Category Archives: Unemployment

While the Senate Takes a Break, Four Thousand FAA Employees are Furloughed

23 Saturday Jul 2011

Posted by in Congress, Politics, Unemployment

≈ Leave a comment

Tags

, , , , , , ,

Dysfunctional government marches on. While the Senate takes a break, 4,000 FAA employees are now furloughed without pay:

“The Federal Aviation Administration (FAA) partially shut down Saturday, as Congress failed to reauthorize the agency’s funding.

“I’m very disappointed that Congress adjourned today without passing a clean extension of the FAA bill,” Transportation Secretary Ray LaHood said in a Friday statement. “Because of their inaction, states and airports won’t be able to work on their construction projects, and too many people will have to go without a paycheck. This is no way to run the best aviation system in the world.”

About 4,000 FAA employees are now furloughed without pay, according to the FAA, as the Senate on Friday failed to approve a controversial House-passed extension of taxes that help fund the FAA.”

That kind of careless inaction couldn’t possibly be responsible for this, could it?

“A new CNN poll finds that 55 percent of voters have a negative view of the Republican Party, tied for their second-highest unfavorable score since CNN began asking this question in 1992…The news for Democrats is not any better. Some 49 percent of voters now hold a negative view of the party, according to the poll. Although this figure is slightly better than for Republicans, it matches the Democrats’ record high unfavorable rating of September 2010 and is part of an upward trajectory that has persisted for the past three years.

The combined unfavorable score for both parties — 104 percent — is also a record, and represents the first time that the figure has been above 100.”

A well-deserved record. May the fleas of a thousand camels infest all their nether regions.

All the Bad News That Fits

23 Saturday Jul 2011

Posted by in Afghanistan, budget, Congress, economy, Iraq, Medicaid, Medicare, Obama, Politics, Social Security, Unemployment, Wall Street

≈ 1 Comment

Tags

, , , , , , , , , , , , , , , , , , ,

“I met a girl who sang the blues, and I asked her for some happy news. She just smiled and turned away.”

In the latest episode of “As the Debt Ceiling Turns”; Boehner walks, Obama has a hissy fit, and Pelosi throws yet another plan into the mix:

“House Minority Leader Nancy Pelosi acknowledged Friday that Democrats may reluctantly accept a last-minute compromise to avoid a default that involves up to $2.5 trillion in spending cuts — without agreed-upon new tax revenues — if Medicare, Medicaid, and Social Security are protected from the debt limit brinksmanship.”

Yes, by all means, let’s cut spending. Never mind this:

“Companies are laying off employees at a level not seen in nearly a year, hobbling the job market and intensifying fears about the pace of the economic recovery.

Cisco Systems Inc., Lockheed Martin Corp. and troubled bookstore chain Borders Group Inc. are among those that have recently announced hefty cuts, while recent government numbers underscore how companies have shifted toward cutting jobs.

The increase in layoffs is a key reason why the U.S. recorded an average of only 21,500 new jobs over the past two months, far below the level needed to bring down unemployment, which now stands at 9.2%.”

Or this:

“Initial weekly unemployment claims increased to 418,000. The 4 week moving average is 421,250. A weekly average above 400,000 does not indicate job growth and we now have a pattern of perpetual disaster for U.S. citizens trying to earn a living.”

About that default deadline, is it August 2, August 10, or August 15? Nobody seems to know for sure.

The Money Party has some questions and answers on Obama’s handling of the budget never let a good crisis go to waste. Here’s just one:

“Question:  Why did President Obama put Social Security and Medicare on the table in the budget negotiations when 80% of the people oppose cuts to these programs?

Answer:  The president is not in office to represent those people.  He was selected, funded and carried over the finish line by corporate America.  Look at the appointment of Wall Streeter Timothy Geithner, the bailouts, and the failure to prosecute any of the crooks who caused the current recession. He’s serving the people who put him in office.  Those people don’t need Social Security and Medicare.”

Not only serving the people who put him in office, but serving those who he is depending on to keep him there:

“Among big fundraisers, Obama has drawn close to a third of his money from people in the finance industry, up from 20% during his 2008 campaign, according to an analysis by the Center for Responsive Politics.

