Free Markets, Free People

Daily Archives: July 2, 2010


Dale’s Observations For 2010-07-02

CA Appeals Court: The governor may lower state workers' pay to the minimum wage if a state budget isn't in place. http://bit.ly/b3sk99 #

HCR may mean longer emergency room waits and more crowding. Unexpectedly! http://usat.me?39117590 #

RT @LeftCrusader: The Bureau of Labor Statistics reports that non-farm jobs fell from 133,549k in Jan09 to 130,470k today. That's -3.079m. #

RT @LeftCrusader: The 3 million jobs lost is a complete bullshit talking point by fixed news. | Its the official BLS non-farm employm't no. #

RT @LeftCrusader: @DaleFranks CLinton creatd 20 m and Carter created 10m n 1 term. | Under Reagan, 17.7m jobs were created. So do I win? #

RT @LeftCrusader: Bush creatd just over a million [jobs] n 8 years. | And 3m+ jobs have disappeared in 18 months of Obama. #

RT @LeftCrusader: @DaleFranks CLinton creatd 20 m and Carter created 10m n 1 term. | *shrug* That's irrelevant to your claim about Obama. #

RT @LeftCrusader, re: Obama creating jobs v. Bush. BLS payroll employment: 2001-2009, +1.86m jobs. Since 2009, -3.079 jobs. Ur math sucks. #

Factory orders fall 1.4% in May after 9 months of gains http://usat.me?39114292 #RecoverySummer #

Official unemployment rates: Jun 09: 9.5%, Jun 10: 9.5%. Actual unemployment rates: Jun 09: 11.4%, Jun 10: 13.1% #

Isn't it interesting how, as unemployed people get discouraged and stop looking for work, the unemployment rate declines? That's by design. #

Using the historical labor force participation rate (66.2%), the actual unemployment rate is 13.1%, up from 12.8% last month. #

In June, 125k jobs lost, yet the unemploym't rate went DOWN to 9.5%, says the BLS. Unemploym't rate is really lowballed. #RecoverySummer #

Anderson Cooper: It's inconceivable that on Day 73 of the oil spill, we're still talking about getting skimmers to start working on the oil. #

The general opinion seems to be that the Feds are incompetent buffoons. #

Billy Nungesser, Plaqumines Parish President, says he's not asking the CG permission to do anything, and the Feds can suck it. #

Watching Anderson Cooper on CNN right now, tearing the Feds a new one for lack of transparency in the oil cleanup efforts. He seems PO'd. #

RT @AblativMeatshld: CA Welfare Recipients Withdraw $12k From Strip Club ATMs http://fxn.ws/d5s4EY" | Meh. I could do that by myself. #


Administration oil spill report requires a willing suspension of disbelief?

That’s what the GOP says.  For example:

Billy Nungesser, president of New Orleans’ Plaquemines Parish, sensed that a chart showing 140 oil skimmers at work — a chart given to him by BP and the Coast Guard — was “somewhat inaccurate.”

So, Nungesser asked to fly over the spill to verify the number. The flyover was cancelled three times before those officials admitted that just 31 of the 140 skimmers were actually deployed.

I guess some will be surprised by that.  But, in fact, the government is in the positive spin business when it comes to self-reporting on the job it is doing – for anything.  That’s why whenever something is announced or explained, skepticism – of the highest degree – should be exercised by the target audience.

In Nungesser’s case, he obviously knew that as ineffectual as the effort had been in his area, there couldn’t possibly be 140 skimmers deployed.  And, of course, he was right.

Rep Darrel Issa (R-CA) has become a bit of a thorn in the administration’s side over its response to the spill.  As ranking member of the House’s Committee on Oversight and Government Reform, he’s taken it upon himself to have the various administration claims investigated.  The result?  Not so hot:

Committee staff has discovered the following based upon witness interviews and documents provided by federal and state entities:

• Officials on the ground dispute key White House assertions about the number and timeliness of assets deployed in the Gulf. Local officials describe White House outreach efforts as more focused on stopping bad press than on addressing the disaster at hand;

• The White House’s assurances that there are adequate resources are at odds with the reality on the ground, where those on the frontline of the spill express significant frustration over the lack of assets. Local complaints are supported by the fact that the White House waited until Day 70 of the oil spill to accept critical offers of international assistance. Local workers and boats could have been assisting more with the clean-up if the Federal government had provided them with needed supplies and equipment;

• While the White House has tried to use the delay in finding a visible leak to explain its early silence on the oil spill, Transocean officials and Coast Guard documents from the scene of the oil spill reveal clear and early indications of a substantial oil leak days earlier than White House accounts;

• The failure of Administration officials to quickly waive laws preventing necessary foreign assets from reaching the Gulf and other regulations are hampering efforts to clean-up and limit damage from the oil spill. Local officials feel the federal government is making the perfect the enemy of the good in cleanup efforts;

• Local officials strongly dispute President Obama’s insistence that the federal government – and not BP – has been in control since day one. One Coast Guard Admiral told congressional investigators that decisions on the ground are made through a “consensus-based” process with BP. In practice, the Federal Government is not in charge of oil spill response efforts through a command-and-control approach;

• Local officials strongly believe the President’s call for a drilling moratorium will significantly compound the economic damage caused by the oil spill and will actually increase risk associated with future offshore drilling projects.

