rose from 8.2% to 8.3%.  Its sort of like celebrities who are identifiable by only their first name.  However, Obama and the Democrats certainly don’t want to grant that number that sort of status.

The U.S. economy closed out an otherwise weak second quarter by creating more jobs than expected, with 163,000 new positions added, but the unemployment rate rose to 8.3 percent.

Of course the job creation rate isn’t even at the break even point, even if up slightly.

But that doesn’t mean there aren’t those out there spinning the results:

"While the monthly gain is still relatively small by historical standards, it might help spark somewhat higher consumer optimism and spending," Kathy Bostjancic, director of macroeconomic analysis at The Conference Board, said in response to the report.

Yeah, “spark.”  Like all the other “sparks” we’ve been told about.  Like the 3 “recovery summers” we’ve been promised.  Like the job saves/creation the stimulus was going to provide (Remember we’re supposed to be at around 5% unemployment right now.  That’s what Obama promised if we gave him a trillion dollars to throw down the sewer.  He claimed that without it unemployment would rise to … oh, wait, over 8%).  And this month we’ve seen the official unemployment rate go a tenth higher.

As for the spin, let’s get real instead:

Despite the seemingly good news, the report’s household showed that the actual amount of Americans working dropped by 195,000, with the net job gain resulting primarily from seasonal adjustments in the establishment survey. The birth-death model, which approximates net job growth from newly added or closed businesses, added 52,000 to the total.

The household survey also showed 150,000 fewer Americans in the workforce.

Perking right along, aren’t we?  Oh, and by the way:

June’s anemic 80,000 gain was revised down to just 64,000.

And does the 8.3% number really reflect the problem?  Well, we’ve said for years that it understates it. And it does:

While the figures themselves have been gloomy enough, there is considerable debate over whether the Labor Department’s headline numbers present the true picture.

A measure that takes into account those who have stopped looking for jobs as well as those working part-time for economic reasons has hovered near 15 percent. The so-called "real" unemployment rate, or U-6 measure, is above 20 percent in Nevada and California.

On a national level, that more encompassing rate edged higher to 15.0 percent.

But if you listen to Obama he’ll tell you that what he’s done “worked”.  Then he’ll try to convince you it would be much worse if it hadn’t “worked”.  Really?

If you honestly believe that, then you have a convenient memory that has obviously forgotten all the promises made about the stimulus spending.

None of what he and his administration has done has worked, we’re in horrible economic shape, he’s had 3 plus years to do something that would help the situation (just one example is the oil and gas industry where approving Keystone and opening federal lands and the offshore to exploration would have crated thousands of jobs), and he’s failed.

Time to give someone else a shot.

And yes, it’s that simple.

UPDATE: Zero Hedge chimes in – basically the numbers aren’t as good as they’re being spun:

We got the pre-spun job quantity data already, where we learned that nearly 3 times the headline print was due to seasonal and B/D adjustments and is thus nothing but noise. Now we get the quality. As can be seen below, courtesy of Table A9 from the Household Survey, in July the number of part-time jobs added was 31K, bringing the total to 27,925, just shy of the all time record of 28,038. Full time jobs? Down 228,000 to 114,345, lower than the February full-time jobs print of 114,408. Once again, more and more Americans are relinquishing any and all benefits associated with Full Time Jobs benefits, and instead are agreeing on a job. Any job. Even if it means working just 1 hour a week. For the BLS it doesn’t matter – 1 hour of work a week still qualifies you as a Part-Time worker.

UPDATE II: Meanwhile at the White House, unicorns and moon ponies continue to prance.  Alan Kreuger:

While there is more work that remains to be done, today’s employment report provides further evidence that the U.S. economy is continuing to recover from the worst downturn since the Great Depression.

UPDATE III: In case you need a reminder of “The Promise and The Reality”:





Twitter: @McQandO

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28 Responses to 8.3% (updated)

  • “June’s anemic 80,000 gain was revised down to just 64,000.”
    that’s been the game now for 3 years – publish a number you can barely get away with that’s not even ‘good’, but isn’t horrible, and then revise it to horrible reality 2-3 months later when no one is looking.

