Friday’s unemployment report from the Bureau of Labor and Statistics is anything but a green shoot. The official U-3 unemployment number is 10.2%. The broader and more comprehensive official unemployment number, the U-6, is at 17.5%. The U-6 counts all the people that want a job but gave up, all the people with part-time jobs that want a full-time job, and all the people who dropped off unemployment benefits because their unemployment benefits ran out. John Williams at Shadowstats.com suggests that real unemployment is actually running at 22%, which, by our calculation, is approaching Great Depression unemployment numbers.
The unemployment report may come as a surprise to those who have been following the Obama administration and mainstream economists like Paul Krugman. Here are some choice quotes from those we’ve entrusted with our economy:
President Obama (February 13, 2009):
"That’s a story I’m confident will be repeated at companies across the country — companies that are currently struggling to borrow money selling their products, struggling to make payroll, but could find themselves in a different position when we start implementing the plan,” Obama said. “Rather than downsizing, they may be able to start growing again. Rather than cutting jobs, they may be able to create them again.”
That’s our hope – that’s our hope. There’s no doubt that without it, that’s where we were looking: double-digit unemployment. That’s what we’re trying to forestall.
Nobel Prize Recipient and Economist Paul Krugman on the benefits of trillion dollar deficit spending (January 21, 2009):
I’m looking for the unemployment rate. I want to see the unemployment rate stay safely below 10 percent, which is by no means a foregone conclusion. And I want to see it coming down notably next year.
Larry Summers, Lead Economic Adviser to President Obama (January 18, 2009):
I don’t think so. I think while we’re going to see some substantial job losses, frankly what is important about the president’s program here is that it is going to contain what would otherwise be just a vicious cycle, people spend less, therefore they earn less. We’re going to contain this problem.
Ben Bernanke, Chairman of the Federal Reserve testifying before Congress’s joint economic committee (May 5, 2009):
Currently, we don’t think it will get to 10 percent. Our current number is somewhere in the 9s.
So far, no good. The policies recommended by Messers Krugman, Axelrod, Bernanke and Summers seem to be having the opposite of the intended effect. Tens of thousands continue to lose jobs, credit continues to contract, spending continues to contract, and personal credit & mortgage delinquencies are on the rise.
Luckily, America has a President in office who is changing the way Washington works from the inside out and is holding strong to the commitment he made in April of 2008.
Presidential Candidate Barack Obama (April 3, 2008):
Today’s job news is the latest indicator of how badly America needs fundamental change from Bush-McCain policies that have been devastating for working families and catastrophic for our economy….
Our economy is struggling because the American people are struggling, and simply bailing out investment banks on Wall Street will not help Main Street.
Thank goodness that there’s at least one elected official in Washington that doesn’t believe in bailing out investment banks on Wall Street to help Main Street!
Recent developments in the economy suggest that the recession is over, recovery has started and for the consumer, it’s business as usual throughout America’s shopping malls.
All sarcasm aside, we ask our readers to consider recent statements from the public and private sector in regards to the economy. Are things really getting better? Given what we’ve been told so far, is it prudent to put our trust into the very officials who have gotten us to where we are today?
Sources and Hat Tips:
- For a more detailed breakdown of the (Un)Employment report, we recommend Karl Denninger’s article Employment Report: OUCH
- Hat tip to Mish for the U-6 definition provided in this article
- Visit Shadowstats.com to view John Williams Charts on U-3, U-6, and SGS Alternative unemployment statistics