April 24, 2014

Financially, we’re not better off, says the US Census. Especially young workers.

According to data in the US Census released today, most Americans are not better off financially after Barack Obama’s first term as President of the United States. Whether this will translate at the polls in November remains to be seen.

The median household income for families dropped 1.7 percent from 2010 to 2011 to $62,273. That’s 8.1 percent lower than in 2007, the year before a collapse in the housing market led to what has been the longest recession in a generation. According to the report, income rates among all race groups have not recovered from highs experienced previous to the 2001 recession caused by the collapse of the dot-com bubble.

Hardest hit by the slow growth are families led by women, with 31.2 percent of families with a female householder living under the poverty line while only 16.1 of families with a male householder living in poverty. Nationwide 46.2 million people, or 1 in 6 Americans, remain in poverty, the highest in the half century that records have been kept and at 15 percent at about the same rate as it was in 1993.

The effect of the recession has been felt in Utah, as well, despite weathering the recession better than most states.

“We compare favorably to other states,” said Utah state demographer Juliette Tennert in an article in the Salt Lake Tribune. “But compared to our history, our poverty rate is up.” Tennert noted that while Utah had lost 80,000 jobs since the beginning of the recession, 60,000 of those have returned.

However, warns Pam Perlich a senior research economist at the University of Utah, those jobs have not all been at the same wages as those lost.

“There have been tremendous job losses, and many of the new jobs that are being created are not at as high of a wage level as the jobs that were lost,” Perlich told the Salt Lake Tribune. “It’s more than a recession, it’s an economic restructuring.”

In a blog post, the White House noted there is more work to be done.

“While we have made progress digging our way out of the worst economic crisis since the Great Depression, too many families are still struggling and Congress must act on the policies President Obama has put forward to strengthen the middle class and those trying to get into it,” the White House post said.

How America’s continuing economic struggle will play out politically remains to be seen. After a slight bump in the polls after the Democratic National Convention, Obama and Republican challenger Mitt Romney are polling neck and neck.

With 53 percent of 18-24 year olds living back at home with their parents, it should come as no surprise that support among the young for Obama has fallen. Young voters between ages 18 and 29 have been among the groups hit hardest by the recession, with 12.7 percent unemployed and nearly a third underemployed. Support for Obama in this group has fallen from 49 percent to just 41%, a blow to a group that was important to the President’s 2008 win.

Welcome to Obamaland

“Once you vote black, you never go back: Obama 2012″ says the pin being worn on the Democratic Convention floor.

Welcome to Obama Land, where Bill Clinton is more popular than the Commander in Chief and it’s ok to sell racist buttons.

I came home last night from visiting with some neighbors to find Bill Clinton on my television. He was in prime form, and the crowd was eating from his hand. Unfortunately, my four-year old was still awake, so I made my way to her room to tell a story or two. We both dozed off, and twenty minutes passed before I could sneak out…but never fear: Clinton was still speaking.

I’ll spare you the details, except to say this: more than one Democrat found themselves wishing that Clinton was on the ticket this election. In fact, I wonder if Clinton himself isn’t wishing he was on the ticket, too(thank heavens for the Twenty Second Amendment). Not only did Clinton stand before Democrats as a master speaker, a circus ring leader, an orator of epic proportions, he is the most successful Democrat  in a generation. In spite of winning the White House without wining a majority of the country (thank you, Ross Perot), he learned to work with a Republican controlled Congress to keep the country moving, saw a budget surplus, and even reformed welfare to require more of welfare recipients.

Obama, even with control of both Houses of Congress, couldn’t even pass a budget, let alone move the country from recession to growth, to say nothing of the boom that Clinton saw during his years (and the bust that he left just in time to avoid). There is that Affordable Care Act thing that he’s got to his name, but all that has boiled down to for him is loathing from the right and begrudging gratitude from the left, because who really wants a tax increase?

Which is what it is.

And so, with the cheers for 42  ringing through the auditorium, the pièce de résistance will be when President Obama takes the stage (right after the Gaff in Chief) to tell America why, with 8.3% unemployment, $16 trillion in debt, and nearly 23 million Americans unemployed or underemployed, he should be awarded a second term.

See, it’s all about the economy, and we aren’t stupid.

