Free Markets, Free People

Daily Archives: April 17, 2012


Unemployment: The myth and the reality

And all of it brought to you in charts via Zero Hedge.

The myth:

4-15-12_OfficialUnemployment

The "official" unemployment rate is 8.2%. Zero Hedge claims the real unemployment rate is 14.8%.

The reality in two charts.  Chart 1:

4-15-12_NotInLaborForce

In case you’re missing the point, 88 million are not participating. That is a whole lot less than when this started. As Zero Hedge asks ‘must be that everyone is able to retire’. Uh, yeah, right.  That chart and number provides context for the next chart. 

Lets go to Chart 2.  This is the chart that tells the tale and kills the myth:

4-15-12_PercentAmericansWithJobs

This is the chart that the GOP nominee ought to have permanently hanging at every single event he holds during this election season.  This is indicative of the real unemployment picture and it isn’t pretty.

Certainly, many Baby Boomers are choosing to retire, but as I said on the podcast, a) we’re just getting into Baby Boomer retirements and b) no one would dare argue that everyone has the ability to retire right now.  So there is a serious discrepancy between the official unemployment rate and the real unemployment rate.  That discrepancy is evident with these charts and destroys the myth of an improving unemployment picture.

~McQ

Twitter: @McQandO


Economic Statistics for 17 Apr 12

The following statistics were released today on the state of the US economy:

Housing starts fell -5.8% to a lower than expected 654k annual rate. Building permits, however, rose 4.5% to 747k annual rate.

ICSC-Goldman Store Sales fell -1.0% in the latest week, and the Y/Y rate fell to 3.2%. Redbook, meanwhile, reports a similarly weak 3% Y/Y rate.

The Fed reports that industrial production was unchanged for the month, while capacity utilization dropped -0.1% to 78.6%. Manufacturing declined by -0.2% for the month.

~
Dale Franks
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Quote of the Day: How big and intrusive has government gotten edition

The quote comes from a Heritage Foundation post on taxes and notes that today is “tax freedom day”, or the day in which what you earn from now on actually is supposed to belong to you:

In other words, for the first 111 days of the year, everything you earned went straight to Uncle Sam. Compare that to back in 1900, when Americans paid only 5.9% of their income in taxes and Tax Freedom Day came on January 22.

And in 1900, Americans felt that amount was outrageous.  But this puts in context the huge growth of government in the last century.

Here’s the problem though, it’s going to get worse – 2013 would be the year of the Obama tax increases if he’s re-elected and Congress doesn’t move to keep the current tax rates (which the left insists on calling the “Bush tax cuts” but which have, instead, been our current tax rates for years).

If those tax rates are allowed to expire, you can tack on another 11 days before we see “tax freedom day”.

That’s all due to Taxmageddon — a slew of expiring tax cuts and new tax increases that will hit Americans on January 1, 2013, amounting to a $494 billion tax hike. Heritage’s Curtis Dubay reports that American households can expect to face an average tax increase of $3,800 and that 70 percent of Taxmageddon’s impact will fall directly on low-income and middle-income families, leaving them with $346 billion less to spend.

Like sequestration, these tax increases are scheduled to happen on January 1st of next year.  Both are likely to have huge negative economic impacts.

On the tax side, Heritage’s Dubay points to immediate impact of some of the taxes that will become effective on that day:

If Congress fails to act, workers won’t have to wait very long to feel the effects. Every payday, they would see a jump in their payroll tax as it takes a bigger bite out of every paycheck. And that only reflects one of the direct hits they’ll face. They’ll feel the pain of other tax hikes they won’t pay directly, like the health care surtax on investment income and salaries over $250,000 — which begins in 2013 along with five other Obamacare tax hikes — because these hikes will slow job creation by taking away resources from businesses, investors, and entrepreneurs.

James Pethakoukis puts it into a chart for you:

041612

Says Pethakoukis:

If you combine all the other tax increases from 1980-1993, they add up to 3.3% of GDP, according to the brilliant budget team at Strategas Research. The coming “taxmageddon” of 2013 surpasses all those tax hikes combined! How could the Obama White House even toy with the idea, which it has, of letting them happen?

If they happen, can anyone guess what will happen to the economy?

So obviously, stopping this is a priority with President Obama, right?

That fact, though, isn’t making its way into President Obama’s talking points. He’s not mentioning that, absent action, Americans will pay higher income taxes, payroll taxes, and death taxes. He hasn’t spoken about the impending increase in the marriage penalty, the decrease in the child tax credit and the adoption credit, or how those who get tax breaks for education or dependent care costs will see them decreased. He hasn’t mentioned the new taxes under Obamacare, or how middle-income families will be forced to pay higher taxes under the Alternative Minimum Tax — a measure that was only supposed to impact “the rich.” Sound familiar?