The amount raised so far is more than two-thirds what Wall Street elites helped Obama raise in his entire 2008 campaign. And it is enough to make the finance world the single largest source of big-ticket donations for Obama.”

While we cut the social safety net out from under our most vulnerable at home, billions are going unaccounted for in Afghanistan:

“SIGAR [Special Inspector General for Afghanistan Reconstruction] found that U.S. agencies have limited visibility over U.S. cash that enters the Afghan economy — leaving it vulnerable to fraud and diversion to the insurgency…”SIGAR auditors found that U.S. agencies have not done all they can to safeguard U.S. funds, and the Afghan government has not provided the cooperation needed to build a strong, secure financial system.”

Also on the Endless War front, the State Department is telling the Special Inspector General in Iraq to mind his own business when it comes to State’s mercenary army in that country:

“By January 2012, the State Department will do something it’s never done before: command a mercenary army the size of a heavy combat brigade. That’s the plan to provide security for its diplomats in Iraq once the U.S. military withdraws. And no one outside State knows anything more, as the department has gone to war with its independent government watchdog to keep its plan a secret.

Stuart Bowen, the Special Inspector General for Iraq Reconstruction (SIGIR), is essentially in the dark about one of the most complex and dangerous endeavors the State Department has ever undertaken, one with huge implications for the future of the United States in Iraq. “Our audit of the program is making no progress,” Bowen tells Danger Room.

For months, Bowen’s team has tried to get basic information out of the State Department about how it will command its assembled army of about 5,500 private security contractors. How many State contracting officials will oversee how many hired guns? What are the rules of engagement for the guards? What’s the system for reporting a security danger, and for directing the guards’ response?

And for months, the State Department’s management chief, former Ambassador Patrick Kennedy, has given Bowen a clear response: That’s not your jurisdiction. You just deal with reconstruction, not security. Never mind that Bowen has audited over $1.2 billion worth of security contracts over seven years.”

To be continued…unfortunately.

Obama Hearts the “Gang of Six” Plan

20 Wednesday Jul 2011

Posted by in budget, Congress, economy, health care, Medicaid, Medicare, Obama, Politics, Social Security, Taxes, Unemployment

≈ 2 Comments

Tags

, , , , , , , , , , , , , ,

President Obama was quick to endorse the latest deficit reduction plan, the one from the so-called “Gang of Six” released yesterday, calling it a “very significant step” and “broadly consistent with the approach he has advocated.” This without knowing the details. But the details weren’t really important, because all the major elements are indeed consistent with what the president wants in this deficit reduction shell game.

* Medicare, Medicaid, and Social Security cuts.
* Further cuts in the top marginal income tax rates. (So much for that pledge to let the Bush tax cuts expire).
* Corporate tax cuts.
* The continuation of Reaganomics and Bushonomics. That would be the supply-side, tax cuts equals increased revenue and economic growth nonsense that we all know works so well.

The broad strokes of the “Gang of Six” plan (and just as an aside I wonder why Sen. Sanders is never included in any of these gangs? Not bi-partisany enough, I assume) are as follows:

An immediate $500 billion “down payment” on deficit reduction. All spending cuts, all from unnamed programs. A brilliant idea in a recession. The other $3.2 trillion in savings would be decided by various committees at some later date, enforced by spending caps. Congress would be required to get a 2/3 vote to exceed those caps. IOW, when the next recession hits, anybody looking for any assistance is SOL. David Dayen at Firedoglake:

“Simply put, this is a recipe for depression. When the economy suffered and stimulus would be required to increase aggregate demand, the 2/3 vote needed would simply put a stop to it. The New Deal would have been out of order under this regime. Same with the Recovery Act. Any spending from the federal government would be restricted as much as it is in the states. So there could only be the status quo or contraction in fiscal policy in the event of a recession, which is a perfect way to create a depression.”