With that in mind, here are a few quick hits that you should be aware of going into tonight’s DNC speeches:

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President Obama isn’t just competitive. He vastly overestimates his ability…says the New York Times:

But even those loyal to Mr. Obama say that his quest for excellence can bleed into cockiness and that he tends to overestimate his capabilities. The cloistered nature of the White House amplifies those tendencies, said Matthew Dowd, a former adviser to President George W. Bush, adding that the same thing happened to his former boss. “There’s a reinforcing quality,” he said, a tendency for presidents to think, I’m the best at this.

His scope of competition includes important things, like golf and bowling:

Image representing New York Times as depicted ...

Image via CrunchBase

For someone dealing with the world’s weightiest matters, Mr. Obama spends surprising energy perfecting even less consequential pursuits. He has played golf 104 times since becoming president, according to Mark Knoller of CBS News, who monitors his outings, and he asks superior players for tips that have helped lower his scores. He decompresses with card games on Air Force One, but players who do not concentrate risk a reprimand (“You’re not playing, you’re just gambling,” he once told Arun Chaudhary, his former videographer).

His idea of birthday relaxation is competing in an Olympic-style athletic tournament with friends, keeping close score. The 2009 version ended with a bowling event. Guess who won, despite his history of embarrassingly low scores? The president, it turned out, had been practicing in the White House alley.

That’s why, says Forbes, Eastwood may have been right: “Obama is a lousy CEO.”

 _____

Barack Obama

Barack Obama (Photo credit: jamesomalley)

In 2008, candidate Obama won with a coalition of groups, including the young. Today, with more college graduates than ever living at home (and perhaps staring at “faded Obama posters“) with parents, Obama’s popularity among young voters has dropped. Unemployment for ages 18 to 29 is at 12.7%, higher than the national average and a level that has depressed 1.7 million of them to stop looking for jobs.  Says Karl Rove:

Then there are voters ages 18 to 29, among Mr. Obama’s most important supporters in 2008. The roughly 23.7 million “millennials” who voted in 2008 were 18% of the electorate, up 2.9 million voters over the previous presidential race. They gave Mr. Obama 66% to Sen. John McCain‘s 32%, according to exit polls. This margin of roughly eight million votes was a major chunk of Mr. Obama’s overall edge of 9.6 million.

But youthful enthusiasm for Mr. Obama has waned. In October 2008, 78% of voters 18-29 told Gallup they would definitely vote that year. Now it’s 58%.

There’s also evidence that fewer younger people are registered. A November 2011 study from Tufts University found that 43% of the decline in Nevada’s voter rolls since 2008 came from voters ages 18-24. Similarly, while North Carolina’s rolls rose by 93,709 over that period, more than 48,000 younger voters were dropped from the rolls, 80% of them Democrats.

Mr. Obama’s lead over Mr. Romney in the latest JZ Analytics poll among voters ages 18-29 is 49% to 41%. If young voters turn out this fall in the same numbers as in 2008 and give Mr. Obama this eight-point margin, it will take 2.8 million votes from Mr. Obama’s total and add more than 3.3 million to Mr. Romney’s tally.

Ouch. With 53% of all 18-24 year-olds back home with mom and dad, robust growth will be needed to get them back, but the 2.2.% of growth we’ve seen since 2009 just isn’t cutting it.

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 What do you do when your narrative doesn’t fit the facts? Explain them? Take responsibility for them? Change plans to compensate?

Silly me. Obviously, you ignore all that and just plow forward with the narrative. Duh.  Leave fact checking to the fact checkers.

Among other problems in the Democratic narrative over the last couple nights is the jobs situation. We’ve been hearing a lot about 4.5 million new jobs. If that were true, the question would be, what was all that from the Republicans last week about “are you better off?” Clearly, with 4.5 million new jobs, we are.

However, if it’s not clear to you, let FactCheck.org clarify: there has not been 4.5 million new jobs.

  • The keynote speaker, San Antonio Mayor Julian Castro, also said there have been 4.5 million “new jobs” under Obama. The fact is the economy has regained only 4 million of the 4.3 million jobs lost since Obama took office.

And that’s just one of many.

What else can we expect tonight? And how will the spin doctors tell it tomorrow.

[New York Times][Forbes][WSJ][FactCheck.org]

Obama’s Latest Jobs Speech: “Stop the political circus,” says the Ring Master.

President Obama and I agree on at least one thing: “Washington hasn’t always put [Americans'] interests first.”

Ain’t that the truth.

With Republicans vying for his job, the economy persistently sluggish, and unemployment relatively unchanged since the Bush Administration, President Obama took to the podium to make “the big speech” before a special Joint Session of Congress to lay out his job plan.

