Saturday, July 7, 2012

Quick Hits - July 7, 2012

On a summer Saturday, with much of the United States sweltering under a long heat wave, one of the main topics of conversation remains the June jobs report which was released yesterday.

As I covered yesterday, this was another disappointing jobs report - with a net of 80,000 jobs created during the month.  President Obama called the latest jobs numbers 'a step in the right direction'.


Or should it be, wtf?

The right direction?

More people were added to the federal government disability rolls than new jobs were created in June.  Job growth in the 2nd Quarter of 2012 is one third the job growth of the 1st Quarter of 2012.  Not one month in the 2nd Quarter grew enough jobs to cover even the population growth of the country.  Labor participation rates are at their lowest levels in 30 years - down substantially from when the President took office in January 2009.  5 million fewer people are working today than there were in January 2009.

James Pethokoukis, of the American Enterprise Institute, has calculated that with the current level of labor participation, the economy needs to average 219,000 new job created each month between now and November to get the [cooked] unemployment level below 8% by election day.  Under Barack Obama, we've spent more time with an unemployment rate above 8%, 41 consecutive months, than the total time the rate was above 8% between 1945 and 2008 - 39 total months.  This is also the President who promised in the spring of 2009 that if he got the $850 billion stimulus, we would be seeing at this point a 5.5% unemployment rate and a >4% GDP growth rate.  (Current GDP growth is at 1.9% and showing strong sides of sliding lower.)

Larry Kudlow's National Review column highlights a report on Obamanomics by the Joint Economic Committee (JEC).....
The Joint Economic Committee (JEC), spearheaded by Texas congressman Kevin Brady, put out a report saying that the Obama recovery now ranks dead last in modern times. That’s a real milestone in the post-WWII era. It’s ten out of ten for both jobs and economic growth. According to the Bureau of Economic Analysis, real GDP has expanded only 6.7 percent over the eleven-quarter recovery since the recession ended. The Reagan recovery at the same stage had increased by 17.6 percent. The Clinton recovery by 8.7 percent.

As for jobs, the Bureau of Labor Statistics reports that the number of private-sector jobs has grown by only 4.1 percent since the cyclical low point. Reagan’s record was 10.7 percent.

So much for Obamanomics. Didn’t work. Still isn’t working. As the JEC put it, spending stimulus, housing bailouts, auto bailouts, financial bailouts, cash for clunkers, cash for caulkers, and $5 trillion in deficit spending left the Obama recovery dead last in modern times.

This is the right direction?

The Republican National Committee has this response to the President...

While the SuperPAC Crossroads GPS is starting to run this advertisement in the campaign battleground states asking if all President Obama has are excuses...

The Investors Business Daily has a couple of editorials that also highlights the fundamental challenges with the President's economic policies - and agenda.

One of these focuses on the weak June jobs report, listing 10 reasons why the job market is even weaker than the June jobs report.

Reason #8 recalls the President's gaffe from last month when he said that the private sector is 'doing fine'. It notes that private sector employment is still down 3.9%, or 4.5 million jobs since the President took office. Overall government jobs, including local, state, and federal, are down 1.9%, but that the federal government jobs, excluding the U.S. Post Office, are UP 10.7%.

The press release from the President's economic advisory team did acknowledge the below expectation job creation number, while going back to not only tell us 'not to read too much into' the monthly jobs report, but repeating the misleading statement that the Administration has 'created 4 million jobs' since the fall of 2009.

The real interesting aspect of the suggestion to 'not to read to much into' monthly jobs reports is that the White House has reminded us of this 30 times previously referencing 30 other monthly jobs reports.

The other interesting IBD editorial focuses on the complete fallacy of the Keynesian economic policies that are advocated by President Obama, Paul Krugman, and other leading progressives. Despite the argument made by John Maynard Keynes, more government spending does not deliver more jobs.
Political leaders continue to peddle the snake oil that we can spend our way back to prosperity.

The Obama administration has pushed government's share of GDP past 40%, the highest ever without a major war. Europeans are grousing about austerity, seeing crippling debt not as a comeuppance but as an obstacle to the spending needed to revive a moribund economy.

