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Economy’s Good News is Finally Genuine, Part 2

The New York Analysis of Policy and Government concludes its examination of the U.S. employment recovery.

While the news that total nonfarm payroll has been increasing (it rose 228,000 in November) the fact that those increases occurred at least partially in manufacturing, a foundation of middle class jobs, is very encouraging. Since the recent low in November 2016, manufacturing employment has increased by 189,000. In November of last year, Manufacturing employment was reduced by 9,000, while government employment rose by 19,000. The latest report notes that unemployment rate fell to an all-time low of 2.6%, an extraordinary reversal.

The Gateway Pundit notes that “Job numbers released today through the end of November show an increase of 2.2 million jobs since last years election and an unemployment rate of 4.1 percent. After the same period under Obama, (4.8) million jobs were lost and unemployment skyrocketed to 9.9 percent! President Trump’s economic results could arguably be the best all time. The stock market is the highest ever and jobs are being created by the thousands.”

John Crudele, writing for the New York Post, notes that despite a left-oriented media’s harsh criticism, “Trump boost to the economy can’t be denied.”

During the Obama Administration, GDP never exceeded 3% annually, the first time at least in the past seventy years this occurred. According to the Bureau of Economic Analysis “Real gross domestic product  increased at an annual rate of 3.3 percent in the third quarter of    2017, according to the “second” estimate released by the Bureau of Economic Analysis. In the second quarter, real GDP increased 3.1 percent.”

Some generic manufacturers also produce quality anti-impotency drug http://icks.org/n/data/ijks/2018FW-1.pdf levitra 20 mg under different names. The reason being levitra india more and more people are living longer & lingering in good health. Keep Your Hopes Up However, viagra uk cheap not all pharmacy websites are connected to scams or cyber criminals. Milk is a reservoir of nutrients and forms an important medicinal product which has achieved immense recognition in the backdrop of the side effects that viagra online are given away by this medicine. Writing for The Hill,  Peter Ferrara noted: “Historically, the worse the recession is, the stronger the recovery typically is. The economy grows faster than normal for a while to catch up to its long-term economic growth trendline, a pattern first noticed by Milton Friedman, the Nobel laureate economist. Based on that metric, the economy should have come out of the recession booming. But to this day, over eight years later, that still has not happened. Real economic growth during the Obama years was stunted below 2 percent. Today, the American economy is still more than $2 trillion below its long term economic growth trendline. The U.S. economy sustained a real rate of economic growth of 3.3 percent from 1945 to 1973 and 3.3 percent sustained real growth from 1982 to 2007… What we are seeing now under Trump are the stirrings of a real recovery from the 2007-2009 financial crisis, which never happened under Obama.”

Despite that, notes The Heritage Foundation “Still Donald Trump gets no respect. Even though nearly every poll for the past six years tell us that Americans care most about jobs and the economy (with terrorism occasionally taking over first place), the media naturally won’t cover the undeniable economic speed up since the election of Donald J. Trump… If the economy and jobs had done this well under President Obama he and the media would have been doing cartwheels down Pennsylvania Avenue. Even worse, when the media does cover the jobs and growth story, every reporter asks me: does Mr. Trump deserve credit for these numbers? Well if he doesn’t, who does? Liberals argue that this is a continuation of the Obama recovery, but there’s a big problem with that analysis: the economy was decelerating under Mr. Obama, not speeding up. In Mr. Obama’s last year in office, 2016, the economy was barely limping to keep ahead of another recession.”

The prospects for significant further growth are substantial if tax reform gets enacted.

The American Enterprise Institute emphasizes that “During the tax-cut-fueled economic expansion in the 1960s, real GDP growth averaged nearly 5%, with economic growth topping 10% in two quarters (1965: Q1 and 1966: Q1) and 8% in eight quarters. US payrolls increased by 32% during the 1960s, the highest growth in jobs of any decade during the postwar period. Government tax revenues grew by 65% from 1965 to 1970.”

Jed Graham, writing for Investors Business Daily  predicts that “The U.S. economy is about to get an injection of rocket fuel.”

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Economy’s Good News is Finally Genuine

The New York Analysis of Policy and Government examines  the U.S. employment recovery, in this two-part review.

The good news about the U.S. economy is, finally, genuine.