This is not his first job plan. In fact, you’d be hard pressed to find a month where the news has not talked about an Obama job plan.

  • In November of 2008 (“After more than two weeks of virtual silence on the economy, President-elect Barack Obama’s transition team burst on the scene with new ambition and urgency Sunday, demanding swift passage by Congress of a massive two-year spending and tax-cutting recovery program.”)
  • In January of 2009 (“President-elect Obama countered critics with an analysis Saturday by his economic team showing a program of tax cuts and spending like he’s proposed would create as many as 4.1 million jobs, far more than the 3 million he has insisted are needed to lift the country from recession.“)
  • In March of 2009, after its passage (“President Obama on Friday touted the benefits of his economic recovery plan [...] the recently passed $787 billion stimulus package.”)
  • In July of 2009, after the plan failed to stop unemployment from climbing to 9.5% (“Obama, a Democrat, is trying to restore economic growth to the US but his $787-billion economic stimulus plan [...] failed to stop the unemployment rate from rising to 9.5 percent.”)
  • In December of 2009 (“President Barack Obama says his administration needs to “get America back to work” as quickly as it can, and he‘s putting together a list of proposals aimed at doing just that.”)
  • In February of 2010 (“President Obama hit the road again Tuesday to promote the new job-creation program he described as his No. 1 priority, [...]“)
  • September of 2010, just one year ago (“U.S. President Barack Obama will announce on Monday a six-year infrastructure revamp plan with an initial investment of $50 billion to jump-start job creation, a White House official said.”)
  • In February of 2011 (“The Obama administration outlined an “innovation strategy” for US job growth Friday, [...]“)
  • In May of 2011 (“Obama, GOP unveil competing plans for job growth.”)

That’s a lot of talk, but not a lot of change. But don’t lose hope. The President has another plan for you. 

I’ll give him this: Obama’s got a lotta plans. But he isn’t making much headway. Unless, of course, you have managed to convince yourself that he actually staved off a worse disaster.  Maybe, but even President Obama sells his plans not as fingers in the dike, but as reversals.

Anyway, in America we don’t believe in treading water–we believe in winning. Why else would we keep score? 14 million people can’t be wrong–the plans just aren’t working.

So what is he proposing, this time?

Where we agree

First, there are a couple things he said that I liked…assuming he means them:

Economic Growth is  Driven by Business

Those of us here tonight can’t solve all of our nation’s woes. Ultimately, our recovery will be driven not by Washington, but by our businesses and our workers.

Great! But why have all of your plans up to now been focused more on funding the public sector, increasing the debt that must be paid by taxes from individuals and the private sector, and not just decreasing the cost of doing business for “businesses and workers,” as per your speech? Why wait until the 11th hour to come to Jesus?

Infrastructure Helps Business and Employs Construction Workers

Everyone here knows that we have badly decaying roads and bridges all over this country. Our highways are clogged with traffic. Our skies are the most congested in the world.

This is inexcusable. Building a world-class transportation system is part of what made us an economic superpower. And now we’re going to sit back and watch China build newer airports and faster railroads? At a time when millions of unemployed construction workers could build them right here in America?

I like upgrading our roads. But what’s new about this from promised infrastructure fixes over the last three years? What happened to the spending you’ve been talking about since 2009?

OK, so, maybe I agree, but I’m a little distrustful of his sincerity. And that the money is actually going to get the economy going again. Employing workers to build roads and bridges will get cash into the economy, but it alone won’t employ 14 million people, most of who are not construction workers.

Where  He’s Wrong

On the other hand, there are several places that I just flat out think the President is wrong.

Federal Money to Rebuild Schools

And there are schools throughout this country that desperately need renovating. How can we expect our kids to do their best in places that are literally falling apart? This is America. Every child deserves a great school — and we can give it to them, if we act now.

The American Jobs Act will repair and modernize at least 35,000 schools. It will put people to work right now fixing roofs and windows; installing science labs and high-speed Internet in classrooms all across this country.

I’m all about education (even if, as a high school drop-out, I’m not a huge fan of public ed), but I don’t agree that this has anything to do with getting the economy going or creating jobs. Yes, every kid should go to a good school, but no, that has nothing to do with the economy, or with the federal government. That’s the states’ job, and the only thing it does is redistribute money from state A to state B.

So, Mr. President, rather than increase our taxes (or the deficit, but it’s the same thing, in the long term), just let us keep our money in our states, and we’ll fix the schools ourselves.

Federal Money to Hire Teachers

Again, with the education thing.