In the 1930s, with the world in the Great Depression's death grip, British economist John Maynard Keynes argued that massive government spending would boost demand and put the unemployed back to work. Over the next eight decades, Keynesian stimulus became the standard remedy for weak economies — even though it has never worked.

President Barack Obama is wrapping up his campaign bus tour through the battleground states of Pennsylvania and Ohio.  Here's a picture of the town of Beaver, Ohio welcoming the President to the town...

One of the terms I use to denote President Barack Obama is to call him our 'Narcissist in Chief'.  As I've discussed and highlighted numerous times, the President has all of the traits of being a true narcissist.  Weasel Zippers has a post that highlights just why Barack Obama has earned this title - with his use of the first-person pronoun 'I' and 'Me' 117 times in a single campaign speech...
Speaking in Sandusky, Ohio on July 5, President Barack Obama used the first-person pronouns “I” and “me” a combined 117 times in a speech that lasted about 25 minutes and 32 seconds.

Obama used “I” 98 times and “me” 19 times, according to a transcript of the speech posted by the White House. A videotape of the speech posted on YouTube shows that Obama spoke for about 25-and-a-half minutes.

During this speech, Obama used “I” or “me” approximately once every 13.09 seconds.
Earlier this week, I highlighted a rather arrogant and clueless comment made by the current head of the Environmental Protection Agency, Lisa Jackson, who asserted that the regulatory decisions and actions by the EPA has not cost the country one job or damaged the economy.

Columnist George Will, writing in the Washington Post, addresses how vapid Jackson's claim is in a column that reflects how the EPA's heavy hand is threatening the national economy...
If the EPA mandates the most expensive technologies, each of the NGS owners would have to weigh whether it is sensible to make large capital investments in a plant that might not operate after that. Furthermore, one of the six owners of the NGS is the Los Angeles Department of Water and Power, which may be prohibited by California law — the state may be destitute, but it is determined to fix the climate — from making investments that will extend the life of coal-fired plants.

Testifying to Congress last February, an EPA official uttered the six-word incantation that summarizes Obama administration policies and progressivism generally: “We do not have to choose.” It is, the official said, quoting President Obama, a “false debate” that we have to choose between the “public health benefits from reducing air pollution from power plants” and “growing this economy in a robust way.”

But benefits usually have costs. And in reality — which is the region contiguous to Washington — two pertinent questions usually are: How much government do you want, and how much are you willing to pay for it in diminished economic growth? The Obama administration consistently favors more government and, believing that “we do not have to choose,” is mystified by stubbornly sluggish growth.

This isn't just the case on a national level either. The Progressive Republic of California is starting to see the true effects of it's own climate change law, AB32, on the statewide economy...
The first study—sponsored by the California Manufacturers and Technology Association, whose members employ 1.2 million residents—estimates the price tag for three major new regulations associated with the law: cap-and-trade taxes on carbon emissions, a "low carbon fuel standard," and a stringent 33% renewable mandate for electricity production. Together these policies raise energy costs and are expected to reduce state GDP by between 3.5% and 8.9% by 2020.

Even under the "optimistic" scenario, that's a loss of up to $447 billion in California output over eight years and represents a bigger loss in income than the 2008-09 recession. The cost per California family is estimated at $2,500 a year due to higher costs. Repeat after Milton Friedman: There is no such thing as a free lunch.

One alarming conclusion is that "emissions reductions due to economic harm account for 26% of total reductions, more than any ARB mandated program" except cap and trade. This means that a major way Californians will reduce their greenhouse emissions is by slower growth, chasing industry out of the state, and putting more people out of work. If Californians produce less, their carbon footprint is smaller.

California is a state that is completely and utterly dominated by progressive Democrats. Every major elected state-wide position is currently occupied by a progressive Democrat. Both the State Senate and State Assembly are dominated by progressive Democrats - with only a few votes in the State Assembly keeping the Democrats from having the two-thirds majority to increase taxes.

In this environment, it's no real surprise that the State Senate yesterday followed the State Assembly to vote to approve the spending of $7.9 billion dollars to begin the first phase of construction for the state's boondoggle high speed rail network to connect San Francisco to Los Angeles..

