Tag Archives: United States Department of Labor

Not Surprising

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On Saturday Newsmax posted an article about the ‘For The People Act,’ House Bill 1 and Senate Bill 1. The bill is not for the people–it’s for the Democrats to insure victories in upcoming elections. The bill federalizes and politicizes elections in favor of the Democrats who now essentially control Congress and the White House.

The article reports:

The Senate will vote on a bill that would dramatically change how elections are run next month.

According to a memo sent out by Senate Majority Leader Chuck Schumer, the bill known as the “For the People Act,” or  H.R. 1 or S. 1, will be voted on in June.

Democrats view the sweeping reform bill as anti-corruption legislation that will combat “restrictive” voting bills from their Republican colleagues. The act would federalize parts of the election system, eliminating qualifications such as photo identification and allowing same-day registration on any day that voting is permitted.

“In my state in Oklahoma, we have great voting engagement. We want to make it easy to vote and hard to cheat. S1 takes away a state’s ability to hold people accountable for cheating,” Sen. James Lankford, R-Okla., said, according to The Epoch Times.

Sen. Cindy Hyde-Smith, R-Miss., described the bill as a massive federal “takeover of elections.”

Democrats, however, largely support the legislation.

I have previously reported on H.R. 1 (article here). It truly is a nightmare for those who want honest elections in America. Among other things it forbids the use of voter id to insure that voters are who they say they are. It also changes the non-partisan Federal Election Commission into a partisan body by creating an uneven number of Commissioners.

The article at Newsmax concludes:

At a caucus lunch on Capitol Hill, Schumer told reporters, “it was made clear how important S1 is to the country, to our Democratic majority, and to individual senators, and those discussions are going and I have a lot of faith in them.”

The Senate is currently divided 50-50 between Republicans and Democrats. Passing the bill would require at least 60 votes.

Schumer plans to bring other pieces of legislation up for a vote in June, including the Paycheck Fairness Act, which would hold the Department of Labor to study pay disparities between men and women while making their results public. He also said he might force another vote on the riot that occurred on Jan. 6 at the Capitol.

If these bills do not pass (which I hope is the case), we can expect to see the Democrats move to end the legislative filibuster. That will be the end of our country as we know it. It will give the Democrats free reign and not require any sort of negotiations or compromises with the Republicans. That is not good for our Republic.

The Numbers Are Good, But They Need To Be Better

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The American economy is slowly improving. It is not racing along, but it is improving. Investor’s Business Daily recently posted an editorial explaining that although we have a 4.1 percent unemployment rate, we are not yet at full employment. As the article explains, there are other numbers that need to be considered when looking at the economy.

The editorial reports:

But look at the numbers more closely and you see that we are far from full employment.

First, the 0.1 percentage point decline in the unemployment rate in October was almost entirely the result of the fact that 968,000 dropped out of the labor force that month.

That’s right, for every new job created, nearly four people left the labor force.

The broader measure of unemployed — which combines those actively searching for a job with those working part time but want to work full time or are “marginally attached” to the labor force — show the jobless rate to be 7.9%.

And the IBD-TIPP poll shows that there’s likely even more slack than that. The October survey — which asks those polled whether they or anyone in their household is looking for work — shows that the share of job seekers is currently above 10%. This number, by the way, has consistently tracked higher than either of the BLS’s two measures.

Here’s another way to look at it. Back in December 2000, the unemployment rate was 3.9%. But that month, the labor force participation rate — the share of the population that’s either working or looking for a job — was 67%.

The current rate: 62.7%.

If the labor force participation rate were the same today as it was in 2000, the official unemployment rate would be more like 10%.

The 10% unemployment rate would be better than what the actual rate has been in recent years, but obviously, it is not good.

The editorial concludes:

There is clearly still a need for pro-growth policies to get millions of workers sitting on the sidelines back to work.

Those pro-growth policies need to begin with the passage of President Trump’s tax proposal followed by a complete repeal of ObamaCare. If the Republicans in Congress want to be re-elected, they need to do both. It is time to put away the fear of a political outsider succeeding as President and begin to work together to move the country forward.

An article on

An article on the website of the JFK Library includes the following paragraph:

The president finally decided that only a bold domestic program, including tax cuts, would restore his political momentum. Declaring that the absence of recession is not tantamount to economic growth, the president proposed in 1963 to cut income taxes from a range of 20-91% to 14-65% He also proposed a cut in the corporate tax rate from 52% to 47%. Ironically, economic growth expanded in 1963, and Republicans and conservative Democrats in Congress insisted that reducing taxes without corresponding spending cuts was unacceptable. Kennedy disagreed, arguing that “a rising tide lifts all boats” and that strong economic growth would not continue without lower taxes.

I wonder if John Kennedy would be welcome in today’s Democratic party.

 

Good News On The Job Front

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The Labor Department’s Bureau of Labor Statistics released its jobs numbers for June this morning. CNS News posted the numbers.

This is the Labor Force Participation Rate chart taken from the Bureau of Labor Statistics:

As you can see, the Labor Force Participation Rate is fairly steady and moving upward.

Meanwhile, the article at CNS News reports:

The U.S. economy added 220,000 jobs in June, the best showing since February and well above analysts’ expectations of 174,000.

