Don's Tuesday Column

THE WAY I SEE IT   by Don Polson  Red Bluff Daily News   8/11/2015

    Obama lies—let bad policies die

 Among the impediments to having a truthful understanding America’s economy and employment situation, no small role is played by the provable lying by Emperor Obama. Particularly insightful is “Obama Tells Another ‘Whopper’—He Did Not Create 12.8 Million Jobs,” by David Stockman, President Reagan’s head of the Office of Management and Budget (Attention, liberals: bashing Stockman or Reagan disproves nothing).

To the reliably higher-ed-addled, uncritical brains of University of Wisconsin students, Obama said, on July 1: “And the unemployment rate is now down to 5.3 percent. (Applause) Keep in mind, when I came into office it was hovering around 10 percent. All told, we’ve now seen 64 straight months of private sector job growth, which is a new record—(applause)—new record—12.8 million new jobs all told.”

Stockman describes that as “a pack of context-free factoids,” and reasonably castigates “economically illiterate hacks—like those who work on the White House speech writing staff.” For the crass purpose of inflating numbers, they ignore the normal business cycle, with its peaks and troughs, and measure from a convenient point—the bottom of the V-shaped but momentary employment trough early in Obama’s tenure.

“We are now 29 quarters from the pre-crisis peak and total non-farm labor hours utilized by the U.S. economy are no higher than they were in Q4 2007…In other words, if you use a common unit of measure—labor hours rather than job slots which treat coal-miners and part-time pizza delivery boys alike—there have been no new units of employment at all.” (Stockman) That’s about 6 and-a-half years since pre-recession normalcy; Obama’s economic recovery has yet to exceed those labor conditions.

He finds, moreover, that the employment picture is only 1 percent better now than 2 cycles ago, in the spring of 2000. That compares unfavorably to the same time period after the 1990 peak—a 12 percent increase in non-farm labor hours—and after the 1981 peak with a 17 percent increase in non-farm hours.

“What is happening is that the Keynesian money printers at the Fed are fueling serial financial bubbles. This generates a temporary lift in the discretionary incomes of the top 10 percent of households, which own 85 percent of the financial assets, and the next 10-20 percent which feed off their winnings.” Hence, leisure and hospitality jobs for bar tenders, waiters, bellhops, etc. grow but not middle-income, family-supporting manufacturing jobs.

However, Obama blathers on trying to take more credit: “And after a decade of decline, thanks to some of the steps we took…we’ve added nearly 900,000 new manufacturing jobs. Manufacturing is actually growing faster than the rest of the economy.”

Stockman: “But that one is not even a whopper; it’s a bald-faced lie. There has not been one ‘new’ manufacturing job created during Obama’s term in office; and, in fact, the 12.3 million manufacturing jobs reported for June was still 10 percent below the level of December 2007, and nearly 30 percent lower than the 17.3 million manufacturing jobs reported in January 2000.”

It’s even worse if you consider the entire high-productivity, high paying “goods production sector—energy, mining, manufacturing and construction,” which, at 19.6 million jobs in June, was 5 million fewer than in January 2000. Unsurprisingly, the median real household income has declined by 7 percent over the last 15 years.

An otherwise positive area of job growth—health, education and social services, or HES—generated 48,000 jobs in June, slightly more than the 42,000 per month average since 2000; however, they pay an average of $35,000 per year. That is well short of what it takes for a family to depend on; it’s not nearly enough for a one-income middle class family after deducting taxes.

What’s worse for the HES sector “is that these jobs are almost entirely ‘fiscally dependent’ on public sector spending” while America is broke and the debt keeps climbing. “The 32.2 million jobs in the HES sector are funded by $1.5 trillion annually of Medicare, Medicaid and other health and social services entitlements.” Add in (annually) $1 trillion of public education funding, $200 billion of student loans and $250 billion in tax subsidies for health insurance and Obamacare tax credits. “The public sector borrows and taxes to create low productivity jobs within the nation’s highly inefficient, wasteful and monopolistic health and education cartels.” Everything else—the higher, middle class income-generators—gets squeezed.

The free market forces, that would ordinarily create a solid recovery, have been stifled and obstructed by “bailouts, expansion of entitlement programs, regulation of the economy, tax increases, and huge government deficits” (Economics professor, Dr. Tracy Miller). Bailouts simultaneously kept capitol stuck in disfavored, inefficient and less-productive businesses and propped up those that deserved to go bankrupt.

With a 25 percent food stamp benefit increase per recipient—and easier qualification—from 2007 to 2010, the number on that program rose (I’m shocked, shocked!) by over 7 million between 2010 and 2012, while unemployment fell. Democrats slipped changes into the stimulus (ARRA) that made it more financially rewarding to collect unemployment benefits. Moreover, Obamacare has measurably increased part time employment at the expense of additional full time jobs. Only by replacing these Obama-crat policies with conservative, free-market Republican solutions will America be restored to abundance and full employment.