A few days ago, I posted a link on my Facebook account to an analysis of the unemployment figures that are being reported as having improved considerably over the last few months. I don’t know how everyone else out there is feeling about it but it doesn’t feel right to me. So I started looking at the BLS number myself and noticed that they are adjusting the way they are reporting the numbers, or you might say manipulating the data for the benefit of those who would like to create the impression that things are getting better. The link I provided is a unbiased analysis of the workforce statistics and benchmarks them at the traditional method of analysis and reporting rather than the skewed method that is being used currently to make the numbers look more favorable than they are. Here is my post and the link:
Think Unemployment numbers are getting better? Believe your gut not the media. Take a look at this link then think again about what you are hearing in the media.
http://www.zerohedge.com/news/
The reactions I received were interesting, and one in particular, from my sister, whom I love, but share some ideological differences with, made me pause. Here are her two posts:
· Rosanne Roskelley Oh come on!! Obama didn't create this mess do you remember Bush!!
January 6 at 7:40pm · Like · 
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As I mentioned in my opening post, I am somewhat slow to respond to these types of comments but in this case I feel it is worth it so I am dedicating this post to my sister, and hope that after reading this she doesn’t take too much offence.
It is interesting; the things that we have an emotional, sometimes even visceral reaction to. Nowhere in my post did I mention our current President, or suggest blame for the current state of the economy to him. I have not had any conversations with my sister about any socio-political issues for years, unfortunately due to our physical distance between us, we rarely see or speak, yet merely at the suggestion that the unemployment numbers are not as reported by the media currently, the reaction would seem to suggest that I am blaming the current administration for the economic situation. Not only is the suggestion that our current president is not to have any responsibility, but the follow up post clarifies that that in reality it is all the prior presidents fault, that our situation was merely inherited by the current president and our prior president’s success was entirely due to his good fortune of having inherited a robust economy from his predecessor and rode it for not one but two terms. If you follow this logic back far enough, no one can or should take credit for the economic success or calamities of their administration. Obviously I do not subscribe to this line of thought and certainly have an opinion I would like to share. But first things first I must respond to my sister’s post so bare with me:
Yes, I do remember George W. Bush, very well, I remember his predecessor as well, Bill (philanderer) Clinton, and the prior Bush – George Herbert Walker, I remember Ronald Regan as well, who from your point of view must have inherited a wonderfully robust economy from his predecessor, yes, I remember Jimmy Carter. In fact I even have some memory of his predecessor, Gerald Ford and Richard Nixon. Sorry while I may remember some events that occurred during the prior administration, I have very little recollection of Lindon B. Johnson who was President when I was born so my knowledge of his administration and all of the wonderful things that occurred and brought our country together in the mid to late "sixties" (ahemm a bit of sarcasm) come from my study of events and not from personal experience as they may for you as my “older sister”. Unfortunately, I do not connect to my memory of the Bush administration, all of the ills that you evidently place on him.
I do agree that he was a more progressive spender than I would have preferred, and I will give you that he was not as polished a speaker as his predecessor or our current President (as long as he has his prompter in front of him at least) but then I don’t recall the moral integrity issues of president Bush as I do of his predecessors and I somehow missed the radical musings in President Bush’s memoirs of his youth, or his stated desire to fundamentally change our form of government and society to a more European socialist model as our current President is hard at work doing. Maybe you have a point, maybe my memory is clouded, slanted or just not worthy of consideration. So let’s take a different approach to the topic at hand which if I remember correctly was the distortion of unemployment figures.
Why would such a post create such a reaction? The facts are what they are. Unemployment is vastly higher than should be accept able to any us, the occupant of the Whitehouse included. Responsibility for the current situation must be borne by the policy setter of the moment in order for appropriate action to be taken. I have listened now for 3 years while our current president has attempted to deflect all responsibility to others and now wants us to give him four more years to continue the policies that he has set in place.
In the clarifying second post, two reasons were given as to why we are in this “mess” (both attributed to President Bush) and accolades were attributed to President Clinton and his “Budgetary Surplus” that was “mishandled” by President Bush. While I do not agree with the premise of blame, I do subscribe to the causal rational of the effect of governmental management (ie: regulation setting) and excessive spending on the health of our economy so let’s take a look at the spending side of this issue.
Let us first make a clarification to spending terms because in the post there is a potential of confusion. There is a vast difference between budgetary spending resulting in a potential surplus and the “Debt” which is related to what we call deficit spending or the longer deficit of the country. The first is an annual fiscal figure that is always manipulated and is never calculated form a zero basis as we would in business budgeting. Rather it is a projected number which is reported on an expected increase over current spending levels and when the expected level of spending is not reached it is counted as a surplus. Some administrations have been better at managing public perception of this expected increase in annual spending than others and have been able to reap the perceptive rewards of a “budgetary surplus”. This is akin to the adage that if you buy something on sale that you didn’t really need, you saved when in reality you still spent money that you didn’t need to but because it was less than if you paid full price you did well. In reality, unless you have an unlimited source of funds, this entire methodology is flawed regardless of who is using it or reaping the benefits. The latter, or more important and telling number for analysis is deficit spending or an increase to the total debt obligation of the country. Yes, President Clinton did have a “budgetary surplus”, but what was the real impact of his and other administrations on our countries long term debt situation, the number that really matters to the fiscal health of our monetary system? You guessed it, President Clinton was a deficit spender just like all of our other administrations in the 20th century. What about President Bush? Yes, absolutely he was a deficit spender, and President Obama, well let us just say we haven’t seen nothing yet, including his current fiscal projection, he will, by the end of his first term have amassed a cumulative deficit level that will more than double all of his predecessors in the history of our nation combined.
If you would like unbiased analysis with detailed information on all levels of governmental spending, please visit this incredible site that compiles raw spending numbers for the last century and provides concise analysis in fairly basic terms: http://www.usgovernmentspending.com
The solution to our problem is one of basic fundamentals. There is no magic built and it is going to hurt. But it is possible. We all should know the answer because we live in a tangible economy that requires payment for goods and services. Our freedoms and liberties depend upon it. Our republic form of government was meant to ensure it, but we have, and are, at an alarming rate departing from the proven economic principles that have made us an exceptional country and economy for the past 200 years.
What does this have to do with unemployment? Well, while a bit misguided in analysis and casting of blame, my sister hit the nail on the head. It is about the management of the economy, the policies, regulation and climate of investment. It is also about the responsibility of our government in constraining spending within the bounds of actual revenue (tax receipts not GDP) which has long been a neglected element of monetary policy to the point of our country reaching fiscal insolvency.
So who is to blame? What is the responsibility of the president, and congress? How do we fix unemployment, increase tax receipts, and lower our deficit such that we can remain an exceptional country and return to an exceptional economy? Well the answer shouldn’t, but might surprise you. That will, along with a foray into the 2012 presidential race and the stakes that are at play, will be the topic of my next post.
Let me know your thoughts, after all we are the responsible party – so to speak, whatever your affiliation, or not, what you do does make a difference!
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