The State Senate, like the State Assembly, cast its ballot strictly along party lines (21-16), to embrace a project that is estimated to need between $68 billion and $98 billion to complete.  Lost within the decision is the fact that California is now wallowing in a $16 billion budget deficit - and voters in the state are being brow beaten by Governor Jerry Brown to pass a $7 billion tax increase package that is supposed to solve the $16 billion deficit.  (Yes, that's the logic of the state's progressive leadership - $7B in new taxes will erase a $16 billion deficit.)

Who cheered the loudest on word of the passage of the high speed rail measure besides Governor Moonbeam (or is now Moonbat?)?  Union representatives present for the vote to twist a few arms loudly cheered the passage of the bill.  Why?  They are the ones who will benefit the most from the state's leap into the morass of an unviable business model - specifically the union leadership and the union coffers.

Barack Obama's U.S Transportation Secretary Ray LaHood released a statement applauding the vote by California's legislature...
“No economy can grow faster than its transportation network allows,” U.S. Transportation Secretary Ray LaHood said in a statement applauding the legislative vote. “With highways between California cities congested and airspace at a premium, Californians desperately need an alternative.”

This is the same Transportation Secretary, who on June 30th, echoed so many others of the Obama Administration's admiration for the governmental system of the People's Republic of China, noting that while in the US 3,000 or 3,000,000 are involved in making decisions, China has only three people making decisions....
Echoing the laments of pundits like Thomas Friedman of the New York Times, U.S. Transportation Secretary Ray LaHood argued Saturday that China outpaces the United States in building major transportation infrastructure like high-speed rail because of its authoritarian system and because the Chinese don’t have the Republican Party holding up progress.

“The Chinese are more successful [in building infrastructure] because in their country, only three people make the decision. In our country, 3,000 people do, 3 million,” LaHood said in a short interview with The Cable on the sidelines of the 2012 Aspen Ideas Festival on June 30. “In a country where only three people make the decision, they can decide where to put their rail line, get the money, and do it. We don’t do it that way in America.”

Raving about a totalitarian and brutal regime because he likes their efficiency. Is this today's version of supporting fascism because it made the trains run on time?

Mark Steyn will bring today's QH to a close as he writes in this week's column about America's Twilight and asks if the lamp of liberty is going out?
But no advanced society has ever attempted Big Government for a third of a billion people — for the simple reason that it cannot be done without creating a nation with the black-hole finances of Stockton, Calif., and the Black-Hole-of-Calcutta fetid, airless, sweatbox utility services of Rockville, Md. Thanks to Obamacare, in matters of health provision, whether you’re in favor of socialized medicine or truly private health care, Swedes and Italians are now freer than Americans: They have a state system and a private system, and both are relatively simple. What’s simple in micro-regulated America? In health care, we now have what’s nominally a private system encrusted with so many statist barnacles that it no longer functions as either a private or a state system. Thus, Obamacare embodies the strange no-man’s-land of statism American-style: The U.S. is no longer a land of republican virtue and self-reliant citizens but it’s not headed for the sunlit uplands of Scandinavia, either.

In their book The Size of Nations, Alberto Alesina and Enrico Spolaore argue that, if America were as centrally governed as France, it would have broken up long ago. But hey, that’s no reason not to try it! In a land where everything else is supersized, why not government?

Today in History

1865 - Mary Surratt becomes the first woman executed by the U.S. federal government. Surratt was convicted as a conspirator in the assassination of President Abraham Lincoln and sentenced to death, along with three other co-conspirators.

1898 - The United States annexes Hawaii.

2005 - 4 al-Qaeda suicide bombers strike 3 subway trains and one bus during the peak of London's morning rush hour, killing 56 people and injuring another 700 people. Two weeks later, on July 21, 2005, a second set of four bombings was attempted, also targeting the city's transit system, but failed when the explosives only partially detonated. The four men alleged to be responsible for the failed attacks were arrested in late July.

2011 - The world's first artificial organ transplant takes place. It was an artificial windpipe coated with stem cells from the patient and grown in a lab.

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