In his late-September interview with Steve Kroft of CBS News, President Barack Obama insisted that, when looking at the economy and asking “are you better off than you were … six (years ago),” “the country is definitely better off.” Unfortunately, he admitted, the American people “don’t feel it.”
One reason “they don’t feel it” is because, despite what the President contends, there are many areas of the economy which aren’t in better shape than they were six years ago. One obvious sector which is still worse off is the homebuilding industry.
The Census Bureau reported Friday morning that new home sales in September came in at a seasonally adjusted annual pace of 467,000. That was barely ahead of August’s revised total of 466,000. The really sad part of the Census’s release is that August originally came in at 504,000, but was revised downward today by over 7 percent.
Actual sales in September (i.e., not seasonally adjusted and not annualized) amounted to only 38,000 units.
338,000 new homes have been sold during the first nine months of this year. That’s almost 16 percent below the comparable figure of 401,000 from 2008, i.e., six years ago. Even given the steep slump which occurred during the final quarter of 2008, new-home sales in 2014 will still certainly come in below that seen in 2008.
Why is this happening? Obama gave Kroft the reason: “… incomes and wages are not going up.”
His “solutions”? Obama wants to raise the minimum wage to $10.10, which would steeply raise prices, reduce business profits, and lead to reduced employment.
The President also is pushing to “make sure women are getting paid the same as men for doing the same work.” That idea requires no action, because equal pay for equal work is already the reality, both in the law and in practice.
Obama believes we should also be “doing more to invest in job training.” That means doing more of what hasn’t worked. The New York Times recently exposed how the Workforce Investment Act, an existing job-training effort, has generated no real results for many supposed beneficiaries besides pushing them deep into debt.
Housing in particular is suffering because, thanks to the Dodd-Frank banking regulations passed during early part of Obama’s first term, lenders are looking over their shoulders, worried that Uncle Sam’s busybody auditors might second-guess their underwriting decisions and put them through the regulatory wringer. Even people with golden credit and plenty of other financial assets are finding it extraordinarily difficult to navigate their way to a new mortgage loan.
Today’s new-home news only reinforces the fact that after almost six years of Obama’s alleged recovery medicine, the patient is nowhere near recovering.
Cross-posted at DC Gazette.