Filed under: Capitalism, Economy, Election 2012, Politics, Progressivism | Tags: Job Creation, Obama, Recession, Unemployment
President Obama held a press conference today, and managed to commit a terrible gaffe. He said “the private sector is doing fine.” Here’s the whole quote:
The truth of the matter is that, as I said, we created 4.3 million jobs over the last 27 months, over 800,000 just this year alone. The private sector is doing fine. Where we’re seeing weaknesses in our economy have to do with state and local government. Oftentimes cuts initiated by, you know, Governors or mayors who are not getting the kind of help that they have in the past from the federal government and who don’t have the same kind of flexibility as the federal government in dealing with fewer revenues coming in.
James Pethokoukis, who is very good at this kind of thing, says:
Private-sector jobs have increased by an average of just 105,000 over the past three months and by just 89,000 a month during the entire Obama Recovery.
In 1983 and 1984, during the supply-side Reagan Boom, private sector jobs increased by an average of 292,000 a month. Adjusted for population, that number is more like 375,000 private-sector jobs a month.
(Aside:) I wonder how many people are just turned off, at this point, by more numbers. The efforts to make American students love math have not been very successful, and it may be hereditary. When your kid brings home some math problems that he can’t figure out — how many parents just make the situation worse, and continue a distaste for math in another generation?
To keep it simple, I wrote down this number from a reliable source, I just don’t remember who it was. To keep up with population growth, we would need to add 125,000 new jobs each month. So we would need 1,500,000 new jobs in the last year, so Obama’s job creation came up 700,000 short. Or to take James Pethokoukis’ average number of 89,000 a month — Obama would have needed 1,068,000 jobs in the last year to keep up with his own average. 800,000 just won’t cut it. Somebody’s math here is wrong.
Somebody apparently alerted Mr. Obama to what he has said in the press conference, so he rushed back for the nearest microphone to say no, he didn’t mean that “the private sector was doing fine.” What he meant was that Congress had to stop being lazy and not doing anything and pass his jobs bill. Congress has no interest in passing his jobs bill, and has rejected his budget unanimously.
The President has held 16 ‘campaign events’ over the last 7 days and flown in Air Force One to 6 states. More campaign events that all previous presidents, but he likes campaigning, it is the actual job of being president that he doesn’t seem to care for.
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American Elephants 
Kinda interesting how Pethokoukis takes the average for a whole year under Reagan and compares it to a selective 3 months under Obama. By that process he could have compared it to Dec 2011-Feb 2012 when 200,000+ jobs were added each month. That 600,000+ job number would have caused that Reagan comparison to teeter a bit wouldn’t you say? But of course focusing on the last 3 months worked better for Pethokoukis to make his point.https://americanelephant.wordpress.com/wp-admin/edit-comments.php#comments-form
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Comment by Mashed Potato Bulletin June 8, 2012 @ 8:36 pmI don’t know where you get the whole year vs. 3 months. Pethokoukis is probably talking about fiscal year, but even if he were talking calendar year, we’re 6 months into the year. There have been periods that are better than others, but you are missing my point. The economy adds 125,000 new workers to the potential work force each month. Even 200,000 new jobs doesn’t cut it. We need much more vigorous growth. Read my piece again, and follow the links. The piece from which I took information might include more that helps to make things clear.
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Comment by The Elephant's Child June 8, 2012 @ 8:57 pm“I don’t know where you get the whole year vs. 3 months”
Right here, “…increased by an average of just 105,000 over the past three months” and “In 1983 and 1984, during the supply-side Reagan Boom, private sector jobs increased”
“There have been periods that are better than others,”
Same can be said about the recovery and any other economic period.
“The economy adds 125,000 new workers to the potential work force each month. Even 200,000 new jobs doesn’t cut it.”
