Sunday, October 7, 2012

Joblessness: It's More Than the Numbers

For liberal Democrats the debacle in Denver was an integrity test. Many have passed it. They have been willing to affirm the obvious: that Barack Obama lost his first debate with Mitt Romney, by a lot.

Only a few inveterate party hacks, like George Stephanopoulos even dared say it was a draw.

True believers have been trying out the idea that Romney lied his way through the debate and that poor Barack was gobsmacked to the point of being struck dumb.

It was predictable: when you don’t have a record and don’t have any new ideas, you fall back on character assassination.

Speaking of lies, before the debate the Obama campaign had succeeded in creating a wildly negative portrait of Mitt Romney. It is fair to say that Romney had done his part to make it sound plausible.

In Denver the American people had their first chance to see Romney paired off against Obama. They seem to have had a collective epiphany… to the effect that Romney looked far more competent, engaged and in charge than Obama.

Obama’s friends have been trying to say that debating is beneath him, but that seems merely to show the man’s arrogance. Perhaps he hasn’t been doing his job because he believes that being president is beneath him.

It is also true that the Romney who showed up to debate differed sharply from the Romney who had been running a campaign that, at best, was lackluster.

The new Romney was not the mean-spirited and hostile character who had debated his Republican primary opponents into submission.

Until last Wednesday Mitt Romney had not presented himself as an especially competent or sympathetic figure. The most important story from the debate was that Mitt Romney offered a better version of himself.

However bad Obama looked, that was how well Romney did.

Mort Zuckerman described the new Romney:

What was remarkable was that Romney, who has been in everyone's dog house for months with an erratic campaign, has suddenly assumed the stature of a president. He was warm, articulate, logical, informed, forceful, and most important, presidential. He was more engaged, more detailed, more decisive, more animated, more aggressive in attack, and more robust in defense than the president, who was lackadaisical and without mastery of the facts or the ability to respond to what was put forth by his challenger.

By appearing to be presidential Mitt Romney showed that Barack Obama was anything but.

Now, the Obama team is regrouping. It is pinning its hopes on Friday’s jobs report. Mediocre at best, the report is being touted as irrefutable evidence that Obama has gotten the country back on the right track.

Unfortunately, the debate has centered around what Mark Twain called: “lies, damn lies and statistics.”

As he has done in previous columns Zuckerman puts the data in a larger context:

The real unemployment rate is 15 percent, measured by what is called U-6, which includes people who are working part-time on an involuntary basis. We have 4.7 million fewer jobs than the peak reached at the end of 2007. And indeed much of the improvement in jobs has been through dubious "seasonal" adjustments, such as the July seasonal bump of 377,000 jobs—the largest such adjustment for July in the past 10 years. The labor participation rate has dropped to a 30-year low, and if not for that development, the unemployment rate would be much higher.

Fewer Americans are at work today than in April 2000, although the population has grown by 31 million since then. A worker between the ages of 50 and 61 who has been unemployed for over a year has only a 9 percent chance of finding a job in the next three months. A worker who is 62 years or older and similarly unemployed has about a 6 percent chance. And 50 percent of this year's college graduates are without jobs or are underemployed. What a waste.

The Economist echoes the same thought:

The employment situation is still horrific, the pace of the recovery continues to be achingly slow, and many of the jobs created recently have been part-time. While the report indicates no substantive deterioration in the labor market relative to what we have come to expect, it is far from encouraging to anyone who has been disappointed by the economy’s performance over the past several years.

The Federal Reserve Bank has pointed out that the labor market, like the nation, has become increasingly polarized. Job opportunities exist at the top and the bottom, but not in the middle.

The Federal Reserve notes the following:

It was also suggested that there was an ongoing process of polarization in the labor market, with the share of job opportunities in middle-skill occupations continuing to decline while the shares of low and high skill occupations increased.

A former Obama supporter, Zuckerman despairs for a leaderless nation:

The fundamental issue for America is that we seem to have lost our way and we haven't found it after four years of the Obama administration, thanks to a leadership so lacking that the American dream now seems to be a chimera of nostalgia. The president appears to have lost his intellectual interest.

It is all very well to raise a sword and cry "Forward!" but to what? Campaigning and barnstorming, at which Obama is very good, is no substitute for brainstorming to evolve a cohesive set of plans to deal with the current crisis. Yes, he inherited a financial crisis that he had no part in causing. But after the most stimulative fiscal and monetary program in the country's history—he racked up almost $5 trillion in deficits in four years, which had previously taken us 205 years to accumulate—we have had at least a retreat from the edge of the cliff with some emergence of occasional green shoots in the desert.

When compared with Mitt Romney, Obama did not look good. When his record is compared with those of his predecessors, the current president does not fare well either.

Perhaps Zuckerman was offering a retort to Bill Clinton’s assertion that Obama had done as well as anyone could have done under the circumstances:

Every president in modern times who has inherited a recession from his predecessor boasts a better track record. In fact, of the past 10 recessions, this has been the weakest recovery ever. And in the second quarter, GDP growth was down to 1.3 percent. And a slew of major hard data since the beginning of September have had to be revised sharply lower. Non-farm payrolls, retail sales, industrial production, and housing starts all received downward bumps, setting a stage for an even more sluggish performance in the third quarter. Durable goods orders in August served up another huge downward slide.

Indeed, the 1.3 reading on the second quarter GDP marks the weakest growth in the 12th quarter after a recession. By this time, at the same stage of a recovery, real GDP is expanding on average at 4.7 percent. That is after four years of $1 trillion plus fiscal deficits. Orders plunged to 13.2 percent sequentially during August, far exceeding the market expectations for a 5 percent decline.


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Sam L. said...

Who am I going to believe? I'll take "My Lying Eyes" for $1000, Alex.