Also in the down payment would be the institution of chained CPI, aka a cut in SS benefits, and repeal of the CLASS Act, which was a part of health care reform that the insurance lobby fought tooth and nail. From the New York Times, December of 2009:

“The Class Act, which the late Sen. Ted Kennedy considered his legacy, would allow people to buy long-term care insurance through payroll deductions and to receive cash if they’re later disabled, regardless of their age or of a previous health condition. “This is the best chance the baby boomers have to protect themselves from impoverishment if they need long-term care,” Mr. [Jim] Firman [president of the National Coalition on Aging] said.”

That is Part One. Part Two calls for an additional $200 billion in “healthcare savings,” aka Medicare and Medicaid cuts, and an $80 billion cut in the defense budget. That’s $80 billion over ten years, pocket change for the Pentagon. Gotta love that shared sacrifice.

In Part Two, the Finance Committee…

“…would be required to reduce tax rates to three tax brackets of rates: of 8-12 percent, 14-22 percent and 23-29 percent. The current top marginal rate is 35 percent. The corporate tax rate would be between 23 percent and 29 percent…”

And this little goodie for corporations as well:

“…tax reform would cease taxation of overseas profits.”

The corporate behemoths had been lobbying to get the tax on overseas profits reduced, allegedly under the guise of returning these profits for use in job creation, but that’s not how it worked before:

“Congress and the Bush administration gave companies a similar tax incentive, in 2005, in hopes of spurring domestic hiring and investment.

While the tax break lured 800 companies into bringing $312 billion back to the United States, 92 percent of that was used for dividends and stock buybacks, according to the nonpartisan National Bureau of Economic Research. The study concluded the program “did not increase domestic investment, employment or research and development.”

Indeed, 60 percent of the benefits went to 15 of the largest U.S. multinational companies — many of which laid off domestic workers, closed plants and shifted even more profits and resources abroad in hopes of cashing in on the next repatriation holiday.”

So let’s just eliminate the tax entirely. Nice.

More on the tax “reform” aspects of this plan:

“Coburn said the plan would reduce the deficit by $3.7 trillion over the next 10 years and increase tax revenues by $1 trillion by closing a variety of special tax breaks and havens. He also noted, however, that the Congressional Budget Office would score the plan as a $1.5 trillion tax cut because it would eliminate the Alternative Minimum Tax.”

I’m not sure how that works. How is $1 trillion in revenue increases scored as a $1.5 trillion tax cut? But I know for sure how this works, it doesn’t:

“It would generate a significant amount of revenue out of tax reform and reduction of tax rates, which authors believe would spur economic growth.”

And I believe in the Tooth Fairy and the Easter Bunny.

9.2% Unemployment is Fiction, 16.2% is Reality

19 Tuesday Jul 2011

Posted by in economy, Politics, Unemployment

≈ 1 Comment

Tags

, , , , , , ,

Economic Populist has a graph showing why the “official” unemployment rate of 9.2% should be disregarded as a disingenuous statistic intended to make the unemployment picture look better than it actually is, and why the U6 rate of 16.2%—which includes unemployed, underemployed, and those who have given up looking—is a much more accurate indicator:

“JOLTS stands for Job Openings and Labor Turnover Survey. The July 12th report on May 2011 data shows there were 4.68 official unemployed people hunting for a job to every position available.

If one takes the…broader definition of unemployment, or U6, in May at 15.8%, the ratio becomes even worse, 8.28 unemployed people per each job opening for May. Bear in mind U6 jumped to 16.2% in June. Below is the graph of number of unemployed, using the broader U6 unemployment definition, per job opening.


Here’s proof:

“Some 16,837 people showed up at the local Kentucky Office of Employment & Training in the past week seeking jobs at Ford’s Louisville Assembly Plant.

The deadline was today to submit an application and a lottery tomorrow picks who gets to go on for consideration by Ford for the jobs paying $15.51 per hour. The number who’ll advance via the lottery wasn’t disclosed.

Sadly, the odds are that very few of these folks will become one of the 1,800 more workers Ford says it needs to reopens the plant in November…”

16,837 people divided by 1,800 openings comes out to roughly 9.3 applicants per job. A lot closer to 8.28 that 4.68.

