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A guest article by Dan Wilson.

With the onset of the election, the economy continues to remain the number one issue on voters’ minds.  President Obama would have them believe he turned the economy around from the abyss after the financial crisis of 2008, and were now on a forward path because of his policies.  The problem with this story is that  it doesn’t stand up to scrutiny. Almost every broad-based measurement of economic well-being shows stagnation or decline over his term. Given this, voters should look towards the Republican nominee for president, Mitt Romney, to lead this country towards economic revival.

For starters, look at the jobs market. 23 million Americans continue to remain unemployed, underemployed or stopped looking for work. The only reason the unemployment rate declined from its recessionary peak of 10% to its current level of 8.1% is from millions of Americans dropping out of the labor force. Since the unemployment rate is calculated by dividing the amount of people unemployed by the labor force, all it takes for the unemployment rate to drop is for individuals to become discouraged and stop registering their unemployed status to the government. The labor force participation rate stands at a 60 year low for males. Instead of finding a job millions of Americans have found it more convenient to live off the current administration’s expansion of the social safety net. In fact, the unemployment rate calculated with the same labor force participation rate held on January 2009 would be through the roof at 11.3%.

There has been 4.5 million private sector jobs added over the past 30 months that Obama likes to talk about. But, compared to other recoveries after a severe recession, 4.5 million jobs is disappointing to say the least. If this jobs recovery kept up with the pace of the Reagan recovery, roughly 7.5 million more people would have a job. Based on the past 20 years of job growth our economy is currently 13 million jobs below its trend line.

On top of that, a recent study demonstrated that most of the jobs lost during the recession were middle-class jobs while majority of the new jobs are lower class. In other words, not only have the quantity of jobs added under Obama undershot expectations, but they have also suffered in quality.

Given the dismal state of job and income growth, it’s no surprise that household incomes have actually fallen more during the so-called recovery than the actual recession. Under the latest estimations, household incomes fell 2.6% during the recessionary years and by 4.8% since.

Though the scariest picture of them all is the coming sovereign debt crisis this country faces similar to the situation facing many European countries. The current administration’s appetite for debt fueled government spending in the name of stimulus and wealth redistribution may be the final straw that breaks the back of our economy, equalizing us with the debt ridden, depressed economies of Europe. Since taking office, the Obama administration has run four consecutive trillion dollar deficits, increasing the national debt by 5.6 trillion in less than four years. The national debt as a percentage of GDP, which measures our liabilities against assets, has risen from an already too high rate of 70% when Obama took office, to over a whopping 100%. Under current budget projections, this ratio only worsens under an Obama second term, as the national debt continues to grow faster than the economy.

In short, economic statistics clearly reveal that the US economy has stagnated under the current administration’s policies and faces financial ruin in the near future if we don’t reverse course. Ultimately, voters will decide whether we stay with the status quo of misery or turn the corner and select a new set of policies with a Romney administration, which will foster prosperity that this country is so used to.

Daniel Wilson is a recent graduate of James Madison University and holds a degree in economics.

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Guest Post by Daniel Wilson

With an election rolling around the corner, President Obama is out on the campaign trail touting himself as an economic savior for the homeland. Though, it’s hard to imagine how anybody could possibly run on an economic record as lousy as his own. After all, the majority of Americans still believe the economy is in a recession.

Technically, the recession ended in the second quarter of 2009, but the so-called recovery has been too weak to reverse much of the catastrophic damage done to the average household during the recent economic collapse. For example, since the alleged recovery began real gross domestic product growth has averaged an anemic 2.4 percent, with 1.9 percent for the first quarter of 2012.

Given the depth of the economic contraction from the financial crisis, economists would expect a much larger rebound in growth rates. Historical evidence compiled by many economists, including Milton Friedman, clearly shows that deep economic downturns are followed by rapid expansions. For instance, at this same point in the 1980s recovery following  the deep contraction at the start of the decade, GDP growth averaged a much more robust rate of 6 percent.

What about on the jobs front? The picture remains the same, no real recovery to speak of. True, the private sector has added 4 .3 million jobs over the past 27 months, which is around 160,000 jobs a month. However, that’s hardly enough jobs to keep up with the growth in the labor force and private sector jobs are still 4.5 million below their 2008 peak. Hence, employment statistics continue to remain in the dumps.