  • Our plan worked…

    Which makes you wonder, “Which plan?”  And, “It worked to do what?”
    GM profits down 41% over the same quarter last year.
    Central planning does not work.  Market economies work.  This is a “known”.  So why has Obama imposed a planned economy on the US?

  • I expect history will remind us how glorious was the reign of Imperator Obama and how all his work and plans were destroyed by the racist whites and the fascist members of the Tea Party before his most excellent plans could come to fruition.   They will lament, if only he had been given more time, if only the Republicans had worked with him instead of thwarting him at every turn, and tell us Romney benefited from his wisdom.
    Kinda like the way they remember the Reagan years, only, with more lies and racism thrown in.

  • “The U.S. economy closed out an otherwise weak second quarter by creating more jobs than expected”
    And that was an illusion.
    What is really unexpected is Obama’s approval and job performance ratings.  President Clueless – doing what he can to transform America.

  • As long as it’s profitable for our unpatriotic businesses to send our jobs to authoritarian capitalist countries like communist China and Vietnam, it will continue to be difficult to regain full employment.

    • You are right and O is for Outsourcing.

    • Sent from my iPhone.
      Signed, Tad the Idiot

    • So, tell us Tad, were you for Senator John Kerry’s Reappoachment effort with Vietnam before you were against it back in 2004?

    • “unpatriotic”?
      Tut, tut. Didn’t you get the memo? Calling people unpatriotic is a right-wing fascist slander. Get with the program.

    • Like those ungrateful unpatriotic companies like General Motors!

    • Ya didn’t like GM as an example Tad?
      Okay, how about the automaker Fisker?
      Yessir, not just jobs, but genuine US taxpayer collected money sent to Finland to help their unemployment.
      Any stray thoughts there Mr. Rocket Science?

    • A person so ignorant as to not understand basic economics and why we are much better off with foreign trade than with tariffs should not be commenting on the internet, thus displaying his childlike lack of knowledge.

    • Let’s assume your assertion is true.  Who sets the business climate in which it is either profitable or not to do this?
      Take your time.  I know thought is alien to you.

  • ZeroHedge also points out:  “But wait, there’s more: the Birth Death adjustment, which adds to the NSA Print to get to the final number, was +52k. How does this compare to July 2011? It is about 1000% higher: the last B/D adjustment was a tiny +5K! In other words, of the 163,000 jobs “added”, 429,000 was based on purely statistical fudging.”

    • Part of the mystery of the [f]unemployment rate is that the BLS has this fudge factor called the “Net Birth/Death Model” that estimates the number of jobs that small businesses are creating/destroying to make up for the slow rate at which this sort of data comes into the BLS.
      They supposedly changed the “resync” period on the B/D last year from every January to every 3 months so this should come around to bite them at the most inappropriate moment.

  • The Obamunists are still going to do what they have to to try to win the election. If I had to place a bet today, I think he loses. I thought that a last stab at spending leftover “Stimulus” money, favors granted, and statistical manipulations would paint a rosier picture of the economy. Surprisingly, they haven’t been able to do it. There does, however, seem to be an alternative plan in the works in case he loses, which is to move to the Left and re-enthrall the base. Because if he loses, he’ll be back in 2016. He will not simply go away. I believe that if Obama loses, a boom will begin the next day. Investors will get off their money and get into the economy in a big way. I think it will be a big boom, but that it will peak out and level off or decline in two years, because longer term problems, many of them created or exacerbated by Obama, will still be affecting the fundamentals. What will happen is that Obama will take credit for the boom, saying Romney hadn’t done anything when it began and that it was his, Obama’s policies, that finally bore fruit. The truth will be that the boom starts *because* he loses and is gone. But as the boom cools off or even fizzles, then Obama will say that that is now the result of Romney’s policies. So, if he loses, I predict he will be back in 2016 and that is how he will play it.

    • Ah, I don’t think the true First Black American President will permit a return, his wife will have been out of work for 4 years by 2016.

      • Unfortunately, the same rules will apply in 2016: If black voters want Obama they will have him. The hold the keys to the Democratic kingdom. If they had waken up the last four years, and his support among blacks dropped down to even 70 percent, the election would be over. I don’t see them ever deserting him because they stubbornly cling to the idea that he’s a heroic moment in their history in this country, and they’ll see him through this election, and if wants to come back in four years, under a scenario like the one I outlined, they will make it so. I think it’s pathetic, but such is the power of symbols.