Confidence, Schmonfidence

18 Monday Jul 2011

Posted by in economy, Unemployment

≈ 2 Comments

Tags

, , , , , , , , , , , , ,

Whenever I see a discussion about the real crisis this country faces—that would be unemployment, not the manufactured one over the deficit– a couple of words keep coming up from the alleged smartest guys in the room, confidence and certainty. Businesses would hire, so it’s said, if they had either or both.

President Obama referred to it in a recent press conference:

“What we need to do is to restore business confidence and the confidence of the American people that we’re on track — that we’re not going to get there right away, that this is a tough slog, but that we still are moving forward.”

It came up again yesterday in a roundtable discussion about jobs on Meet the Press. Just as an aside, two members of this roundtable were Ohio Governor John Kasich and Honeywell CEO David Cote. It has been estimated that Kasich’s budget cuts in Ohio could lead to over 50, 000 layoffs. Mr. Cote’s history at Honeywell, where his 2010 compensation topped $20 million, has been one of outsourcing and union-busting. Just the two opinions you want on what to do about unemployment, right?

Mr. Kasich and Mr. Cote, who also sits on the board at JP Morgan Chase, spoke about the need for businesses to have certainty. Certainty about taxes and regulation. Certainty meaning lower taxes and less regulation, naturally.

In August of 1934, President Franklin Roosevelt addressed the same issues we face today. Here’s what FDR had to say about confidence:

“In one year and five months, the people of the United States have received at least a partial answer to their demands for action; and neither the demand nor the action has reached the end of the road.

But, my friends, action may be delayed by two types of individuals. Let me cite examples: First, there is the man whose objectives are wholly right and wholly progressive but who declines to cooperate or even to discuss methods of arriving at the objectives because he insists on his own methods and nobody’s else.

The other type to which I refer is the kind of individual who demands some message to the people of the United States that will restore what he calls “confidence.” When I hear this I cannot help but remember the pleas that were made by government and certain types of so-called “big business” all through the years 1930, 1931 and 1932, that the only thing lacking in the United States was confidence.

Before I left on my trip on the first of July, I received two letters from important men, both of them pleading that I say something to restore confidence. To both of them I wrote identical answers: “What would you like to have me say?” From one of them I have received no reply at all in six weeks. I take it that he is still wondering how to answer. The other man wrote me frankly that in his judgment the way to restore confidence was for me to tell the people of the United States that all supervision by all forms of Government, Federal and State, over all forms of human activity called business should be forthwith abolished.

Now, my friends, in other words, that man was frank enough to imply that he would repeal all laws, State or national, which regulate business—that a utility could henceforth charge any rate, unreasonable or otherwise; that the railroads could go back to rebates and other secret agreements; that the processors of food stuffs could disregard all rules of health and of good faith; that the unregulated wild-cat banking of a century ago could be restored; that fraudulent securities and watered stock could be palmed off on the public; that stock manipulation which caused panics and enriched insiders could go unchecked. In fact, my friends, if we were to listen to him and his type, the old law of the tooth and the claw would reign in our Nation once more.

The people of the United States will not restore that ancient order. There is no lack of confidence on the part of those business men, farmers and workers who clearly read the signs of the times. Sound economic improvement comes from the improved conditions of the whole population and not a small fraction thereof.

Those who would measure confidence in this country in the future must look first to the average citizen.”

Confidence, schmonfidence. Businesses don’t need either confidence or certainty, they need customers. Those would-be customers need jobs. We’ve had 30+ years of low taxes and less regulation. If those were the engines of job creation we’d have more jobs than we do people.

Remember Unemployment?

15 Friday Jul 2011

Posted by in budget, economy, Unemployment

≈ Leave a comment

Tags

, , , , , , , , , ,

I know it’s not high on our elected officials’ priority list right now, if it’s even on the list at all, but it’s still around. A little thing called unemployment. Remember that? A few statistics the actors in the debt ceiling soap opera might want to consider during a break from their bickering:

The official unemployment rate, the one juggled to make things look better than they actually are, is currently 9.2%. But that’s just the tip of the iceberg. Not counted in that number are the 8.6 million who are working part-time when they’d rather have full-time work, and the 4 million who have given up looking. Add those to the mix and the number goes to 16.2%,

“As of May, 6.2 million had been out of work for more than six months and more than 4 million haven’t work in more than a year…Of those who had been unemployed for more than six months, slightly more than 10% found new jobs. Nearly 19% dropped out of the workforce.”