Shorter: The federal effort has not been nor is it now anything like what it has been cracked up to be by the administration’s spin.  In fact, it’s been pretty pitiful.

But I think Rear Adm.  Jim Watson probably says it best:

Rear Admiral Jim Watson, the senior-most official at the Unified Area Command in Robert, LA, also gave a different account of events on the ground. In a June 14, 2010, briefing to Chairman Towns, Ranking Member Issa, and staff, Watson stated that his command structure is decidedly different than what has been described by the White House. According to Watson, “It is not a war-fighting command and control structure where the Federal government is sending orders to BP. Rather the process on the ground with BP and others is “consensus-based,” where higher-raking officials inject themselves to resolve differences of opinion. In his view, “The framework probably isn’t up to the task.”

Ya think?!  Day 74 and still, no one is in charge. 

Where’s the freakin’ outrage? 

~McQ


Why isn’t Felipe Calderón running his mouth now?

Because he has no control over his own country, and it is much easier to shift the blame for his shortcomings and attack Arizona law as a distraction (much like someone else we know all too well):

A drug gang leader says he ordered the killing of a U.S. consulate worker because she gave visas to a rival gang in the border city of Ciudad Juarez, federal police said Friday.

Jesus Ernesto Chavez, whose arrest was announced on Friday, leads a band of hit men for a street gang tied to the Juarez cartel, said Ramon Pequeno, the head of anti-narcotics for the Federal Police.

Pequeno said Chavez ordered the March 13 attack that killed U.S. consulate employee Lesley Enriquez and her husband as they drove in the violent border city, and he said Chavez told police that Enriquez was targeted because she gave visas to a rival gang.

Enriquez’s 7 month old daughter was found alive in the back seat.  Of course I’d like to know what a drug gang member was doing getting a visa, but I’m sure we’ll never hear anything about that.

Last year, 2,600 people were killed in Juarez, a city of 1.3 million.  Just the other day 7 bullets hit the El Paso city hall.  Juarez is a virtual anarchy with fights between rival drug gangs and human trafficking gangs common.

It is here Calderon should be focusing his efforts – not worrying about the immigration laws of his neighbor.  Isn’t it about time for Obama to travel to Mexico city and address their legislature on what they should be doing to secure their border, lessen the threat to American citizens and enforce the law?

Yeah, that’ll happen.

I’m sure Calderon will tell us its our fault for using drugs and not letting anyone in the country who wants in.  And I’m just as sure that our President will agree.

~McQ


Unemployment numbers “unexpectedly” rise again? Really? Unexpectedly?

Unexpectedly for whom?

If anyone has been out and about in this economy, they don’t find the numbers “unexpected" at all:

Claims increased 13,000, to 472,000, while forecasters expected a slight drop to about 455,000 from the previous week’s seasonally adjusted 457,000, according to Labor Department figures released Thursday.

Not good.  The Hill tries to put lipstick on this pig:

The four-week moving average, which smoothes out the volatility of the weekly number and is a better look at the employment picture, increased 3,250, to 466,500, from the previous week’s revised average of 463,250, the highest in almost three months.

But the fact of the matter is 3,250 jobs in a month isn’t even a good statistical blip.  In order to see real job creation numbers, we have to be in the neighborhood of creating 250,000 jobs over the same period.  So  essentially we have a job deficit of about 700,000 at the moment.

“Economists” cited by The Hill apparently have a much lower target in mind:

Economists argue that jobless claims need to drop into the low 400,000s or high 300,000s to reflect stronger job growth in the private sector.

Again, that’s not “job growth” – that’s just smaller decline in job losses.  And that decline may have nothing to do with reflecting “job growth”.  Job “growth” would be on the positive side of these numbers. Until they are positive, we’re essentially replacing a lost job with a new job or just seeing fewer losses.  Job recovery, if you will, takes place between these numbers and about 120,000 to 140,000 jobs which is the maintenance level of the unemployment percentage.  IOW, if we’re putting on 120,000 to 140,000, we’re essentially treading water in the jobs area.  Only once we’re past those numbers on the positive side are jobs “growing” in number.

Anyway, these numbers aren’t unexpected and they certainly aren’t good news.