The Labor Department’s Bureau of Labor Statistics also said the number of employed Americans — which set records in February, March and April — set another record in June, at 153,168,000 employed.

And the number of Americans not in the labor force — after four straight monthly gains – dropped a bit to 94,813,000.

There is still a lot that needs to be done to put Americans back to work, but we are moving in the right direction. Cutting back on federal regulations should help stimulate the economy, but that impact of cutting those regulations may not be immediately felt.

The article further reports:

Over the past 3 months, job gains have averaged 194,000 per month.

In a June 29, 2017 update, the Congressional Budget Office said it expects the U.S. labor market to tighten in the next two years, as greater demand for workers will push the unemployment rate down and the labor force participation rate up.

The projected demand for workers will encourage more people to participate in the labor force, temporarily offsetting the projected decline in participation arising from such factors as the ongoing retirement of baby boomers.

CBO projects that the unemployment rate will remain around 4.3 percent by the end of 2017 and then drop further to 4.2 percent in early 2018.

The Real Unemployment Numbers

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The Obama Administration has proudly announced an unemployment rate of 4.6% for November 2016. That’s nice, but that isn’t the real story.

CNS News posted a story yesterday explaining the 4.6 % number and using some other numbers to put that number in perspective.

The article explains:

Although the “unemployment rate” in the United States for November is 4.6% — a rate last reached 9 years ago in August 2007 – the “real unemployment” rate is much higher, more than double at 9.3% nationwide. 

Real unemployment, or the U-6 number, as calculated by the Bureau of Labor Statistics (BLS) includes “total unemployed, plus all marginally attached workers” and part-time workers age 16 and over.

As the BLS explains on its website, the “unemployment rate,” or U-3 number, “includes all jobless persons who are available to take a job and have actively sought work in the past four weeks.”

The other number that is important is the workforce participation rate. The chart below from the Bureau of Labor Statistics illustrates how that number has changed during the Obama Administration:

workforceparticipationrate1

The article at CNS News concludes:

While the unemployment rate for November 2016 was 9.3%, the last time it was at a level close to that, 9.2%, was in April 2008. From June 2008 through September 2015, the real unemployment rate was in double digits, fluctuating from 10.1% to a high of 17.1% and finally back down to 10.0% (in September 2015).

The real unemployment rate has been in the 9’s since October 2015. 

The 4.6% unemployment rate sounds wonderful, but since it does not include those Americans who are out of work and no longer looking for work, it is not a meaningful number. The American economy has not prospered under President Obama. Hopefully, putting a successful businessman in the White House will change the American economy for the better.

Looking Past The Obvious

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President Obama has touted the ‘economic recovery‘ as one of his accomplishments. He might want to be a little quieter about that as the latest jobs figures and the numbers behind them indicate a very slow recovery.

Yesterday Investor’s Business Daily posted an article about the jobs numbers just released.

Some highlights from the article:

While last month’s overall gain of 38,000 jobs, including a 25,000 rise in private payrolls, was dragged down temporarily by the labor strike of 35,000 Verizon (VZ) communications workers, the weakness was broad-based. On net, just 51.3% of industries added jobs, the lowest since February 2010, Labor Department data showed.

…One decent bit of news in the employment report is that the trend of firming wages remained intact, as hourly pay rose 0.2% from April and 2.5% from a year ago. That’s consistent with anecdotal reports of companies having to pay more to attract or keep good workers, and many finding qualified workers in short supply.

…The drop in the unemployment rate to 4.7% from 5% in April appears at first to be consistent with a tight labor market. Still, the sudden drop in joblessness, which reflected fewer people in the workforce rather than an increase in employment, should be taken with a grain of salt, given the household survey’s higher margin of error.

…The reality portrayed by the weak jobs report got some confirmation from the Institute for Supply Management’s survey of non-manufacturing industries, with the index slipping to a 28-month low of 52.9 in May from 55.7 in April — well below expectations. The employment gauge fell into negative territory, dropping 3.3 points to 49.7, just below the neutral 50 level.

…Somehow, the retail sector has seemingly defied gravity when it comes to employment, adding 11,400 jobs last month and 323,000 over the past year. The explanation may be that the workweek has shrunk, since aggregate hours of work in the retail industry are down 0.3% over the past three months.

So what is the bottom line? Workforce participation is down, job growth is slow, and the number of hours people are working has gone down. That doesn’t sound like a robust economic recovery to me. It is definitely time for a change of direction. As I have previously stated, I am not a Trump supporter, but I will vote for him because I believe that he may have the business experience to turn this mess around.

Changing The Rules In The Middle Of The Game

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Hot Air posted an article today about a federal jobs program for youth. The program is part of President Obama’s Summer Opportunity Project. This is the description of the program when it was announced:

The Summer Opportunity Project is a multi-agency effort in partnership with the National Summer Learning Association and other collaborators to provide support to communities. The Project aims to significantly increase the percentage of youth in evidence-based summer opportunity programs, decrease the percentage of youth experiencing violence over the summer, and—more broadly—make sure that young Americans have the support they need to get their first job.

Research shows that Black and Hispanic teenage boys lag behind their peers in summer employment and year-round jobs. This employment gap broadens as young men get older, making them the highest percentage of the nearly seven million youth 16-24 disconnected from school and work. That’s why the President’s My Brother’s Keeper Task Force recommended to the President in May of 2014 strengthening the case for summer youth employment and launching a cross-sector campaign to reduce summer learning loss and increase the number of job and internship opportunities for all young people.