Almost twice as likely to drop out of the work force than find a job. How sad is that?

The average duration of unemployment is 40 weeks (click to enlarge):

The number of people not in the labor force is at an all-time high:


The employment to population ratio is at its lowest point since the early 1980’s:


If that wasn’t bad enough, state and local governments may cut nearly 500,000 more jobs by the end of this year.

For those fortunate enough to find a job, that job is likely to pay less than what they had.

“Middle income jobs have been replaced by low-income jobs, which now make up 41% of total employment.”

Employee compensation relative to GDP is at its lowest point in over 50 years:


Meanwhile:

“U.S. workers averaged $46,742 in 2010, up 2.6% from 2009. A June GovernanceMetrics analysis found average compensation among S&P 500 CEOs rose to $12 million in 2010, up 18% from 2009 — and that’s not counting the potential multimillion-dollar value of stock or stock options, which are granted at set prices and provide holders profits as stock values rise.”

We now return you to the regularly scheduled debt ceiling theatrics, joined in progress.

Unemployment Numbers Don’t Matter? Wanna Bet?

12 Tuesday Jul 2011

Posted by in economy, Obama, Politics, Unemployment

≈ 1 Comment

Tags

, , , , ,

What was that again, Mr. Plouffe? People won’t vote based on the unemployment rate?

“A slipping economy has Floridians moving away from President Barack Obama and warming up to Republican Mitt Romney, a Sunshine State News Poll shows.

The survey of 1,000 likely voters shows that 54 percent disapprove of the job Obama is doing while just 38 percent approve. That result tracks with Florida voters’ sour view of the economy, with 56 percent saying it has worsened in the past year.

“Clearly, the bleak economic landscape is not good news for Obama. This is quite sobering when you consider that the recession technically ended in summer of 2009, which really shows that people don’t believe we are out of the woods by any stretch,” said Jim Lee, president of Harrisburg, Pa.-based Voter Survey Service, which conducted the poll for Sunshine State News.

Today’s numbers may be even worse for Obama, considering that the July 5-7 survey concluded a day before the latest jobless figures were released last Friday. The national unemployment rate rose again to 9.2 percent as the economy added just 18,000 jobs in June.

“Obama’s negative job approval shows there is a major opening for the GOP to win the state in 2012, particularly when you consider that Obama only won by a close 51-48 margin last time,” Lee said. “No president since FDR has won re-election when the unemployment rate on Election Day topped 7.2 percent.”

Economists calculate that the economy would have to add a whopping 250,000 jobs every month for the next year to drive the unemployment rate below 7.5 percent.”

You might want to re-think that re-election strategery, Fluffy.

Why Is This So Damn Difficult?

09 Saturday Jul 2011

Posted by in Afghanistan, budget, economy, Iraq, Medicare, Obama, Politics, Social Security, Taxes, Unemployment, Wall Street

≈ Leave a comment

Tags

, , , , , , , , , , , , , , , , , , , ,

This is so simple it’s ridiculous. The three major causes of the dramatic increases in debt and deficit are:

1) The Bush, now Obama, tax cuts.

2) The wars in Iraq and Afghanistan.

3) The financial collapse caused by Wall Street greed.

Ending the tax cuts just for those making over $250,000 will bring in $700 billion over 10 years. The wars cost about $140 billion a year. End both and we save $1.4 trillion over the same 10-year period. A financial transaction tax of just one quarter of one percent will result in $150 billion a year, $1.5 trillion over 10. There’s $3.6 trillion over 10 years, which is just about the same amount the debt ceiling dealers are talking about cutting spending. And we haven’t touched Social Security, Medicare, Medicaid, education, etc. Yet none of these three are even on the debt ceiling/spending cut/revenue increases negotiating table. Why?

