Jobless Rate Rises

For the second straight week, the jobless rate has risen, confounding liberals and the media. The recession was supposed to be over, but I guess the people who do the hiring didn't get the memo.

I "doubt" that the recent health care legislation, with its new and confusing regulations and taxes on businesses has had any impact on the business sector and their decisions to hire, not hire or even lay off employees. Of course, we know that health care reform is going to balance the budget and save everyone tons of money.

A year ago, Dick Morris (whom I respect, but don't always agree with) predicted that the jobless rate would rise in response to the Generational Theft Act (stimulus) to around 10% nationally. He also predicted that it would stay near that rate for 2010 and perhaps beyond. Furthermore, he predicted that as we move into 2010 and 2011, we would begin to see an increasing rate of inflation that would trigger a second recession before we've even recovered from the first one.

While we've yet to see a significant amount of inflation, Morris' predictions usually tend to be pretty accurate. We've already seen gas prices rise, and the price of other goods and services usually trend upwards when gas prices go up because almost everything we buy is affected by the cost of fuel.

I'm not optimistic about our future. With the passage of health care reform, it appears the recession is going to extend into the foreseeable future, despite proclamations that it is over. We might as well get used to double digit unemployment. Unless we can reverse the damage O.B.A.M.,A. has done, it is likely to become the norm. Pollsters and other experts are backing off of predictions that the Republicans will take back the House and Senate. At best, they will neutralize the Democrats' majority, but it is highly unlikely they will get enough seats to pass their own agenda, let alone repeal any of what O.B.A.M.,A. has done (including health care).

Even looking forward to 2012, prospects aren't much better. Assuming we can get a Republican back in the White House, many of the front runners (including Huckabee and Romney) are far from conservative. They are in favor of many of the same programs and spending polices of the left, just to a slightly lesser degree.

Sorry for the "negative" post, today, but given that it's April 15 (Tax Day), perhaps some honest evaluation of where we are at economically is in order.

Biden Ain't Lying ... Well, he was kinda lying

Melissa Clouthier Writes:

Joe Biden stated last weekend that the administration underestimated the economic problem. You don’t say. Really, the didn’t think there even was a problem and decided to jam through Dem spending programs to pay off key Democratic constituencies. Only 1% of the Stimulus money has been loosed from bureaucratic hell. The rest will hit just in time for Obama’s reelection.

The right people, will get the right money at the right time.

America’s tax dollars are part of a huge re-election effort. The Stimulus was all about Barack Obama and the big Democrats in Congress redistributing wealth to their buddies.

If an American citizen is out of a job, though, he might be kinda outta luck.

The Democrats demagogued the economy while at the same time saying everything was going to be wonderful. Remember the lady who said that President Obama was going to bring her groceries? President Obama gravely intoned about certain doom, while gloriously proclaiming “help is here!” Rich Lowry says:

Apparently we were going to experience a once-in-a-lifetime economic crisis comparable to the Great Depression without a particularly high unemployment rate. This was the promise of the Obama administration, which indulged in hair-raisingly alarmist economic rhetoric while pumping out unduly hopeful economic projections. If the Reagan administration gave us the rosy scenario, the Obama administration has given us the rosy apocalypse.

So now, the Democrats want to do some form of a real stimulus, because, like, you know, the economy really is bad.

The problem for the Democrats is that they sold the initial lie too well. People actually believed that the stimulus was going to give them jobs. They believed that the economy would be better and will get better. They believed that they would feel the help personally. They were sick of the Party of No and wanted to try new ideas. More than one swing voter said, “Well, I haven’t been happy with the way things have been, let’s give the other sides’ ideas a try.”

But people of a certain age remember President Carter. And if they have any memory whatsoever, this road looks very familiar because it is familiar. America has been down it before. But the problem is, this time, the road is even worse. And people know that too, even as the Obama administration and a Democratic Congress played politics with lives of ordinary Americans.

Americans aren’t taking too kindly to another Stimulus (neither are economists). I bet the focus groups are scaring the hell out of Democrats right now. Americans are frightened at the spending, understand that the Cap-N-Trade is another big Control and Tax scheme and see the Democrats now wanting to monkey with small business (Card Check) and health care. People are backing away in horror, just as Democrats are thinking about reelection.