I am going to ignore the constitutional problem with the government creating jobs and say that this program looks reasonable. However, what you start with is not necessarily what you finish with.

It turns out that the Summer Opportunity Project funds have been diverted:

Utica is among 11 communities nationwide that will share $21 million in grants for summer jobs programs aimed at helping disadvantaged youth, the White House and U.S. Department of Labor said Monday.

Utica will receive almost $2 million to help 400 students in the city’s refugee population receive summer work experience and part-time jobs the rest of the year, White House officials said.

The Utica students also will receive tutoring in English and math as part of the New Americans Career Pathways Project.

The federal money is part of the Summer Opportunity Project launched by the White House in February.

So rather than help the Black and Hispanic Americans who have grown up here and need jobs, we are taking the money away from them and spending it on refugees. Let’s help our own children first please.

 

The Economy By The Numbers

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On Friday, Investor’s Business Daily posted their analysis of the recent jobs report. The report was more positive than some recent reports, but there were still a few problems.

The article reports:

The alternative measure used by the Department of Labor based on the household survey, showed job growth was even swifter, with a gain of 485,000. Best of all, nearly half a million Americans on net entered the labor force, helping reverse for now a horrid slide in labor market participation.

The participation rate now stands at 62.6%, up from 62.4% in September. But we’re still way behind the pre-recession high of 66.2% in 2007. A record 94 million Americans over the age of 16 are not working or looking for work.

Average wages were down a notch to $25.24 — bad news on a number of fronts. Real median wages have now been flat for almost a decade. It looks like a lot of those new jobs in December were at McDonald’s or Wal-Mart. About 37,000 came in bars and restaurants. The painful pattern of this recovery is that the jobs gained don’t pay as much as the jobs that have disappeared.

The article also address the falling oil prices:

Low oil prices are normally good news for the economy, but their relentless decline of late is a symptom of weak global demand from producers. The likelihood of any growth-oriented policy changes in Washington on regulations, taxes, ObamaCare or trade promotion seem remote in the near term. And the Fed is warning of three or four more interest-rate hikes later in the year.

Also on Friday, Donald Trump, the Republican front-runner for president, proposed a 45% tariff on Chinese goods and services. It’s hard to be bullish in such an environment.

We need some serious changes in economic policies in order to grow the economy. Hopefully the election in November will bring those changes.

Why Government Regulations Matter

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Today’s Wall Street Journal featured a story by Rhea Lana Riner. Mrs. Riner founded Rhea Lana’s in 1997. It is a consignment company for secondhand children’s clothes. The company began in her living room and soon expanded. In 2008, the company converted to a franchise model and now has 80 locations across 24 states.

The article at The Wall Street Journal explains what has happened to the business in the past two years:

Rhea Lana’s operations are similar to more than a thousand other consignment event businesses in the country. Our locations host two sales a year, each running two to eight days. Before a sale, consignors list their clothes and toys on our website, along with their asking prices. On the day of the event, they bring the items to the location and set them up for display. Consignors keep 70% of the proceeds.

They can also volunteer before and during the event—doing everything from setting up display racks, to checking out customers, to helping buyers carry heavy purchases to their cars. As a perk, volunteers are allowed to shop before the general public, and they are sometimes given preferential treatment on display locations for their own items.

But such mutually beneficial exchange is apparently a foreign concept to the federal government. In January 2013 the Labor Department audited our employment practices. Four months later the bureaucracy concluded that our volunteers are actually “employees.” As such, we were told that we were in violation of Sections 6 and 7 of the Fair Labor Standards Act regarding minimum wages and overtime pay. I was told this during a face-to-face meeting, without any accompanying written complaint or advance notice of allegations.

This is a business that helps mothers buy beautiful clothes for their children at reasonable prices. The business model includes volunteers. These volunteers are in no way coerced into volunteering–they are people who want to help who may not be able to commit to the regular hours of a job.

The article further explains:

The case raises questions about what it means to volunteer in the 21st-century economy. Some—including, apparently, the Labor Department—believe it is illegal for a private business to receive an ounce of help without providing financial compensation. But as our business model shows, there are situations in which volunteering is mutually beneficial, even without money changing hands. Besides, if someone wants to spend a weekend helping families find affordable clothes and toys, why on earth would the federal government stop them?

If a friend of mine opens a store and I volunteer to paint the walls for him, am I breaking a law? This is clearly an example of government overreach. Hopefully the courts will eventually decide this in the right way, but it is a shame that the government has chosen to harass  Mrs. Riner for her efforts to help make children’s clothes more affordable.

Lying With Statistics

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Yesterday The Federalist posted an article about the latest unemployment numbers from the Department of Labor. There was rejoicing that the unemployment rate had dropped to 5.5 percent. You might want to hold off on that rejoicing for a bit.

The article includes a chart showing what the unemployment number actually is when you add in the labor force dropouts:

Unemployment Rate With Labor Force Dropouts March 2015

As you can see, the actual unemployment rate is closer to 10 percent. So, if you know anyone who is unemployed and can’t understand why it is so hard to find a job, show them the real numbers. It might make them feel better.