Actually that number fluctuates so much depending on the source you look at. I’ve seen range from 160,000 to 200,000 each month. Sure we need more vogorous growth but as we’ve seen the cuts in public sector employment have negated MANY of the gains achieved in the private sector. The problem is demand. Demand is the primary driver of economic growth and is what businesses pay attention to when deciding as to whether to hire. Taxes benefits and cuts are a far 2nd when it comes to demand.
The facts still remain, we’ve seen the addition of 4.2 million news jobs under Obama, almost the total that were lost since he took office. GDP has increased from 0.4% in March 2011 to 3.0% in Q4 2011. It dropped to 2.2% in Q1 2012 but seeing how the historical average is about 3.8% in health economies we’re not doing too shabby. And the private sector has been hiring for 27 straight months.
I did look at the links you provided and that one for Pethokoukis and his assessment is just not accurate when the figures I just provided here are considered. He’s looking at short-term figures and not at the bigger picture.
This is a decent piece to look at for more information;
http://abcnews.go.com/blogs/politics/2012/06/is-the-private-sector-really-doing-fine/
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Comment by Mashed Potato Bulletin June 9, 2012 @ 9:21 pmJames Pethokoukis is talking averages, and you can take anything he says to the bank. He’s very good. But we are not going to agree. We have a partisan divide here. President Obama brags that he has created 4.2 million new jobs, but the long term unemployed have grown to over 88,319,000 who have simply given up looking for work. You undoubtedly regard Paul Krugman as an important economist, I regard him as someone who used to be an economist until he started writing a regular newspaper column and became a political hack. We have had 11 recessions and 11 recoveries in the last 60 years, and this is the worst recovery of all. Obama has been on a spending binge that largely went to cronies, and accomplished nothing whatsoever for the economy. He has increased the national debt by $5 trillion and the CBO says it will double in just 15 years. We are in real trouble.
The problem is NOT demand, and all the John Maynard Keynes stimulus won’t do a thing to help. You might get a small temporary bounce, but it will not help the economy to recover. Never has. All Obama’s stimulus was wasted. Even Keynes discarded his ideas. Conservative ideas about economic recovery worked for the Coolidge administration, the Kennedy administration, the Reagan administration and the George W.Bush administration.
Government jobs don’t really add to the economy, they are paid for by extracting money from the public in taxes. Private sector jobs, on the other hand create economic growth because they create something new: a new hamburger, a new car, a new idea, a new service, a newly cleaned suit of clothes. I said this before: see “Presidential Misunderstandings” on the main page.
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Comment by The Elephant's Child June 10, 2012 @ 1:43 am“James Pethokoukis is talking averages, and you can take anything he says to the bank. He’s very good.”
Not from the numbers and figure he’s putting out there. He’s simply not accurate.
“President Obama brags that he has created 4.2 million new jobs, but the long term unemployed have grown to over 88,319,000 who have simply given up looking for work.”
Where did you get that number? Such a precise figure considering that the BLS does not indicate the reasons for people dropping out of the workforce. People drop out, yes, because they are discouraged but they also leave to go to school, to retire, to start their own home-based business (an area that has been growing with leaps and bounds over the last couple of years). But the BLS doesn’t delineate those numbers.
Are you actually saying that 28% of the entire US population are discouraged, out of work people?? Partisan divides or not, that is an incredulous figure.
And once again the 4.2 million is very impressive when you consider 4.3 million were lost since Obama took office. Regaining virtually all those is definitely a figure to stand by.
“You undoubtedly regard Paul Krugman as an important economist,”
Quite an assumption there. Where did I mention Krugman at all in any of my responses? Yes, I have read him but no I do not rely on him, particularly given the perception of him by the Right as a far-to-liberal columnist. I don’t use him as a reference.
“We have had 11 recessions and 11 recoveries in the last 60 years, and this is the worst recovery of all.”
LOL!! Yeah… do you know why??? Because this is the worst one since the Great Depression. It beats all those others for depth AND breadth. Many recessions impact a couple of sectors, this one, like the Depression hit virtually every economic sector and hit it HARD. You cannot compare those others with this one simply because they did not reach the depths this one did.