~McQ


Basic economic ignorance

If ever there was an indicator – an example – of the appalling level of economic ignorance to be found among our national legislators, this from Nancy Pelosi is perfect:

Talking to reporters, the House speaker was defending a jobless benefits extension against those who say it gives recipients little incentive to work. By her reasoning, those checks are helping give somebody a job. "It injects demand into the economy," Pelosi said, arguing that when families have money to spend it keeps the economy churning. "It creates jobs faster than almost any other initiative you can name."

Pelosi said the aid has the "double benefit" of helping those who lost their jobs and acting as a "job creator" on the side.

Demand is not created or "injected" by jobless benefits. At best may be, at some level, maintained. But it also could be argued that if the drop in income in an area is wide enough (former salary income v. jobless benefit income) it could cost jobs.

For instance the store clerk in a grocery store can be economically justified if the average grocery bill in the area is X. But if it falls to Y, which is likely with belt tightening by those receiving lesser unemployment benefits, then the clerk’s salary is no longer economically justifiable.

Jobless benefits rarely lend themselves to purchases outside the necessities because they’re usually not a great amount of money. The benefits are a maintenance income. What they mostly do is allow the recipient to pay for food, clothing, shelter and transportation, or some combination of those necessities.

Employers don’t create businesses and jobs in anticipation of receiving some of a person’s unemployment check. So unemployment checks are not out there creating jobs "faster than almost any other initiative you can name". In fact, their extension most likely inhibits job seeking (as the person and/or family adjust their lifestyle to the income until all necessities are covered).

This is an amazing example of the appalling economic ignorance that has gotten this country in the financial hole it is in and seems bound and determined to dig it deeper. And she’s 3 heartbeats away, folks.

~McQ

[MICHAEL ADDS:] The left has been pushing this idea for awhile. I tackled it back in January:

If you look closely at the chart you will be unsurprised to find that government spending is calculated to provide substantially more “bang for the buck” in creating wealth and jobs. That’s unsurprising because this chart is intended to support a progressive prescription for the economy. Of course it will show government as the answer.

Without arguing the statistical or modeling specifics behind the chart, there is one glaring item that reveals how much magical thinking went into its creation. By far the most “stimulating” actions set forth are “Temporary Increase in Food Stamps”(calculated to create 9,803,333 jobs), “Extending Unemployment Insurance” (9,236,667 jobs), and “Increased infrastructure Spending” (9,010,000 jobs). The closest tax-cutting measure, according to this analysis, in job creation is a “Payroll Tax Holiday” which is estimated to create 7,253,333 jobs. Do you see the problem?

How, exactly, do food stamps and unemployment benefits create jobs? Arguably, spending on infrastructure could create construction jobs on a temporary basis, although that hasn’t proven to be the case with the stimulus bill that was passed. But there is simply no logic to the idea that providing government benefits to the poor and unemployed will serve to create jobs, much less 9 to 10 million of them. That’s just magical thinking.

And again in February. Based on whatever studies they’ve compiled to prove their point, the Democrats are going to simply go with this economic model sans examination.


Voter enthusiasm higher for GOP voters

A party can have the greatest candidate in the world, or at least think so, but if voters who favor that candidate and party don’t get out and vote, even a Jimmy Carter can win.  This time around, if the polls are indicative of the voter’s true feelings, the enthusiasm gap is on the side of the GOP.  In fact, pollsters haven’t seen such a difference since 1994.  The Pew Research Center conducted a recent survey and found:

Fully 56% of Republican voters say they are more enthusiastic about voting this year than in previous elections – the highest percentage of GOP voters expressing increased enthusiasm about voting in midterms dating back to 1994. While enthusiasm among Democratic voters overall is on par with levels in 2006, fewer liberal Democrats say they are more enthusiastic about voting than did so four years ago (52% then, 37% today).

The other key, of course, is the final sentence.  And, if you read the liberal blogs, that’s patently obvious.  None of the rah-rah activism we saw when Republicans were in control or in office.  And certainly none of the enthusiasm they displayed then.

Probably the most damaging to the Democratic side, is their failure to hold on to the elderly vote, with which they usually do very well.  The elderly vote and it looks like they’re going to vote Republican this time around (again, assuming the poll numbers hold). At this point, the vast 2006 lead (52% to 38%) the Democrats held among the elderly voters (50 and over) has completely disappeared:

Voters younger than 30 favor the Democratic candidate in their district by a wide margin (57% to 32%). Yet only half of young voters say they are absolutely certain to vote. Voters ages 50 and older favor the Republican candidate in their district by double digits (11 points) and roughly eight-in-ten (79%) say they are absolutely certain to vote.

These polls, of course, provide national snapshots of feelings at the time they’re taken.  Their worth is as indicators and as they’re repeated over time, their ability to spot trends.  The trend now is toward the GOP candidate generically.  Some local races may tend toward a Democratic candidate, but overall, it appears to be shaping up as a GOP mid-term.

~McQ