The article explains:

This decline (the decline in the labor force participation rate) has significant effects on the official unemployment rate. People who are unemployed and eventually stop looking for work are no longer counted as being part of the labor force, which means they’re no longer counted by U.S. statistical agencies as being unemployed (you can read in detail about the math underlying this dynamic here). The result? An artificially low official unemployment rate.

It is an unfortunate fact of life that you can make statistics say pretty much anything you want them to say.

Is The Economy Getting Stronger?

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Reuters posted a story today about the latest jobless claim numbers.

The article reports:

The number of Americans filing new claims for unemployment benefits last week increased to the highest level since early September, but the underlying trend continued to point to a strengthening labor market.

Initial claims for state unemployment benefits rose by 19,000 to a seasonally adjusted 316,000 for the week ended Jan. 10, the Labor Department said on Thursday.

Economists polled by Reuters had forecast claims falling to 291,000 last week. The prior week’s data was revised to show 3,000 more claims received than previously reported.

The four-week moving average of claims, considered a better measure of labor market trends as it irons out week-to-week volatility, rose by only 6,750 to 298,000 last week.

Notice that the number of jobless claims is rising–not falling. The article then goes on to imply that this is an indication of a strengthening economy. However, there is something the article fails to mention.

A website called ycharts has posted the following graph:

LaborForceParticipationRateA shrinking labor force is not a sign of a growing economy. Keep in mind that the unemployment rate is only based on the number of people who are in the labor force–therefore the actual unemployment rate may not be the one the government is citing. If the unemployment rate were calculated based on the number of people who are actually out of work and not looking for work, the number would probably be well into the teens. Again, we are being told the economy is strengthening, but that is not necessarily the case.

 

 

The Unemployment Numbers Are Lying And This Is How We Got Here

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On September 5, the Weekly Market Wrap at NASDAQ listed the unemployment rate at 6.1 percent.

The article also reported:

In economic news, in the week ending August 30, the advance figure for seasonally adjusted initial claims (unemployment benefits) was 302,000, an increase of 4,000 from the previous week’s unrevised level of 298,000. The 4-week moving average was 302,750, an increase of 3,000 from the previous week’s unrevised average of 299,750.

So we have an increase of unemployment claims, but an unemployment rate holding steady at 6.1 percent. How does the government do that? Easy–shrink the labor force so the percentage stays the same.

Today’s Washington Examiner reports:

It came as quite a disappointment last Friday when the Labor Department announced that the U.S. economy created only 142,000 net jobs in August. Even worse, this anemic number came with a downward revision of a combined net 28,000 jobs for the previous two months.

Now add to these a third unwelcome piece of news: The U.S. labor force participation rate — that is, the share of working-age Americans who are either working or seeking work — has returned to a multi-decade low of 62.8 percent, down from 65.9 percent before the recession. This number, which has been in a nosedive ever since the 2008 recession began, remains mired at levels that haven’t been seen since women began entering the workforce in large numbers. Fewer Americans are in the labor market today than at any point since 1978.

President Obama is not responsible for what happened before he took office, but his policies have resulted in the failure of the economy to rebound from the 2008 recession.

I apologize for the length of what is to follow, but every now and then I think it is a good idea to remember how we got here.

The recession is not President Obama’s fault; it is not President Bush’s fault; it is not the result of greedy bankers, capitalism, or Wall Street. It is the result of faulty government regulation. The recession was the result of the housing bubble–it’s roots go back to the 1977, when President Jimmy Carter signed into law the Community Reinvestment Act (CRA) passed by Congress. Congress had good intentions–the law was passed to help low-income families buy houses. The idea was to reduce discrimination in housing loans. In 1995 President Clinton modified the law–the idea was to make the paperwork easier to navigate and to make the CRA ratings of banks available to the public. The securitization of CRA loans (including subprime mortgages) began in 1997.  In 1999 Senators Chris Dodd and Charles Schumer worked on legislation that allowed the Federal Deposit Insurance Act  to allow banks to merge or expand into other types of financial institutions. Under pressure from political action groups, banks began issuing more subprime loans–selling them in groups in investment packages along with loans that had a better chance of being paid back.

In October 2000, Fannie Mae announced a pilot plan to purchase $2 billion of “MyCommunityMortgage” loans. The pilot lenders agreed to customize affordable products for low and moderate-income borrowers. There is nothing wrong with the intention here, but it is not a good idea to lend money unless you have a reasonable expectation of getting it back. The increase in loans caused the price of housing to rise faster than the rate of inflation (which is traditionally the rate of the rise of housing costs). Companies began offering ‘interest only’ and ‘variable interest’ loans so that people could make lower payments on larger houses while the value of their houses increased.  Banks were forced to issued subprime mortgages or pay large penalties to the government. Fannie Mae prospered because it made more loans and sold them. It’s executives raked in amazing amounts of money. The companies writing the subprime mortgages wrote sweetheart mortgage loans to their friends in Congress. In 2004, 92 percent of the loans issued by Fannie Mae were variable-interest- rate loans; in 2005, 91 percent were variable-interest-rate loans. Fannie Mae guaranteed the mortgages they granted and sold them to banks and investors. Home ownership and home prices continued to rise. Then, in 2004, interest rates began to rise, and gasoline prices climbed. In 2007 the subprime mortgage market collapsed because low-income families could not pay their mortgages. Foreclosures increased. There were no buyers. Home prices began to drop. By September of 2008, twelve banks had failed during that year because of worthless government securities issued by Fannie Mae.

