Saturday, October 6, 2012

Solid Jobs Report Spawns Crackpot 'Job Truthers' Movement, Robert Reich: The Politics of the Jobs Report


Solid Jobs Report Spawns Crackpot ‘Job Truthers’ Movement

The economy added 114,000 jobs in September and unemployment declined to 7.8 percent. Not great numbers, but paired with major upward revisions to previous monthly reports and taken in the context of a slowly recovering economy, the report was viewed as good news for America.

Unless, of course, you were hoping for bad news. And apparently quite a few of President Obama’s critics were — so much so that they suggested the Bureau of Labor Statistics was part of a vast conspiracy.

The leader of the “job truther” movement: former GE CEO Jack Welch.

“Unbelievable jobs numbers..these Chicago guys will do anything..can’t debate so change numbers,” he said on Twitter.

He had some friends in Congress too. Rep. Allen West (R-FL) tweeted “I agree with former GE CEO Jack Welch, Chicago style politics is at work here.” He added on Facebook that the jobs report was “Orwellian to say the least and representative of Saul Alinsky tactics from the book ‘Rules for Radicals.’”

FOX News’ Stuart Varney apparently sensed where his audience was going. Within minutes of their release he told viewers that “there is widespread mistrust of this report and these numbers.”

“How convenient the rate drops below 8% [for the] first time in 43 months, five weeks before the election,” he added later.

CNBC host Jim Carmer said he was pilloried by viewers for defending the BLS report’s integrity.

“This is very hot. You believe the number, you must be a card-carrying Communist,” he joked on the air.

Betsey Stevenson, a former chief economist at the Department of Labor under President Obama, said in a phone interview with TPM that the conspiracy theories were misguided in just about every way possible. For starters, the Bureau of Labor Statistics isn’t currently run by a political appointee. For most of Obama’s term, the commissioner was a holdover appointed by President Bush. The current acting commissioner John Gavin is a career BLS economist, not an Obama appointee.

The underlying data behind the BLS reports is also publicly released and used by analysts across the private sector and academia, meaning a conspiracy would have to survive scrutiny from trained economists of all political stripes.

Nor is there much time to cook the books at the top level if they wanted to.

“I worked for Secretary Hilda Solis and she didn’t know the job numbers until 8 a.m. on the day,” Stevenson said. “Which made my job very difficult, because I had to help her figure out what she was going to say when they were released.” The BLS releases the numbers publicly at 8:30 a.m. ET.

But conspiracy theorists are out in full force. Conn Carroll, a columnist at the Washington Examiner, noted that the Household Survey, which is used to calculate the unemployment rate, was more positive than the raw jobs numbers, which come from a survey of employers, and suggested that the true conspirators were unemployed Democrats:

Justin Wolfers, an economics professor at the University of Michigan, told TPM these kinds of fluctuations between the survey and payroll numbers were common.

“It’s not unusual — the household survey is a noisy measure, there’s no doubt about it, and that’s why most analysts rely more on the payroll survey,” he said.

Update: The conspiracy crowd may need to expand their theory to the private sector. The consensus from market analysts the day before the report was a 110,000 job gain. The private ADP survey, released earlier this week, found that US businesses added 162,000 jobs.


The Politics of the Jobs Report

Robert Reich: Friday, October 5, 2012

The White House is breathing easier this morning. The Bureau of Labor Statistics reports the unemployment rate dropped to 7.8 percent – the first time it’s been under 8 percent in 43 months.

In political terms, headlines are everything – and most major media are leading with the drop in the unemployment rate.

Look more closely, though, and the picture is murkier. According to the separate payroll survey undertaken by the BLS, just 114,000 new jobs were added in September. At least 125,000 are needed per month just to keep up with population growth. Yet August’s job number was revised upward to 142,000, and July’s to 181,000.

In other words, we’re still crawling out of the deep crater we fell into in 2008 and 2009. The percent of the working-age population now working or actively looking for work is higher than it was, but still near a thirty-year low.

But at least we’re crawling out.

Romney says we’re not doing well enough, and he’s right. But the prescriptions he’s offering – more tax cuts for the rich and for big companies – won’t do anything except enlarge the budget deficit. And the cuts he proposes in public investments like education and infrastructure, and safety nets like Medicare and Medicaid, will take money out of the pockets of people who not only desperately need it but whose spending is necessary to keep the tepid recovery going.

Romney promises if elected the economy will create 12 million new jobs in his first term. If we were back in a normal economy, that number wouldn’t be hard to reach. Bill Clinton presided over an economy that generated 22 million new jobs in eight years – and that was more than a decade ago when the economy and working-age population were smaller than now.

Both Obama and Romney assume the recovery will continue, even at a slow pace, and that we’ll be back to normal at some point. But I’m not at all sure. “Normal” is what got us into this mess in the first place. The concentration of income and wealth at the top has robbed the vast middle class of the purchasing power it needs to generate a full recovery – something that was masked by borrowing against rising home values, but can no longer be denied. Unless or until this structural problem is dealt with, we won’t be back to normal.

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