Free Markets, Free People
I see that Megan McCardle thinks the unemployment numbers released today are enough to make her make her “cautiously optimistic” about the jobs picture. I’ll meet her halfway. I see room for caution, but not yet for optimism.
Ms. McArdle writes:
It’s very solidly good news: the labor force participation rate was basically unchanged, which means we’re seeing an actual decline in the unemployment rate, not a spike in the number of people leaving the labor force because they can’t find a job.
My reading of the numbers is precisely the opposite. It appears to me that teenagers, high school dropouts, and those with only a high school diploma, all of whom have high unemployment rates, did, in fact, drop out of the labor force, which led to the decrease in the employment rate.
I also think the numbers are skewed by the seasonal adjustments. The BLS adjusts the figures for seasonal changes, with extra weighting given to more recent years. Last November, the Lehman collapse led to the loss of 610,000 jobs–the largest ever recorded by the BLS–so I suspect the weighting for seasonal factors is skewed to the point where the jobs situation may look better than it actually is.
We do see an increase in hours worked of 0.6 hours, but that doesn’t really create new jobs, it just provides more hours for current part-timers.
However, temporary employment rose significantly for the 4th straight month, and it appears that the mass layoffs have petered out.
So, as far as I can tell, there may have been a bottom, but there are still some anomalies that need to be explained before I jump into the optimist camp.
And, of course, none of this even touches on the 800-pound gorilla in the room, which is monetary policy. The Fed’s policy of quantitative easing, i.e. massive increases in the money supply, still present us with hundreds of billions of dollars in low-velocity money floating around, all of which will have to be absorbed through higher interest rates, or through significant inflation. The possibility still remains that necessary credit tightening will strangle any nascent recovery over the next 12-18 months, and send the economy on a another downward leg.
I spoke with Tom Campbell for over 45 minutes on a range of topics, and I’ve split my posts on that discussion into two posts, one here and one over at The Next Right. Here at QandO, I’m going to cover the more policy-oriented topics, and over at The Next Right the topics have to do with new media, elections, and the politics of fiscal conservative governance.
It pains me to see my native California in such dire straits. The state is broke, farms are collapsing, and unemployment is over 12 percent. The public colleges that might help retrain a lot of those workers are slashing classes.
The tax and regulatory burden has finally overcome the state’s many natural advantages, leading its citizens to abandon the Golden State. And these are people who can’t be having an easy time selling their homes: California, one of the first to suffer in the real estate collapse, is still near the top of the heap in foreclosures.
California, as we say, has issues. I talked with Tom Campbell about some of the most important ones: the budget deficit, jobs, health care, education, water and infrastructure.
Except it really doesn’t. In fact, among those 7,000 “additional” troops promised are 1,500 which are already in country and the 500 the British had already promised. So it’s 5,000 additional troops in reality. Nothing to sneeze at but certainly not the 10,000 desired. As expected many will come from former Eastern bloc nations:
1,000 from Poland; 600 from Italy, plus more Carabinieri to work with Afghan police (something which worked well in Iraq – ed.). Slovakia is sending a small deployment …
Non NATO nations are sending detachments as well – South Korea is sending a small one and a surprisingly large one of about 1,000 is coming from Georgia.
An undisclosed number of the new troops will steer clear of the fighting because they are barred by their countries from combat operations. And two allies, the Netherlands and Canada, still plan to withdraw nearly 5,000 troops in the next two years, offsetting the infusion.
But it sounds great on paper, doesn’t it?
By that I mean the Congress of the United States. It can find more ways and more reasons to reward rent seekers than perhaps any legislative body I know. That’s probably because it has the largest budget of purloined confiscated taxed dollars in the world. And even when it has none, it still manages to hand out borrowed dollars. In fact, we’re now to the stage that it involves generational theft – running up a debt that will have to be paid back by those not even born yet. Imagine emerging from the womb with about $38,000 in debt already hanging over your head. That’s the current charge. Of course there’s always next year, when, as you know, the fed plans on spending another trillion we don’t have. So in the big scheme of things, this story may almost seem trivial. But it is indicative of how “special interest” democracy rewards rent seekers and finds new ways to loot the economy that simply boggle the mind.
Call this one “too special to fail”:
The radio business has nothing to do with the plan to overhaul the nation’s system for regulating banks and other financial institutions.
Except, it turns out, in Congress.
One of most intriguing mysteries here in recent weeks is why members of the Congressional Black Caucus have chosen to buck their party and president in trying to stall financial regulation reform.
The answer lies at least in part with an aggressive lobbying campaign by a troubled New York City-based radio broadcasting company, Inner City Broadcasting, whose co-founder is a prominent New York politician and businessman, Percy Sutton.
