WATCH THE OBJECTIVE FACTORS
A Post-Convention Perspective
By Jay B Gaskill
The real inflection-point question of this election is – Are you more secure now than you were three years ago?
Three years ago was September 2009.
From a news report in January, 2009, “WASHINGTON — Without a single Republican vote, President Obama won House approval on Wednesday for an $819 billion economic recovery plan as Congressional Democrats sought to temper their own differences over the enormous package of tax cuts and spending. As a piece of legislation, the two-year package is among the biggest in history.”
In February of that year, as the president signed the final legislation, another report told America that – “President-elect Barack Obama yesterday formally unveiled his economic team, including the nomination of New York Federal Reserve Bank President Timothy F. Geithner as the new administration’s U.S. Treasury secretary. The team’s first challenge will be assembling an economic stimulus package that could be even larger than the $700 billion Troubled Asset Relief Program the Bush Administration has deployed.”
In February, 2010, Americans learned that the unemployment rate was 9.7 percent in January, and the Labor Department revealed that the economy had lost 20,000 net jobs during the month.
As of August this year, an inventory of the stimulus spending reveals the following – “700.5 billion was paid out in three categories – tax benefits 297.8 billion, contracts grants and loans 240.4 billion, and 232.3 billion, entitlements.” (http://www.recovery.gov/Pages/default.aspx)
I have separately pointed out the key distinction between government money spent for government purposes and private investment money spent to generate profit-making businesses. Very little, if any, of the much touted Obama stimulus of 2009 found its way into profit-making enterprises. Not only did that infusion of borrowed money quickly fizzle out, the towering deficit that remains and grows has sharply inhibited the government’s ability to attempt a redo in any attempt to “get it right this time.” Our situation is not unlike that of a depression-era family whose breadwinner is out of work, where the teenager-in-residence blows the entire family savings (with which dad was going to buy carpenter tools) on a poker game. What a wasted opportunity.
…And today? This fact check from CNN is telling on a number of levels:
“(CNN) — Anyone watching the Democratic National Convention on Tuesday night heard the number 4.5 million several times. ‘Despite incredible odds and united Republican opposition, our president took action, and now we’ve seen 4.5 million new jobs,’ San Antonio Mayor Julian Castro, the party’s keynote speaker, said.Chicago Mayor Rahm Emanuel, who served as President Barack Obama’s chief of staff, and Massachusetts Gov. Deval Patrick, who followed Obama’s November rival Mitt Romney as governor of Massachusetts, both cited the same number. It’s a big-sounding number, given the still-sputtering job market. So we’re giving it a close eyeballing.
“The number Castro cites is an accurate description of the growth of private sector jobs since January 2010, when the long, steep slide in employment finally hit bottom. But while a total of 4.5 million jobs sounds great, it’s not the whole picture.
“Nonfarm private payrolls hit a post-recession low of 106.8 million that month, according to the U.S. Bureau of Labor Statistics. The figure currently stands at 111.3 million as of July.
“While that is indeed a gain of 4.5 million, it’s only a net gain of 300,000 over the course of the Obama administration to date. The private jobs figure stood at 111 million in January 2009, the month Obama took office.”
We are not just treading water, we are continuing to sink.
The Center for Economic and Policy Research (CEPR) (whose advisory board includes Nobel Laureate economists Robert Solow and Joseph Stiglitz; Janet Gornick, Professor at the CUNY Graduate School and Director of the Luxembourg Income Study; and Richard Freeman, Professor of Economics at Harvard University) reminds us that “the underlying rate of labor force growth is now just 0.7 percent annually. This comes to roughly 1,050,000 a year or just under 90,000 a month.”
The CEPR and similar credible sources remind us that the touted net gain of 300,000 jobs for the Obama administration to date was at least 2.7 million jobs short of treading water.
Worse – the unemployment rate is understated. Gallup Polls put the underemployment number around 17%.
Worse, still – job security is weak. Today’s Rasmussen Poll tells us that “Twenty-one percent (21%) of workers report than their firms are hiring, while 23% report layoffs. That’s the second straight month in which reported layoffs top hiring. Concern about job security is rising. Just 62% of workers believe it will be their choice when they change jobs. That’s down 12 points from July and down 19 points from May. It’s the lowest level of confidence measured in more than three years.” http://www.rasmussenreports.com/public_content/politics/obama_administration/daily_presidential_tracking_poll
These are among the objective factors in this election, and they will quickly begin sinking-in as the post-convention glow recedes.
I remain convinced that this election pivots on the economy, particularly on the trust issue. Americans have been traumatized. They now wonder whether the current administration is still worthy of their trust on economic issues.
The burden now falls to the Romney campaign to fill in the blanks. How will you manage a turnaround? Why should we trust you?
Copyright © 2012 by Jay B Gaskill, Attorney at Law (except for the quoted material which is repeated here under the fair use rules)
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