        • He’s a horrendous role model, is what he is.  They’d be better off creating a Manchurian Cliff Huxtable.   But Cliff would do something insane, like tell them work hard, study, get ahead…

          • I keep having this reoccurring dream that this is life imitating art.  Obama is “Dave“.
            The TOTUS, the 4 times to send a UBL raiding party, the decision made “alone.”  It’s all there.

      • Sorry for the typos there. WTF happened to the edit feature?

    • I think the same way you do, there is a lot of money on the sidelines just waiting it out. The election of a moderate Republican with business experience will trigger a lot of growth.

      • The few days after the election (that pours out Obama) will be like…dare we say it?…morning in America.

  • Some of us have been using the “D” word for about two years. Cause, man, just thinking about a full-fledged depression that would let wise leftists go wild like they did in the thirties gets my panties wet.

    The thing is, structural imbalances have been building for thirty years. That date is no accident of course, since it’s all Reagan’s fault. If we had just stuck with the wonderful Jimmy Carter, things would have been much better.

    Yep, de-regulation has yielded a down right destructive financial sector. Which has nothing to do with powerful politicians bailing out their buddies in exchange for campaign cash. And don’t start up with the whole Fannie Mae affordable housing Barney Frank stuff as a major cause. Just don’t start. He’s a smart, wise leftist who just wanted what was best for everybody. No, government most certainly DID NOT cause the housing meltdown. I decree it. If you think otherwise, you doth protest too much. LOL {eyes rolling}

    The crisis is global and will take at least another five years to work through. Britain tried to let the depression run its course in the 30s and it didn’t work. No, I don’t have to supply links for that, so stop asking. I saw it in a book by one of my leftie social science buddies somewhere, or maybe it was in a Krugman column, I forget. But it stuck in my mind, because it rings true. – markets don’t magically recover, depressions can spiral downward and stick. I’m telling you, I decree it. So shut up about how the depression was made worse by Roosevelt and his brilliant lefty associates. Just shut up, shut up, shut up. It can’t have been that way. Their intentions were too good.

    People with blind faith that markets always work well are living in an ideological fantasy land, so enthralled by theory that they ignore practical reality. And we wise, pragmatic, moderate leftist social science academics teaching in third-rate colleges surrounded by moose herds are certainly not detached from reality and living in our own ideological groupthink in the faculty lounge about government can always solve everything. Nope. I hardly ever go there. Don’t need to. I know we all pretty much agree on everything.

    I suggest “The Myth of the Free Market” by Mark Martinez. Don’t pay any attention to the fact that it’s three years old and has already sunk to #952,579 on Amazon’s list, or that it isn’t even important enough to get more than a few cursory reviews that are probably from the author’s friends. No, I tell you, it’s an important book, and it explains why markets don’t adjust themselves, there’s no reason to believe they do.

    Free marketeers tend to think they understand the economy because they know the basics of theory, but they miss all the ways in which reality undermines how the theory works in the real world. Whereas wise leftism certainly works in the real world, so don’t you dare bring up the dozens of times it’s failed. They were different. The wrong people were in charge.

    Yes, markets are very good and necessary. But they really, really, really, really need the state, they need regulation, and they need rule of law as wielded by wise leftists who have everyone’s best interests in mind. Because we’re smart and have advanced degrees and all. Whereas you free market fools are mostly grunt engineer types who think you know everything just because you made A’s in math. Really, math is so depressing, and it’s so much more important to have rarefied sensitivities to the needs of other people. I pity you rightie ideologues, I really do.

    Because I’m so much more informed that you, and understand the world so much better, from here in my office where things are just untidy enough to make me look like a devil may care roguish sort of academic who jets off once a year to Italy. But not too untidy. Because then the magenta caterpillars with Sarah Palin’s face, naughty librarian glasses, and ample bosom start growing in the mess, and it takes a lot of work and about two weeks worth of blue pills to get them cleaned out.

  • Thank God Obama’s policies have worked. As bad as it is now, can’t you just imagine how bad it would have been if he hadn’t thrown that trillion dollars down the drain?