So did anyone try to stop this runaway train? Yes. In 2003, President Bush proposed legislation to overhaul the housing finance industry. The President wanted to create a new agency within the Treasury Department to oversee Fannie Mae and Freddie Mac. The Democrats in Congress blocked the legislation, saying it might interfere with the ability of low-income families to buy homes. Barney Frank, a Democrat from Massachusetts, stated, “The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing.” Melvin Watt, a Democrat from North Carolina, stated, “…and in the process weakening the bargaining power of poorer families and their ability to get affordable housing.” In 2005, John McCain, a Republican from Arizona, warned of an upcoming mortgage collapse. He sponsored the Housing Enterprise Regulatory Act of 2005 (www.govtrack.us Bill S-190). The purpose of the bill was to regulate Fannie Mae and Freddie Mac. Democrats blocked the bill. The bill was reintroduced in 2007. Again, it was blocked by members of the Senate who had received benefits from the companies involved in the subprime scandal. Senator Chris Dodd, a Democrat from Connecticut, had received a sweetheart loan from one of the companies. Jim Johnson, a key member of the Obama campaign team, also received a sweetheart loan from Countrywide Mortgage. From 1991 through 1998, Jim Johnson was the CEO of Fannie Mae. Johnson received $21 million during his tenure there.

The original intent of the CRA was good. It is a wonderful idea to give everyone an opportunity to buy a home. Unfortunately, the expansion of the CRA had the exact opposite effect. Because the government interfered in the free market, a bubble was created. Expectations of what a house should be changed during that time. In the 1960’s and 1970’s there was the concept of a ‘starter home.’ A starter home was usually a relatively inexpensive small house that was affordable, and the equity gained while living there could be used to buy a larger house after a couple started a family. That concept is gone. Look around. What are people building in your neighborhood? The housing bubble reflected a change in what Americans expect in housing. We have lost our moorings for the sake of conspicuous consumption. There is nothing wrong with owning a large home, but we need to balance our wishes with our income; otherwise, America will drown in personal debt as well as federal debt.

Unions Members Inspecting Non-Union Companies

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Yesterday the Daily Caller reported that union representatives are allowed to accompany OSHA to nonunion work sites due to an Obama administration rule clarification. The clarification has been accused in congressional testimony of violating federal laws.

The article reports:

Union representatives from the Service Employees International Union (SEIU) are now accompanying federal government safety inspectors on site visits to review labor complaints at nonunion private businesses, The Daily Caller has learned.

SEIU and other labor unions can accompany the government inspectors on site visits due to a quiet and contested Obama administration rule clarification issued last year in response to a request from a union representative.

SEIU agents recently accompanied an inspector from the federal Occupational Safety and Health Administration (OSHA), a division of the Department of Labor, on three visits to nonunion work sites under contract with the Houston-based janitorial company Professional Janitorial Services (PJS).

The argument against allowing SIEU and other union member to be involved in OSHA inspections is that it brings into question the neutrality of OSHA in labor-management disputes. Union members have no business being involved in the inspection of a non-union company.

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About Those Unemployment Numbers

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John Crudele at the New York Post has done a number of stories about fraud in the reporting of the unemployment numbers. He posted a story yesterday about the Congressional investigations into this fraud, including an investigation by the House Oversight Committee and Congress’ Joint Economic Committee. He adds that he is also investigating. He is currently waiting for the Commerce Department to comply with a Freedom of Information Act request he has filed for e-mails and text messages between people in the Philadelphia Census office.

The article reports:

At the core of all these investigations is solid evidence that at least one surveyor — a guy named Julius Buckmon, working out of the Philadelphia Census office but polling in Washington, DC — submitted fake household surveys that were used in compiling the Labor Department’s unemployment rate.

Because of the scientific nature of the Labor Department survey, Buckmon’s actions alone would have affected the responses of some 500,000 households.

But as I’ve been reporting, the scam was allegedly much larger than that and included other surveyors (or enumerators as they are called) over many years. And supervisors at least two levels up are said to have known about — and covered up — the scandal.

What the investigators are looking for is that the unemployment numbers were falsified so that they would drop just before the 2012 election. In fact, the unemployment rate did drop before the election.

This is a chart from trading economics.com:

United States Unemployment Rate

Before you get too excited over the fact that unemployment may be dropping, you need to take a look at the labor force participation rate. When people stop looking for jobs, they are no longer counted as unemployed. Therefore, as the number of people who are working drops, the unemployment rate drops. That is not the way it should be, but it is the way it is. The chart below from the Bureau of Labor Statistics shows what has happened to our labor force participation rate since 2009:

laborparticipationrate2014Regardless of whether or not there is fraud involved, our current unemployment numbers are very misleading. Please follow the link above to the New York Post to hear the rest of the story. There is a smoking gun. Unfortunately, the person in charge at the time is claiming that he never saw it.

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Economic Recovery????

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Fox Business reported today that the weekly jobless claims jumped to 368,000 this week.