For instance, the unemployment rate has been above 8 percent for over 40 consecutive months, the longest since the 1930s. The labor presentation rate has plummeted to multi-decade lows as millions of discouraged workers have stopped looking for work and are no longer part of the official unemployment rate. In fact, if you calculate the unemployment rate using the same labor participation rate held on January 2009, the unemployment rate would be 10.9 percent.

So what’s holding back the economy? John Taylor, a prominent economist from Stanford University, believes the current administration is most to blame through their interventionist economic policies. Taylor argues that the increased regulatory burden of government over the last few years, including but not limited to, Obama care,  Dodd- Frank, an overzealous EPA and NLRB, have stifled business expansion, causing resources to remain idle instead of being used in productive manners that foster job creation. To validate this view, a recent poll done by the Chamber of Commerce found that 74 percent of small businesses say that Obama Care makes it harder for their business to add employees. Another recent poll by Gallup found that the number one problem small businesses face is complying with government regulations. Just since 2008, the amount of federal workers employed in regulatory activities has increased by 20 percent.

Another blatant impediment to a genuine economic recovery is the profligate spending in Washington D.C. The increase in federal outlays since 2008 did not stimulate the economy, but rather sedated it. The more the government spends, the less the private sector can invest.  As Milton Friedman put it, a government taxes what it spends, so spending increases have the real effect of higher tax rates on the private sector. Since governments have no resources of their own, they have to obtain their fundings by robbing the private sector of its capital. That is, when governments spend money, whether through taxing, borrowing, or inflating they displace resources from the productive sector of our economy and squander it on wasteful projects, such as Solyndra.

A recovery built to last must come from the only productive part of our economy, which is the private sector, not the public sector. In order to allow the private economy to fire on all cylinders, producing a recovery strong enough to reverse the damage done from the recent financial meltdown, the federal government must remove its grip on the economy with large-scale cuts in spending and onerous regulations.

Daniel Wilson is a recent graduate of James Madison University and holds a degree in economics.

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VC Note:  I’m pleased to share a guest post from Melody Scalley, a Virginia talk-show host and entrepreneur who resides on the Eastern Shore.

Image from gettyimages.com

Unless you have a high paying government job, and even if you do, you are probably well aware that the majority of American’s are deeply impacted by the ongoing devastation to the United States economy since President Obama took office.

While overall the unemployment rate hovers close to 9%, minority unemployment remains consistently near 15% and these figures show no indication of significant improvement in the near future.  Meanwhile, the current administrations lack of a positive Energy Policy is not only hamstringing companies that could add much needed AMERICAN JOBS to the economy; it is also compromising our long term national security and unnecessarily delaying our economic recovery.

The U.S. Energy Information Administration (EIA) recently released a report that shows the U.S. is on track to actually export a net increase in gasoline, diesel and other oil-based fuels in 2011 for the first time in 62 years.  This is due to the fact that while our economy is stalled, the economy in emerging markets is booming.  However these record exports are not forecast to continue.  EIA is also predicting domestic oil production will fall 240,000 barrels/day through 2012, mainly due to the continued Gulf “energy freeze” imposed by our current administration.

The United States has the highest standards for environmental protection in the free world.  Other countries do not endeavor to protect the environment for future generations as we do, yet their lack of concern for the environment will affect all of us.  We have the desire to be good stewards of the environment as well as the technology to extract our resources in a safe and efficient manner.  The U.S. also has the most stringent work place safety requirements of any nation.  We have the energy resources right here within our borders.  If President Obama wanted to put American’s back to work he has an entire industry waiting for the green light to help him turn around our economy.

I grew up in New Orleans and my Dad worked on the oil rigs.  I can attest first hand that oil industry jobs keep food on the table, the lights on and the rent paid.  If we simply used the God-given resources we have in our great Nation, many American’s would not be needlessly losing their homes and struggling to keep their lights on and their families fed.

We still import over half of our oil and petroleum products.  Instead of selling our debt to China we should be selling our OIL to China and reducing our national debt.  We do not lack the resources in America.  What we lack is leadership and the political will to demand our administration put forward an energy policy that is beneficial to Americans and the United States.  Let’s start the New Year on the right path.  It is time to resume drilling within American borders and stop exporting American jobs.

If you are interested in hearing more of Melody Scalley’s commentary, reports, and interviews, you can find her on the radio at WESR FM on Thursday from 6 PM to 9 PM or also by visiting her website, http://melodyscalley.com/.