Pass this jobs bill, and thousands of teachers in every state will go back to work. These are the men and women charged with preparing our children for a world where the competition has never been tougher. But while they’re adding teachers in places like South Korea, we’re laying them off in droves. It’s unfair to our kids. It undermines their future and ours. And it has to stop. Pass this jobs bill, and put our teachers back in the classroom where they belong.

My problem with this is the horribly faulty logic and the blatant pandering to the education unions.  As economist Arnold Kling explains “it assumes that state and local governments need more money in order to keep teachers. They do not. They could reduce compensation and maintain hiring or even increase it.”

In other words, states aren’t firing teachers. Teachers are leaving for better paying jobs, or the states are paying teachers too much (and that’s an entirely different conversation than this one, which is, if you forgot–THE ECONOMY).

A reduction in the number of teachers only indicates that you need more money if the reduction comes from teachers quitting their jobs. If you are laying off teachers, that shows that you are making a choice to keep their compensation too high rather than have more on staff.

Get it? States aren’t firing teachers to make cuts–they are paying them more than they should. They could pay less, and employ more, but (again, enter the unions), that’s not going to happen.

Remember, I’m not saying that what teachers are paid is fair or enough. I’m saying that there’s no correlation, in spite of what President Obama is trying to trick you into believing–that states have fired teachers because of budget crunches.

If you aren’t a teacher, you must be an oil executive

Should we keep tax loopholes for oil companies? Or should we use that money to give small business owners a tax credit when they hire new workers? Because we can’t afford to do both. Should we keep tax breaks for millionaires and billionaires? Or should we put teachers back to work so our kids can graduate ready for college and good jobs? Right now, we can’t afford to do both.

This isn’t political grandstanding. This isn’t class warfare.

Actually, it sounds a lot like class warfare. The 14 million people out there that are unemployed are, for the most part, not former teachers. In fact, education, up until 2010, was the industry that actually increased in employment.

Enter the graphic:

And that was just as of the middle of 2010!

Who are the big losers, then? You wouldn’t know it to listen to the President’s speech, but among the unemployed you can find former professionals and business service providers , construction workers (housing industry, not bridge building, though arguably, they could cross over, I assume), durable goods (like the auto industry) and retail (where shop).

Conclusion: Fail. Just like all the other plans.

I’d like to see the economy rise in the next year, because everyone would win. But what President Obama does get is that he doesn’t get it. Like one candidate said in the Reagan Library Republican Debate Wednesday night, “the President is a nice guy, but he doesn’t have a clue.” And, as another said, “its time to get out from behind the teleprompter.”

Yes, he can speech-ify, but speeches don’t amount to results, as we’ve seen for the last three years. I hope the Congress can find the morsels within the plan that will help, pass them, and move us forward.

On the whole, though, I’m not sanguine. As one Twitter level pundit put it, the speech was not expected to offer anything new. And it didn’t fail to deliver on that point.

[Read the full text here.]

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In which I express mock surprise at how well it pays to work for the President of the United States

Evidently, these salary increases are not connected to performance.

Gawker tells the story:

The White House says that many of those positions are considered nonpolitical jobs that come with their own pay schedules, and that what matters is that the total budget and average salary are decreasing slightly. But that doesn’t change the fact that White House staffers who stick it out are being rewarded, on average, for their continued service at a rate that far outstrips how the average white-collar worker is doing. The rhetoric behind the White House salary freeze was about making sure that the people engaged in leading the nation out of its economic mess share a sense of what American workers are experiencing. Unless roughly half of American workers saw their paychecks go up by an average of 8% last year (hint—they didn’t), that’s not the case.

Shocker.

Government revenues are down, but employee salaries are up. Well, not every employee’s salary–just those who work in the President’s staff. If this were a business (which it is not, and no, I’m not saying government should be run like a business), this would be the equivalent of the CEO giving his executives big raises while company revenues are falling.

In other words:

http://twitter.com/johnboehner/status/88618213008621568

Lest you think that’s a partisan sentiment:

http://twitter.com/AFLCIO/statuses/88606123711664128

 

I’d love to hear what those highly paid special and deputy assistants advise on that one.

PS: I’m not opposed to government workers receiving compensation commensurate with their qualifications, job description, and market demand. However, I do oppose policies that have done little but strap us with greater spending liabilities with little to no effect on our revenues.

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Recoveries Comparison: Reagan and Obama

If what you are doing isn't working, perhaps it's time to try something else?