I invite you to peruse this graph from Calculated Risk, a highly regarded financial and economic blog for a very useful illustrative, comparative view of this recession and others since 1948;
http://www.calculatedriskblog.com/2012/02/employment-summary-part-time-workers.html
Scroll down to the 1st chart in the ” Percent Job Losses During Recessions” section.
Yes it only looks at unemployment BUT it still provides a very clear picture of the difference between the Great Recession and those others.
“Obama has been on a spending binge that largely went to cronies, and accomplished nothing whatsoever for the economy.”
Recent assessments have this highly repeated talking point from the GOP to be quite incorrect. It’s part of the whole “invented Obama” the Right has created, an individual that couldn’t resemble the actually person occupying the Presidency any less.
http://www.politifact.com/truth-o-meter/article/2012/may/25/lots-heat-and-some-light-obamas-spending/
“He has increased the national debt by $5 trillion and the CBO says it will double in just 15 years.”
No, HE hasn’t… the RECESSION has. Due to the ~8.4 million people who lost their jobs throughout the recession (most between Sept 2008-April 2009) the tax revenue for governments (local to federal) took a massive hit, thus giving many no choice but to resort to debt spending to cover the bills that still needed to be paid from years past.
“The problem is NOT demand, and all the John Maynard Keynes stimulus won’t do a thing to help.”
Sorry but it is. Demand IS the primary concern for business. You’re attachment to the “Obama stimulus didn’t work” claim is another wholly debunked and outdated assertion. Keynes did not discard his own ideas… PLEASE where do you come up with this stuff??
Let me ask ya this. A business is offered a $4000 tax cut for hiring a new employee but it costs them $8000 to hire a new person. In addition, demand is low. So the business weighs the choice… get a $4000 tax cut and hire someone costing the company $4000 after taxes to sit on their butt and do nothing. (This is an actual example given by a company during the whole debate over more tax breaks for businesses). They DO NOT hire people for the sake of hiring. They hire people to meet demands for the products or services they provide.
“Conservative ideas about economic recovery worked for the Coolidge administration, the Kennedy administration, the Reagan administration and the George W.Bush administration.”
Untrue. Coolidge….maaayyyybeeee. I’m not going to go look it all up. Keynes was the standard up until the 70’s. When supply-side economics (trickle-down theory) for some ridiculous reason began to gain favor.
But you’re also wrong about Reagan and GW… both employed stimulus measures during the recessions they dealt with.
“Government jobs don’t really add to the economy, they are paid for by extracting money from the public in taxes.”
They most certainly do add to the economy. They provide jobs to working people and their families who then go on to spend that money on goods and services in other industries thus increasing demand for those products and so on….
“Private sector jobs, on the other hand create economic growth because they create something new: a new hamburger, a new car, a new idea, a new service, a newly cleaned suit of clothes. “
Uh huh… and what about ALL that infrastructure those private sector companies utilize to produce, and transport their products and services? They couldn’t do it without the development and maintenance of those infrastructure systems put into place by all those government projects now could they?
You also forget all the advancements we’ve made through government-private business partnerships. So much of what we have today is a product of those very cooperative efforts. This so often forgotten within the “government is evil” rhetoric that ALWAYS comes out in tough times.
So let’s just stop with the revisionist history, the emotionally charged rhetoric and subsequent baseless beliefs and start paying attention to the facts. It’ll make all our lives so much easier if we just stop buying into all the bs.
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Comment by Mashed Potato Bulletin June 10, 2012 @ 1:02 pmYou are repeating the president’s claims as if they were accurate. They are not. This was not “the worst recession since the Great Depression,” it was not even close. Obama didn’t expect that the presidency would involve hard things like economics. Rham Emmanuel set up daily economic briefings for Obama, but they bored him, and he quit them early on.