The article reports:

Initial claims for state unemployment benefits surged 68,000 to a seasonally adjusted 368,000, the Labor Department said on Thursday. That was the largest weekly increase since November 2012. Claims for the prior week were revised to show 2,000 more applications received than previously reported.

No explanation has been given for the jump. The claims report also showed an increase in the number of people collecting benefits. The number jumped 40,000 to 2.79 million in the week ended Nov. 30.

On Sunday I posted an article (rightwinggranny.com) questioning the accuracy of the unemployment numbers we are being given. It is interesting to compare the actual numbers with the numbers being given out during the previous week.

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About Those Jobs Numbers

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John Crudele at the New York Post has posted a few articles raising questions about how the Obama Administration is calculating unemployment numbers. He posted one yesterday. Mr. Crudele has pointed out that unemployment numbers are coming from the Census Bureau and that in 2010 one of its enumerators was caught fabricating interviews.

The article reports:

The Census Department surveys that went into the November jobless rate actually took place during the week that included Nov. 5 instead of the normal Nov. 12 week.

The Labor Department did put in a note about the survey week change in its November report.

But it should also have included another line that said: “The data for the unemployment rate may have been compromised. Lots of people are looking into the matter right now. We’ll get back to you on whether you should believe these numbers or not.”

John Hinderaker posted a story about the jobs numbers at Power Line today.

The article at Power Line includes the following chart:

120613-600x375

The chart shows what has happened to the labor participation rate since 2008–it dropped like a rock and stayed there.

The article at Power Line quotes James Pethokoukis of the American Enterprise Institute:

    1. There are still 1.1 million fewer employed Americans today than right before the recession started, despite a potential labor force that’s 14 million larger. And there are 3.6 million fewer full-time workers than back in 2007.

    2. The employment rate, the share of Americans with a job, is 58.6% — exactly where it was in November 2009.

    3. If the labor force participation rate were where it was a year ago, the jobless rate would be 7.9%, not 7% (and 11.3% if the LFPR were at prerecession levels, though closer to 9% if demographics-adjusted).

The article at Power Line concludes:

Back in the heady days of 2008 and 2009, the Democrats were universally confident that the economy would improve dramatically, as it always does after a recession, regardless of the policies the Democrats followed. All they would need to do was take credit when the time came. The bitter lesson of the last five years is that federal policies do matter. The American economy is diverse and resilient, but if our government’s policies are stupid enough, they can blight the prospects of an entire generation.

If you were planning to break out the champagne because of the 7 per cent unemployment rate, you might want to hold off for a little bit. If you want to turn this around, think before you vote.

 

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Changing The Numbers To Fit The Situation

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Remember when 5 percent unemployment under George W. Bush meant that we were in horrible economic straits? Remember when gas prices hit $3.00 a gallon under George W. Bush and it was the end of the American economy as we knew it? Anyone else long for those days?

We are being told that the unemployment rate is currently hovering around 7 percent. We are also watching the labor participation rate fall to 62.8 percent (Investor’s Business Daily). This puts the true unemployment rate at about 11.8 percent.

Investor’s Business Daily reports:

When the economy fell into recession in December 2007, the jobless rate was 5% and the labor force participation rate was 66%. As job losses surged, unemployment doubled to 10% in October 2009, a few months after the recession officially ended. The jobless rate slowly began to edge down, but held at 9% or above for nearly two years, and above 8% for nearly three years.

But the drop largely reflected job market weakness rather than strength. During this time, labor force participation steadily fell. In October 2009, when official unemployment peaked, participation was 65%. A year later it was 64.4%. Now, more than four years into the expansion, it’s 62.8%, the lowest in 35 years.

But wait–there’s more. The New York Post reported yesterday that Congress will begin an investigation on how unemployment numbers have been calculated and released particularly during the run-up to the 2012 election.

The article at the New York Post reports:

Last week I reported exclusively that someone at the Census Bureau’s Philadelphia region had been screwing around with employment data. And that person, after he was caught in 2010, claimed he was told to do so by a supervisor two levels up the chain of command.

On top of that, a reliable source whom I haven’t identified said the falsification of employment data by Census was widespread and ongoing, especially around the time of the 2012 election.

In 2009, before the 2010 census was taken, the White House changed the rules on how the census would be reported. The Census Bureau would report to senior White House aides. I will admit that at the time I thought this would result in some population statistics being altered to increase the number of votes in blue states and decrease the number of votes in red states. It didn’t occur to me at the time that these numbers could also be used to skew unemployment data.

The New York Post continues:

Back in 2010, I started getting reports that the Census Bureau had some very unusual hiring practices. Census takers and supervisors — at risk of heavy fines — were reporting to me that large numbers of people were being hired only to be fired shortly afterward. And then rehired.

I theorized at the time that Census was trying to make the job-creation totals look better nationwide in those bleak months leading up to the midterm congressional elections.

This employment policy seemed too coordinated. The regional higher-ups at Census couldn’t be doing this on their own; there had to be a grander plan.

I still don’t know what was going on.

But then I heard about the falsification in Philly. This time, however, it wasn’t the employment numbers that were being doodled with. This time it was the unemployment data, which are gathered at the Census Bureau and handed over raw to the Labor Department.

Please follow the link and read the entire story. Unfortunately most of the media is unaware of this or ignoring it. As voters, all of us need to be aware of what is taking place here.