Instead of dealing with Taxmageddon, President Obama wants to change the subject with a gimmicky policy like the “Buffett Tax.” The Senate obliged him yesterday by voting on this distraction. Fortunately, it was rejected. Still, while President Obama trains his fire on this class warfare policy, he ignores that if Taxmageddon strikes, the lower and middle class Americans that he says he is fighting for will pay substantially more in taxes to the federal government starting on January 1. Call it the unadvertised side effect of Barack Obama’s failed leadership.

So many “unadvertised” leadership failures in so few years.  Let this happen and watch the economy head toward the bottom again.  Of course, Obama won’t particularly care if he’s re-elected.  He’ll no longer be answerable to the American people.  He’ll have more “flexibility”.  He’ll be free to move more to the left.

A wonderful scenario and, in answer to the question in the title – you ain’t seen nothin’ yet.

~McQ

Twitter: @McQandO


Secret Service misconduct may mean deeper leadership problems

Whore-gate?  Who is going to hang the “gate” on the Secret Service scandal?

But it is interesting, isn’t it? The head of the Secret Service claimed yesterday that the behavior of this team was not “indicative” of the rest of the Service’s behavior.

Yeah, sorry, I find that hard to believe, at least at this point.  Something gave this team the belief that they could do what they did and get away with it.  Leaders claiming such nonsense are always suspect.  I just don’t buy into this one advance team being an outlier.

I would assume, as a matter of leadership, that more senior members of the service make it a point to travel with advance teams without advance notice just to see how well the teams function and do their job.  Or at least I’d hope so.

Leadership is about supervision.  It’s about getting off your rear and checking out how well your unit functions, how closely they follow SOP and how well leaders junior to you do their jobs. 

Why am I getting  the feeling that’s not the case in the Secret Service?  Because of this fiasco in Columbia.

Now its been revealed that the President’s schedule was laying around in the hotel rooms they brought the hookers too.  Security?  Where?

I’ve also heard it said, mostly as an excuse, that they were “off duty”.  Sorry, that’s a no-go.  There are certain standards of conduct that are required in particular organizations that really never allow one to be “off duty”.   What a member of that unit does even when not actively engaged in their job reflects on their organization and could compromise their integrity. 

For instance, in this case, how difficult would it be to blackmail a Secret Service agent who knows that revealing his consorting with prostitutes would cost him his job?

This isn’t the first case of Agent misconduct.  But it is the most widespread and possibly one of the worst cases.  It speaks of a leadership problem to me.  Someone in a leadership position was trusted to lead an advance team.  That means those in higher leadership positions trusted this person to carry out the job professionally, morally and with integrity.  Someone was very mistaken.  That puts the entire leadership of the Secret Service under the microscope, not just this team.

The seriousness of this had me shake my head when I read this:

The Senate Judiciary Committee, which oversees the Secret Service, is weighing whether to launch an investigation into the prostitution allegations.

Weighing whether to launch an investigation?

Really?

~McQ

Twitter: @McQandO


ICYMI: Democrats losing the voter fraud argument

At least in the eyes of the American people if this Rasmussen poll is accurate:

Despite his insistence that voter fraud is not a serious problem, Attorney General Eric Holder was embarrassed last week when a video surfaced of someone illegally obtaining a ballot to vote under Holder’s name in his home precinct in Washington, D.C. Most voters consider voter fraud a problem in America today and continue to overwhelmingly support laws requiring people to show photo identification before being allowed to vote.

Why do they support the requirement so overwhelmingly?

Simple common sense.  The arguments we’ve been putting forward for years – a photo ID is absolutely necessary to do many of today’s daily chores, so producing one to vote is no big deal.   And, in fact, it helps maintain the integrity of a system that badly needs such a shot in the arm.

Or said another way, most Americans don’t buy the argument that voter fraud isn’t a problem.  Additionally most Americans certainly don’t see one of the solutions – voter ID—to be a problem either. 

We’re not talking about a slim majority here:

A new Rasmussen Reports national telephone survey finds that 64% of Likely U.S. Voters rate voter fraud at least a somewhat serious problem in the United States today, and just 24% disagree. This includes 35% who consider it a Very Serious problem and seven percent (7%) who view it as Not At All Serious. Twelve percent (12%) are undecided. (To see survey question wording, click here.)

As for photo IDs?

Seventy percent (70%) of Likely U.S. Voters believe voters should be required to show photo identification such as a driver’s license before being allowed to cast their ballot. A new Rasmussen Reports national telephone survey finds that just 22% oppose this kind of requirement. (To see survey question wording, click here.)

So here’s a loser for the left.  It is something that actually hurts the left because most people don’t accept the argument that obtaining acceptable ID is either discriminatory or difficult.  They also know, from personal experience, how often they are asked to produce such ID while navigating everyday life.

Consequently, when the left tries those arguments, it falls on deaf ears.  They are instead seen as a group with something to hide, a group with an ulterior motive for wanting the requirement struck down.  And that motive isn’t seen as a positive one either. 

So?  So let the left continue to push the issue and continue to alienate those who see the requirement as a common sense safeguard against fraud.  It certainly isn’t going to help Democrats convince voters they’re for voter integrity, that’s for sure.

~McQ

Twitter: @McQandO