In a rare break with President Obama, the caucus, made up of black members of Congress, is holding back support for the legislation because it wants the administration to help minority-owned businesses, including Inner City, whose financial plight has been specifically identified in meetings with top administration officials.
In a variation on “no justice, no peace”, the CBC has a new slogan: “No loot, no vote” (and trust me, they’re only one of many doing this all the time, from both sides of the isle, in Congress).
Inner City Broadcasting has enlisted the CBC to plead its special case. It apparently has a bad business model that has failed and it insists its specialness exempts it from the results of that – after all, it is a minority owned business, don’t you know.
And that means it wants an exemption from failure. The story:
Inner City Broadcasting, which owns 17 commercial stations nationwide and was co-founded in 1971 by Mr. Sutton, faces a possible financial collapse because of pressure by Goldman Sachs and GE Capital to repay nearly $230 million in debt, Pierre Sutton, his son, said in an interview Wednesday.
Inner City has been battered by declines in advertising, as have many stations around the country, which have experienced drops of 10 percent or more in the last year because of the recession and the move of advertisers to the Internet.
But the other stations don’t have a friendly caucus in Congress do they? And that caucus knows its party owes it some loot to remain on their side. Their refusal to vote for more financial regulation is simply a little exercise in reminding their party of that.
Members of the caucus asked the administration to squeeze lenders like GE Capital and Goldman Sachs to renegotiate their loans with Inner City and other black-owned radio stations, arguing that these financial institutions themselves had already received federal assistance. Some caucus members even pushed to include black-owned radio stations in the bailout.
“There is a lot of concern about Inner City Broadcasting,” said Barney Frank, Democrat of Massachusetts, the chairman of the House Financial Services Committee, who set up one recent meeting with Mr. Geithner and Mr. Emanuel at the request of the Black Caucus.
Mr. Frank said the radio stations were only one issue raised by the caucus, and that others included financial difficulties faced by black-owned auto dealers, newspapers, banks and government contractors.
Yes, friends, it’s only fair. Extortion, influence peddling and payoffs (like 300 million for LA if a certain Democratic Senator votes for health care) are illegal everywhere but the US Congress where they’re business as usual — you know, the most ethical Congress ever?
And they wonder why they enjoy so little of the American people’s confidence and respect.
So you’re a “journalist” and you have the opportunity to interview Al Gore prior to the Copenhagen climate summit. The scandal surrounding the University of East Anglia’s CRU has been breaking for two weeks and its head, Phil Jones has stepped down. Penn State University is investigating Michael Mann and his discredited “hockey stick”. It even appears that NASA may have been in on the scandal having spent 2 years avoiding FOIA requests. And all of it undermines the very foundation of the science of man-made global warming Gore has based his assertions upon.
Do you think, as journalists, that might be something you’d want to question the man who has almost made a religion out of the cause based on this data?
Yeah, I’d think so too. But apparently John Harris and Mike Allen of Politico didn’t think that was important enough to ask Mr. Gore. Unless, of course, they just didn’t include it in their “published excerpts”. But then I can’t think of a single reason, given the depth and breadth of the scandal, that they wouldn’t can you?
Well, they didn’t.
John Coleman tells you why.
According to Rasumssen, when it come to the topic global warming a majority of Americans don’t believe that to be true:
Most Americans (52%) believe that there continues to be significant disagreement within the scientific community over global warming.
While many advocates of aggressive policy responses to global warming say a consensus exists, the latest Rasmussen Reports national telephone survey finds that just 25% of adults think most scientists agree on the topic. Twenty-three percent (23%) are not sure.
That, of course, is a direct refutation of a statement by presidential spokesman Robert Gibbs:
“I don’t think … [global warming] is quite, frankly, among most people, in dispute anymore.”
Additionally, the majority of Americans are skeptical of the efficacy of climate scientist’s data – and this is not a result of Climaquiddick:
Fifty-nine percent (59%) of Americans say it’s at least somewhat likely that some scientists have falsified research data to support their own theories and beliefs about global warming. Thirty-five percent (35%) say it’s Very Likely. Just 26% say it’s not very or not at all likely that some scientists falsified data.
This skepticism does not appear to be the result of the recent disclosure of e-mails confirming such data falsification as part of the so-called “Climategate” scandal. Just 20% of Americans say they’ve followed news reports about those e-mails Very Closely, while another 29% have followed them Somewhat Closely.
It will be interesting to see what Climaquiddick does to those numbers, especially since the scandal seems to have spread to NASA here.
Rasmussen’s poll contradicts the myths of scientific consensus or “settled science”. Additionally, it points out that not only are the majority of Americans skeptical of the science, but given the recent scandal, that percentage is likely to grow.
Meanwhile, James Delingpole updates us on the latest and greatest concerning Climaquiddick.