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Improper Unemployment Payments

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Yesterday CNS News posted a story about $5,159,629,434 in improper unemployment insurance payments for all 50 states, U.S. territories and the District of Columbia for the period July 1, 2011 to June 30, 2012.

The data is included in a chart on the Department of Labor (DOL) website.

The article reports:

The DOL outlines its “core strategies to reduce improper payments” and other actions it is taking to improve performance at the state level, including providing funding to the states.  (See TOP Document.pdf )

“On Sept. 27, 2012 the Department announced the award of approximately $169 million in supplemental budget requests (SBRs) to 33 states for projects related to program integrity and performance to address their root causes most likely to quickly reduce improper payments.”

I don’t think fraud is the biggest problem with unemployment insurance. Now that unemployment benefits can be collected for more than a year, how much incentive do people have to look for work during that year? The fraud in the payments needs to be addressed, but so does the length of time benefits can be collected. I understand that the economy is not creating jobs, but does extending the amount of time people can collect money for being unemployed actually help the economy,  the unemployment rate, or those people looking for jobs.

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The Week After

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Investors.com posted an article yesterday listing the things we have learned about the economy since last week’s election. It’s not a pretty list.

This is a chart from the article:

Some of the highlights are lower earnings, increased poverty, jobless claims increasing, inflation creeping up, coal plants closing, food stamp enrollment climbing rapidly and small banks going out of business.

What a mess President Obama has inherited from his predecessor.

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Be Careful What You Believe Between Now And the Presidential Election

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Yesterday Fox Business posted an article about the jobless claims data reported this week.

The article reports:

A sharp drop in the number of weekly jobless claims filed last week was caused by the failure of one large state to report all of its claims, a Labor Department spokesman confirmed to FOX Business.

Initial jobless claims, which are a measure of the number of people recently laid off, fell by 30,000 to a seasonally adjusted 339,000, the lowest level in more than four years.

But the Labor Department spokesman said the numbers were skewed by one large state that underreported its data. The spokesman declined to identify the state, but economists believe California is the only state large enough to have such a significant impact on the overall numbers.

Evidently, the state that did not report their numbers forgot to include that stockpile of unprocessed claims in their tally for this week (which is the first week of a new calendar quarter),

This is the equivalent of saying all of your bills are paid because you are haven’t gotten to the pile of bills you left on the kitchen table. We are truly in the silly season and need to discount at least ninety percent of what we read or hear from the media. Just for the record, the number will be revised upward, but at a time when no one is paying attention.

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Where Did The Wonderful Unemployment Numbers Come From ?

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Paul Mirengoff posted an article at Power Line explaining the sudden wonderful drop in the unemployment numbers released today.

The article reports:

But there’s a problem with the report: it doesn’t make sense. As Kevin Hassett points out, the 114,000 net jobs created in September is well below the average for this year (146,000) and the average for last year (153,000).

So how did the Department of Labor come up with an unemployment rate that indicates significant improvement in the jobs picture? It found the alleged improvement through its survey of households. As Hassett explains, the Labor Department’s jobs report is always based on two surveys, one of households and one of establishments.

Professional economists and the press usually emphasize the establishment survey because it is considered less volatile. This month, that survey continues to show the usual weakness in the job market. But the household survey purports to show massive improvement.

This sort of mathematical trickery was totally predictable to anyone who understands President Obama’s roots in Chicago politics. Over the next four weeks, we may actually be told that there is no unemployment actually remaining in America. These numbers are about as reliable as your teenage son telling you that there was a unicorn standing in the middle of the highway, and traffic slowed to a crawl to avoid an accident so he was late getting home.

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News That Really Does Not Make Me Happy

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Bloomberg reported yesterday that incomes in America declined more in the three year expansion since 2009 than during the longest recession since the Great Depression. The ‘great recession’ in America officially ended in 2009. There is a technical definition of a recession, and according to that definition, the recession in America ended in 2009. However, the income and unemployment numbers for Americans have not improved.

The article reports:

“Almost every group is worse off than it was three years ago, and some groups had very large declines in income,” Green (Gordon Green, Sentier Research LLC.), who previously directed work on the Census Bureau’s income and poverty statistics program, said in a phone interview today. “We’re in an unprecedented period of economic stagnation.”

While gains in hourly earnings and average hours worked per week may have had “a minor mitigating effect” on income declines, they couldn’t offset a jobless rate that hasn’t fallen below 8 percent since February 2009 and a record duration of unemployment, according to the Annapolis, Maryland-based firm.

The average duration of unemployment increased to a record 41 weeks in November and remains at 39 weeks, Labor Department data show. Almost 5.2 million Americans have been out of work for at least six months.

This snapshot of the economy does not bode well for the re-election chances of Barack Obama.

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Politicizing Every Part Of Government

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One of the most distressing aspects of the Obama Administration has been the politicization of every area of government. The Department of Justice dropped prosecution of an obvious voter intimidation case, the National Labor Relations Board tried to stop a company from opening a manufacturing facility in a non-union state, and the Department of Justice’s involvement in Fast and Furious is still being uncovered. The latest example of this sort of playing politics with things that should not be political has to do with the impact of the defense cuts the Obama Administration has caused by refusing to engage in serious budget negotiations.