During the eight years of the Obama Administration, a supportive media attempted to portray the economy, particularly the job market, as recovering. It was a difficult task.

Obama supporters in the media and elsewhere headlined falling unemployment statistics, but the statistics were deeply misleading. They were attributable to a labor force participation rate which dropped to a decades-low figure (it has yet to recover) and the large number of those who could only find part time employment, to replace the full time jobs they had lost.  The number of discouraged workers, who had exhausted unemployment benefits, rose.

An analysis by Bloomberg outlined the dilemma: the minimal amount of jobs that were being created were in traditionally lower-paying fields, furthering a transfer of employment from middle income to lower income. Payrolls at factories, in particular, were hard-hit. The replacement of middle class jobs with lower paying ones was a key challenge.  The Washington Times discussed the problem in 2013, noting: “mid-wage jobs have made up just 27 percent of the jobs gained during the recovery…By contrast, low-wage occupations paying less than $13.83 per hour have utterly dominated the recovery, with 58 percent of the job gains since 2010.” A significant part of the blame could be directly attributed to factors such as:

  •  Obamacare, which created a financial incentive to eliminate full time positions;
  • Environmental regulations, which impacted manufacturing and mining;
  • Excess federal regulations and high taxes, which drove employers out of the nation.
  • General uncertainty about the direction of a national economy led by a White House that clearly disdained traditional capitalist practices.

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A 2015 Analysis by Investors.com   described the problem: “After six-plus years of President Obama’s big-spending, tax-raising policies, middle-class families have seen their incomes decline and more families have fallen into poverty, Census data show… Median family income dropped slightly to $53,657, down from the year before. Every income group suffered losses, with the lowest fifth of households dropping close to 1%. The overall poverty number barely budged. But it climbed by almost 600,000 among blacks in 2014, more than half of whom were under age 18. From 2009 to 2014, real median household income dropped by more than $1,000 — or 2.3% — to $53,657. (And that decline would likely have been steeper if not for a 2013 change in the way the Census does its annual survey.)

The replacement of middle class jobs with lower paying ones had been noted during Obama’s tenure.  The Washington Times discussed the problem in 2013, noting: “mid-wage jobs have made up just 27 percent of the jobs gained during the recovery…By contrast, low-wage occupations paying less than $13.83 per hour have utterly dominated the recovery, with 58 percent of the job gains since 2010.

During the prior presidency, a CNS  report emphasized that “for ordinary people, what probably matters most is household income. And if you look at the median household income numbers for the United States, Obamanomics is a failure. According to the Census Bureau’s latest numbers, the average family today has less income (after adjusting for inflation) than when Obama took office.

The American Enterprise Institute studied the problem in its report, “The Obama Economy and the Shrinking Middle Class.”  It noted how the poverty rate has increased: “the number of Americans living in poverty has increased by nearly 7 million during the Obama presidency, and the poverty rate went from 13.2 in 2009 percent to 14.8 percent last year. Further, the number of blacks living in poverty increased by nearly 1.4 million during Obama’s time in office, and the black poverty rate was higher in 2011 at 27.6% than any time since the mid-1990s before falling slightly to 26.2% in 2014. More data: the number of Americans on disability reached a record high during Obama’s second term, with an increase of 1.5 million disabled since Obama took office. There’s also be an increase in income inequality during Obama’s time in office, so there doesn’t seem to be a lot of empirical evidence to suggest that America’s middle and working class have seen an improvement in their economic well-being during Obama’s leadership.”

Currently, The Bureau of Labor Statistics report reveals substantive progress in several areas, and substantial progress in others. It notes that the number of those forced to work only part time has fallen by 858,000 over the past year. It also found that there was a drop of 451,000 in those only marginally attached to the labor force. The number of “discouraged workers” has fallen by 122,000.

The Report Concludes Tomorrow

 

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What Politician’s Refuse to Discuss about the Economy

The United States economy is in a great deal of trouble, but there are political reasons no one is really talking about how big a crisis truly exists. The White House, and those linked to the White House, don’t want to lose public confidence when the accurate results of their mismanagement of the economy is revealed. Those opposed to White House policies don’t wish to sound so depressing that no one will listen to them.