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VC note: This article was written by Karen Kwiatkowski, a retired U.S. Air Force Colonel, resident of Shenandoah County, Virginia, and Republican candidate for the 6th district Virginia House of Representatives seat.  It arrived in my inbox a few moments ago with a request to have it posted on this site.  Given that I believe voter education is extremely important, I will almost always feature articles from our elected officials and those seeking office.  Thanks to Mrs. Kwiatkowski for sending it to me.  I hope you all find it enlightening.

“Conservatives” in Congress – Are They For Real?

While we wait to find out if Mr. Obama’s “national credit card” will long endure, many conservatives in the House and elsewhere are hoping that they can come out of the debt ceiling debate looking like constitutionalists.

Unfortunately, the cuts they’ve proposed thus far don’t cut very deep.  We should all be wary of current Cut, Cap and Balance proposals – setting standards based on today’s unbelievable levels of government consumption and waste would be a major mistake for the country, our children and grandchildren.

What about reining in that “national credit card?”   And what about the real cuts conservatives should be proposing, and are not?   Think about:

  • Foreign aid!  Why isn’t foreign and security aid to already wealthy and/or well-armed countries on the table?  While all recipient governments seem to expect it, it’s not fair to talk about cutting social security benefits or next year’s COLA for retirees when we keep the foreign aid spigot wide open.
  • Military streamlining!   Apparently, nothing in the military budget can be cut, even though it seems to leak money from all corners, including millions in indirect payments to the Taliban.  It’s not about almost 11 years of war in Afghanistan, or hundreds of Americans who have died or been mentally and physically maimed in that conflict.  It is about ongoing fraud and waste and a lack of clear DoD strategy that should not be rewarded by unlimited cash flows from Washington.
  • USDA and EPA grants and subsidies! Where are these programs are being cut  – even the 6th District’s long desired elimination of the ethanol subsidy is just “talked about.” Who fights against unneeded and counterproductive subsidies?
  • Congressional salaries!  A lonely proposal last February by Representative Giffords to reduce Congressional pay by 5% for a short time has languished for lack of interest.   Why haven’t federal salary and bonus reductions, and a federal hiring freeze been put on the table?
  • Obamacare!  Healthcare reform funnels more private resources into deep government ruts.  Why isn’t the widely unpopular Obamacare part of the cut list?
  • Big business and big bank bailouts and subsidies!  The Government Accounting Office (GAO) just  reported that the Federal Reserve made available (on the backs of our children and grandchildren) $16 trillion during 2008!  The current administration has placed even more on the “credit card” than did his predecessor.  This insanity should stop!
  • How about defunding the TSA, and cutting the DHS budget!   My goodness, people might actually want to take chance on a commercial flight during a TSA “holiday.”

The list could go on and on, and small savings add up to conservatism.  Freedom, too.  Why don’t we do something really radical, like letting the U.S. Constitution serve as a guide to federal spending?   Instead, we have a 6th District representative who has voted for more out-of-balance and unconstitutional budgets in his nearly 20 years we can count, all while telling stories about how “conservative” he is.

The U.S. visa lottery legislation sponsored by Mr. Goodlatte is typical and instructive.   To most 6th district voters, it sounds like a reduction in immigration – but the proposal he backs doesn’t actually reduce anything.  Instead, it converts Green Card Lottery with the just as costly to manage Employment-Based Green Card, authorizing the same number of 55,000 new visas each year – only this time to those foreign-born graduate students who have an advanced degree and are sought by a U.S. employer.  I support the free market in labor, in goods and services.   But at a time where 1 in 5 American men, including many with advanced degrees, are currently unemployed and under-employed, it seems a bit misleading of the 6th District Representative to advocate ending the Visa lottery as a way to appeal to anti-immigration sentiments and job-seekers at home.

This bait and switch routine reminds me of Mr. Goodlatte’s recent sponsorship of a bill that will maintain a 100-mile Federal zone north of the Mexican border to “enforce” border security (H.R. 1505).  Sounds good, if you don’t care about the private property of ranchers that may be included for federal rough-riding under “USDA” control through rancher participation in CRP, CREP, EQUP and CSP programs.  Sounds good, unless you believe, as I do, that the constitution requires we defend our actual borders.

I wonder, along with many in the 6th District, “Are the conservatives in the House of Representatives for real?”

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