Yesterday Investors.com posted an article explaining the government’s interference in the enforcement of the WARN law. The article reports:

Federal law under the WARN (Worker Adjustment and Retraining Notice) Act required employers to give workers a minimum of 60 days notice before potential mass layoffs.

Because of sequestration, quite a few people who work for companies related to the defense industry will be getting layoff notices just before the November election. Many of those people live in swing states with electoral votes the President needs to win the election.

The article reports:

To avoid the electoral consequences of these cuts, the Department of Labor (DOL) is informing defense contractors that since sequestration hasn’t actually happened yet, and some in Congress are trying to find ways around it, it might be nice if they didn’t obey federal law and send out the pink slips just this once.

I don’t want sequestration to take effect, but as of now, it will happen. Therefore, the law should be followed, regardless of electoral consequences.

The article concludes:

“Sequestration is currently the law of the land, and our nation’s workers have a right to know how these sequestration cuts which begin in January may impact them,” Sen. McCain noted.

They deserve to know when they’re about to lose their jobs, and that President Obama did it for them. So do the voters.

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The Power Of The New Media

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Image of a family farm near Stockbridge, Wisco...

Image of a family farm near Stockbridge, Wisconsin, United States Espanol: un granja de la familia en Stockbridge, Wisconsin, Estados Unido (Photo credit: Wikipedia)

Yesterday’s Daily Caller posted an article showing the power of the Internet and the new media. (Note: I suspect what happened in this case is the result of the fact that it is an election year.)

On Wednesday I posted an article about new farm regulations which will severely limit the activities of children on the family farm (rightwinggranny). I wasn’t the only one who was concerned about the regulations–the Daily Caller article I sourced made it to facebook, the Drudge Report, and other social media.

The results:

Under pressure from farming advocates in rural communities, and following a report by The Daily Caller, the Obama administration withdrew a proposed rule Thursday that would have applied child labor laws to family farms.

Score one for the good guys! However, don’t get too confident. If Obama wins a second term and has more flexibility in his policies (as he told Russian leader Dmitri Medvedev recently), these regulations may magically reappear.

Meanwhile, we can celebrate at least a temporary victory.

 

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Undermining The Family And The Work Ethic All At Once

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A farm, Bethel, Vt. (LOC)

A farm, Bethel, Vt. (LOC) (Photo credit: The Library of Congress)

You have to hand it to the federal government–they sure know how to ruin things. Today’s Daily Caller posted an article about the farm regulations about to be put in effect by the Obama Administration’s Department of Labor. The new laws would apply child labor laws to children working on family farms.

The article reports:

Under the rules, children under 18 could no longer work “in the storing, marketing and transporting of farm product raw materials.”

“Prohibited places of employment,” a Department press release read, “would include country grain elevators, grain bins, silos, feed lots, stockyards, livestock exchanges and livestock auctions.”

The new regulations, first proposed August 31 by Labor Secretary Hilda Solis, would also revoke the government’s approval of safety training and certification taught by independent groups like 4-H and FFA, replacing them instead with a 90-hour federal government training course.

This is ridiculous.

One person related his experience of working on a relative’s farm during the summer and how it impacted him:

John Weber, 19, understands this. The Minneapolis native grew up in suburbia and learned the livestock business working summers on his relatives’ farm.

He’s now a college Agriculture major.

“I started working on my grandparent’s and uncle’s farms for a couple of weeks in the summer when I was 12,” Weber told TheDC. “I started spending full summers there when I was 13.”

“The work ethic is a huge part of it. It gave me a lot of direction and opportunity in my life. If they do this it will prevent a lot of interest in agriculture. It’s harder to get a 16 year-old interested in farming than a 12 year old.”

Weber is also a small businessman. In high school, he said, he took out a loan and bought a few steers to raise for income. “Under these regulations,” he explained, “I wouldn’t be allowed to do that.”

The federal government is interfering with a farm family’s right to teach their children a work ethic and the basics of farming. The government is also interfering with organizations like 4-H and FFA, which build a sense of community among the children who grow up on farms or are interested in farming.

This is simply the government getting involved where it does not need to get involved. The new laws will not accomplish anything except disrupt a system that works. The federal government needs to learn to heed the words ‘if it ain’t broke don’t fix it.‘ That would probably solve a major percentage of the America’s problems–financial and otherwise. 

 

 

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How’s That Green Jobs Thing Working For You ?

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Breitbart.com reported yesterday that President Obama’s ‘green jobs‘ initiative has not worked very well. The source of their story was a Reuters story that had been posted on Friday.

Since 2009, although the energy capacity of wind farms has almost doubled, the industry has lost 10,000 jobs. During that same time period, the oil and gas industry have created 75,000 jobs.

Reuters reports:

The program’s (the $500 million job-training program that aims to train workers for skills they would need in a new “green economy“) initial results were so poor that the Labor Department‘s inspector general recommended last fall that the agency should return the $327 million that remained unspent.

The numbers have improved somewhat since then, but the department remains far short of its goal of placing 80,000 workers into green jobs by 2013.

By the end of 2011, some 16,092 participants had found new work in a “green” field, according to the Labor Department – roughly one-fifth of its target. The program also helped employed workers upgrade their skills.

At some point are we going to stop wasting taxpayer money on things that don’t work? This is a glaring example of a place where the federal budget could be seriously cut without endangering anyone’s existence.

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