The U.S. debt  is rapidly approaching the $20 trillion-dollar mark. Half of all that debt was accumulated during the Obama Administration.  Gross domestic product was at $18.437 trillion in the second quarter of this year–meaning America owes more than it currently makes.  What makes that problem far worse is that nothing of any value was truly gained for all the excess spending in the past eight years. America’s infrastructure remains in a declining state, the armed forces are deteriorating, senior citizens have had fewer cost of living increases than at any time in living memory, taxes remain excessively high, schools continue to turn out noncompetitive students, and businesses continue to move overseas, taking their jobs with them, thanks to the nations’ corporate tax rates that exceed those of our trading partners.

Under current policies, no upswing is in sight. In fact, some key observers such as Deutsche Bank believe that “The U.S. has a 60% of entering a recession in the next 12 months—the highest probability since the Great Recession.”

The Congressional Budget Office (CBO) predicted that in fiscal year 2016, the federal budget deficit will increase in relation to economic output for the first time since 2009. “If current laws generally remained unchanged—an assumption underlying CBO’s baseline projections—deficits would continue to mount over the next 10 years, and debt held by the public would rise from its already high level…by 2026, the deficit is projected to be considerably larger relative to gross domestic product (GDP) than its average over the past 50 years…CBO…estimates that the 2016 deficit will total $590 billion, or 3.2 percent of GDP, exceeding last year’s deficit by $152 billion (see table below). About $41 billion of that increase results from a shift in the timing of some payments that the government would ordinarily have made in fiscal year 2017; those payments will instead be made in fiscal year 2016 because October 1, 2016 (the first day of fiscal year 2017), falls on a weekend. If not for that shift, the projected deficit in 2016 would be $549 billion, or 3.0 percent of GDP—still considerably higher than the deficit recorded for 2015, which was 2.5 percent of GDP.”

The Congressional Budget Office also predicted that in fiscal year 2016, the federal budget deficit will increase in relation to economic output for the first time since 2009. “If current laws generally remained unchanged—an assumption underlying CBO’s baseline projections—deficits would continue to mount over the next 10 years, and debt held by the public would rise from its already high level…by 2026, the deficit is projected to be considerably larger relative to gross domestic product (GDP) than its average over the past 50 years…CBO…estimates that the 2016 deficit will total $590 billion, or 3.2 percent of GDP, exceeding last year’s deficit by $152 billion (see table below). About $41 billion of that increase results from a shift in the timing of some payments that the government would ordinarily have made in fiscal year 2017; those payments will instead be made in fiscal year 2016 because October 1, 2016 (the first day of fiscal year 2017), falls on a weekend. If not for that shift, the projected deficit in 2016 would be $549 billion, or 3.0 percent of GDP—still considerably higher than the deficit recorded for 2015, which was 2.5 percent of GDP.”
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Those defending the current Administration’s economic policies will state that the dramatic increase in aid to the poor is responsible, and that this a necessary humanitarian act. (The SNAP program, often referred to as food stamps, is up by about 40%.) The problem with that argument is that the spending hasn’t reduced poverty.  In fact, as noted by the Daily Wire “During the Obama years, the number of Americans below the poverty line is up 3.5 percent.” Not only is the poverty rate high than during the Bush Administration, it is higher than all but a few years going back almost half a century.

Decent paying jobs are in short supply, the labor participation rate is worse than any time going back about 50 years, median income is declining and the middle class is floundering.

Despite the dismal status, there is a roadmap for recovery, one followed by former presidents John F. Kennedy and Ronald Reagan. Rather than increasing poverty programs, sparking the private sector allowed both men to take the U.S. economy from the doldrums to growth. Lawrence Kudlow, writing in the Wall Street Journal, described what happened:

“Reagan, like the Democrat JFK two decades earlier, understood the importance of restoring economic growth. In 1980, Reagan adopted Rep. Jack Kemp’s “duplication” (as Kemp called it) of the Kennedy tax cut. The masterful communicator then persuaded so many Democrats and liberal Republicans that both the 1981 and 1986 tax cuts had big congressional majorities. The 1986 act passed the Senate 97-3 and took the top income-tax rate down to 28%, one of the lowest levels ever. Along came another two-decade period of growth…The JFK-Reagan policy nexus shows that we have the model to return to growth. It works. There is no reason the model cannot be used again now.”