Is it possible to be a lame duck one year into office? President Obama is burning through political capital like he’s burning through tax payer money. He seems to think both are never-ending giving trees.

Media Falls For Phony Jobs Claims

Tony Fratto is envious.

Mr. Fratto was a colleague of mine in the Bush administration, and as a senior member of the White House communications shop, he knows just how difficult it can be to deal with a press corps skeptical about presidential economic claims. It now appears, however, that Mr. Fratto's problem was that he simply lacked the magic words -- jobs "saved or created."

"Saved or created" has become the signature phrase for Barack Obama as he describes what his stimulus is doing for American jobs. His latest invocation came yesterday, when the president declared that the stimulus had already saved or created at least 150,000 American jobs -- and announced he was ramping up some of the stimulus spending so he could "save or create" an additional 600,000 jobs this summer. These numbers come in the context of an earlier Obama promise that his recovery plan will "save or create three to four million jobs over the next two years."

Mr. Fratto sees a double standard at play. "We would never have used a formula like 'save or create,'" he tells me. "To begin with, the number is pure fiction -- the administration has no way to measure how many jobs are actually being 'saved.' And if we had tried to use something this flimsy, the press would never have let us get away with it."

Of course, the inability to measure Mr. Obama's jobs formula is part of its attraction. Never mind that no one -- not the Labor Department, not the Treasury, not the Bureau of Labor Statistics -- actually measures "jobs saved." As the New York Times delicately reports, Mr. Obama's jobs claims are "based on macroeconomic estimates, not an actual counting of jobs." Nice work if you can get away with it.

And get away with it he has. However dubious it may be as an economic measure, as a political formula "save or create" allows the president to invoke numbers that convey an illusion of precision. Harvard economist and former Bush economic adviser Greg Mankiw calls it a "non-measurable metric." And on his blog, he acknowledges the political attraction.

"The expression 'create or save,' which has been used regularly by the President and his economic team, is an act of political genius," writes Mr. Mankiw. "You can measure how many jobs are created between two points in time. But there is no way to measure how many jobs are saved. Even if things get much, much worse, the President can say that there would have been 4 million fewer jobs without the stimulus."

Mr. Obama's comments yesterday are a perfect illustration of just such a claim. In the months since Congress approved the stimulus, our economy has lost nearly 1.6 million jobs and unemployment has hit 9.4%. Invoke the magic words, however, and -- presto! -- you have the president claiming he has "saved or created" 150,000 jobs. It all makes for a much nicer spin, and helps you forget this is the same team that only a few months ago promised us that passing the stimulus would prevent unemployment from rising over 8%.

It's not only former Bush staffers such as Messrs. Fratto and Mankiw who have noted the political convenience here. During a March hearing of the Senate Finance Committee, Chairman Max Baucus challenged Treasury Secretary Timothy Geithner on the formula.

"You created a situation where you cannot be wrong," said the Montana Democrat. "If the economy loses two million jobs over the next few years, you can say yes, but it would've lost 5.5 million jobs. If we create a million jobs, you can say, well, it would have lost 2.5 million jobs. You've given yourself complete leverage where you cannot be wrong, because you can take any scenario and make yourself look correct."

Now, something's wrong when the president invokes a formula that makes it impossible for him to be wrong and it goes largely unchallenged. It's true that almost any government spending will create some jobs and save others. But as Milton Friedman once pointed out, that doesn't tell you much: The government, after all, can create jobs by hiring people to dig holes and fill them in.

If the "saved or created" formula looks brilliant, it's only because Mr. Obama and his team are not being called on their claims. And don't expect much to change. So long as the news continues to repeat the administration's line that the stimulus has already "saved or created" 150,000 jobs over a time period when the U.S. economy suffered an overall job loss 10 times that number, the White House would be insane to give up a formula that allows them to spin job losses into jobs saved.

"You would think that any self-respecting White House press corps would show some of the same skepticism toward President Obama's jobs claims that they did toward President Bush's tax cuts," says Mr. Fratto. "But I'm still waiting."