Obama was told by his economic advisers that he had to deal with the economic situation to the exclusion of much of anything else, but he said that wasn’t enough for him, and embarked on health care, which Americans didn’t want, an Auto bailout — giving a big chunk of GM to the unions, while putting hundreds of independent businesses, the auto dealers out of business. He has thrown billions away, or rather enriched his corporate cronies by shoveling money into useless “green” efforts, and killing thousands of jobs in the energy industry.
There is no point to this discussion. You are a leftist. I am a Republican. You claim my information is faulty, and refer me to sources that I reject. We will agree on nothing, and it is a waste of time for us both.
The 88,319,000 figure I believe came from Zero Hedge, I don’t quite remember. It represents the people who are of working age but have given up looking actively for work. HP has just announced a layoff of 24,000 people. I come up with this stuff by regularly reading a list of around 50 economists, a lot of history, and the work of a large number of think-tanks. Keynesian economics has been a standard on the left, who accept it as holy writ. Republicans reject it because the evidence proves that it does not work. The Great Depression was “Great” because FDR made such a mess of it. My history is quite accurate, but rejected by the left, who don’t know any better. I would recommend Amity Schlaes The Forgotten Man or Gretchen Morgenson”s Reckless Endangerment. You completely misunderstand what Republicans advocate, you are unfamiliar with economic history, and arguments that just accuse each other of being inaccurate are pointless. Sorry.
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Comment by The Elephant's Child June 10, 2012 @ 3:38 pm“You are repeating the president’s claims as if they were accurate. They are not.”
I’m not repeating anything, I am reporting facts as I have found them in a number of articles from reputable news agencies. I do not reference or quote the administration or more liberal sources when debating people of opposing views because they will simply dismiss them as “liberal biased” citations no matter how well performed the analyses are.
“This was not “the worst recession since the Great Depression,” it was not even close.”
If this is truly what you think then you have no comprehension of the actual history of 20th Century United States. And if this IS indeed what you think then I’ll have to say we are done with this little debate because you would have been ingrained with such a skewed view of history that it is not in my interest to go round and round with one who could be categorized as a “true believer”. However, if you are rational and can look at the accurate events that transpired over the last century then we can have an intelligent debate.
“Obama didn’t expect that the presidency would involve hard things like economics.”
Uh… again…where do you get your information??? He knew precisely the mess he was entering into and comprehended the seriousness of the economic situation. No ONE knew exactly what would happen simply because there was no one left alive working in government who has dealt with such a mess before.
“Rham Emmanuel set up daily economic briefings for Obama, but they bored him, and he quit them early on.”
LOL!! Yeah okay. Well gee… no source, no reference to where this is coming from so again, I will have to call bs on ya.
Okay, after reading the rest of your post I just realized I could spend the entire day and beginning of the following week debunking every single sentence all to no avail. Because no matter how many pieces of evidence I provide you will not believe them. You my friend have been seriously sucked in to a reality that just does not exist. I am a scientist and highly educated and know very well how to judge factual information. I am very comfortable in the sources I utilize and assess. On the other hand the information you so ardently believe in does not stand up to qualified assessment. Much of it has been debunked and thoroughly dismissed through numerous factchecks and the like. Or it is simply ill-informed speculation. Unfortunately, this steadfast “belief” in anything anti-Obama has created a wall against anything that threatens those beliefs no matter how factually accurate that new information may be. Your comment here only serves to support my conclusion, “You claim my information is faulty, and refer me to sources that I reject. “ You reject them because they threaten those beliefs that have become so intertwined in your worldview.
So it is quite obvious we can agree to only one thing and that is, “There is no point to this discussion.”
I do hope that one day those many, many people on the Right, yourself included, will one day find a way to break free of “belief” and begin to listen the facts. Good luck.
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Comment by Mashed Potato Bulletin June 10, 2012 @ 5:40 pm