The American Society of Civil Engineers estimates the cost of repairing our crumbling infrastructure to be $2.2 trillion over 5 years. Do you see where I’m going here? Take the money we’ve saved, not from cutting the safety net out from under our most vulnerable who had nothing to do with the debt explosion and who did not benefit from it, but from the root causes and from those who did.

The result is millions of Americans have jobs. They’re paying income taxes, Social Security taxes, Medicare taxes. They no longer need unemployment, food stamps, or other forms of government assistance. They’re buying stuff, which creates demand for stuff, which creates more jobs, which creates more demand for stuff. And so on, and so on, and so on. Why is this so damn difficult?

But what do we get from our “leaders?” Gobbledegook and gibberish. Like President Obama’s remarks yesterday after the release of the horrible job numbers. Things like streamlining the patent process, advancing more so-called free trade agreements (which costs jobs rather that create them) and this:

“[T]o put our economy on a stronger and sounder footing for the future, we’ve got to rein in our deficits and get the government to live within its means, while still making the investments that help put people to work right now and make us more competitive in the future.

The sooner we get this done, the sooner that the markets know that the debt limit ceiling will have been raised and that we have a serious plan to deal with our debt and deficit, the sooner that we give our businesses the certainty that they will need in order to make additional investments to grow and hire and will provide more confidence to the rest of the world as well..”

Beside the fact that this is straight of the Republican playbook for economic growth, it’s nonsense (but I’m being redundant). Live within our means while making investments? What the hell is that? Give businesses the certainty they need? Businesses don’t need certainty, they need customers. Customers create jobs, not the ever-elusive confidence unicorn. Why is this so damn difficult?

The president’s mouthpiece at the Council of Economic Advisers, Austan Goolsbe offered more of the same:

“Today’s report underscores the need for bipartisan action to help the private sector and the economy grow – such as measures to extend the payroll tax cut, pass the pending free trade agreements, and create an infrastructure bank to help put Americans back to work.  It also underscores the need for a balanced approach to deficit reduction that instills confidence and allows us to live within our means without shortchanging future growth.”

*Sigh* Can’t anybody here play this game?

Unemployment Rises to 9.2%

08 Friday Jul 2011

Posted by in Unemployment

≈ Leave a comment

Tags

, , , ,

From this morning’s New York Times:

“The United States economy added a meager 18,000 jobs in June, up from a gain of a revised 25,000 jobs in May, the Department of Labor said on Friday. The unemployment rate rose to 9.2 percent in June from 9.1 percent in May, the department said.

[…]

The report said that 14.1 million people were out of work in June, among them 6.3 million who have been jobless for six months or longer. In May, the total number of unemployed people was reported as 13.9 million, with the long-term unemployed at 6.2 million.

[…]

The Labor Department said that following gains that averaged 215,000 jobs per month from February through April, employment has been “essentially flat” for the past two months.”

By strange coincidence, right about the time that cutting spending, belt-tightening, and austerity became the order of the day. Couldn’t be any correlation between the two, could there? But never mind, it’ll have no influence whatsoever on the 2012 election. Fluffy said so.

The Real Victims of Austerity

06 Wednesday Jul 2011

Posted by in Politics, Unemployment

≈ Leave a comment

Tags

, , , , ,

Those who can least afford it:

“Millions of Floridians head back to work Tuesday after a restful three-day Fourth of July weekend. But Toni Gugliotta won’t be among them. She’ll be applying for $275 a week in unemployment benefits instead. The Pinellas County woman is among 1,300 state employees put out of work by the new budget approved by the Legislature and signed into law by Gov. Rick Scott on May 26.

Scott kept his promise to reduce the size of the state government bureaucracy. But he did so at the expense of real people with mortgages, healthcare bills, college tuition payments and credit card payments. Many of them earned less than $30,000 a year after years of state employment.

To them, the Scott mantra “Let’s get to work” rings hollow. They now join the hordes of Floridians looking for work in a state with an unemployment rate that, while declining, remains in double digits at 10.6 percent.

The state agencies that took the biggest hits are the Department of Juvenile Justice and the Department of Children and Families, which together account for most of the layoffs.”

Nice job, Florida. Elect another Medicare fraud artist as governor.