June 6, 2008

Couldn’t Help But Comment (060608, Noontime)

Filed under: Economy,Environment,Taxes & Government — Tom @ 11:50 am

It occurs to me that at some point, the muddling-along economy gets to be about a 50-50 Bush-Reid/Pelosi proposition — at least as long as I’m seeing nothing but economy-dragging ideas like huge tax increases and frightening environmental laws being considered in Congress.

Congress is doing nothing but dragging down economic expectations, and then trying to capitalize on those gloomy expectations at the polls this November. I suspect that even a healthy majority of the 85%-86% of the electorate that is relatively disengaged — the ones they are hoping will be driven to despair by the press’s downbeat economic reporting — can see through this.

They’re ideologues, but they’re not totally stupid. I’m reading that the congressional majority is so scared of the Lieberman-Warner bill that they’re thinking about pulling it (HT to the indispensable CCnet e-mail). If there’s any way Mitch McConnell can force a vote on this enviro-nonsense, which “addresses” what Family Security Matters cleverly calls the Biggest Non-Problem in History, he should. Any Senator on the record in favor of this becomes instantly, and deservedly, vulnerable — and of course that includes co-sponsor RINO John Warner.

If Congress did a turnaround, shredded the tax increases, and actually made the Bush tax system that has been in place since 2003 permanent, the economy would pick up pretty quickly. It would zoom if they cut taxes further, by about 10% across the board, retroactive to 1/1/08. Those would be the right things for the country, but they are clearly not as important as the congressional majority’s political power calculus.

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One of the Senators who should be forced to go on the record for or against Lieberman-Warner is Ohio’s own junior senator, The Invisible Sherrod Brown. NixGuy reminds us that Brown was Mr. “Ohio Lost Jobs Because of Free Trade” during the 2006 campaign. If he supports Lieberman-Warner, especially given the recent job-cut announcements at DHL in Wilmington and GM-Moraine, he becomes Mr. “Killed More Ohio Jobs to Hug Trees.”

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Speaking of assigning responsibility, Nix also noted that Ted Strickland’s popularity, while still mostly intact, is still below Bob Taft’s at the same time in 2000. Ted can thank Ohio’s media for protecting him from the other major finding of the Quinnipac survey, which is that by a 65%-3% margin (not a typo), Ohioans think that “state economy has deteriorated under his stewardship and are very pessimistic about the future.”

58% of those who say the economy is worse blame Bush.

Hmm. If that’s so, someone will have to explain how and why the President wreaked targeted economic misery on the Buckeye State, while 41 other states “somehow” managed to turn in higher GDP growth last year — most of them more than 1% higher that OH’s dismal 0.4%. Only AK, NH, DE, RI, FL, WV, MI, and IN trailed.

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Just as I suspect Ohio’s mediocre economic performance and the shadow it could cast over Ted Strickland’s popularity is probably removing him from serious Vice-Presidential consideration, the same fate should befall Florida’s Charlie Crist. John McCain should run away from him — quickly.

Yesterday’s GDP by State report shows that Crist has done what seemed impossible 18 months ago, managing to muck up the Sunshine State with zero growth in his first year of office after eight amazing years under Jeb Bush.

While Florida drifts, Crist fiddles with globaloney.

The Government’s May Employment Report

Filed under: Economy,Taxes & Government — Tom @ 8:30 am

The Runup:

  • ADP’s National Employment Report came in at +40,000 seasonally adjusted private nonfarm payroll jobs. This whipped expectations that it would come in at -30,000 bigtime. Their +10,000 from April was revised up to +13,000.
  • Through the first four months of this year, ADP was showing +117,000 private nonfarm seasonally adjusted jobs added, while the government’s Bureau of Labor Statistics was showing -312,000. That’s a 429,000-job difference. I believe there’s reason to believe that ADP, which works with numbers of people paid, may be better at picking up changes in small- and medium-sized business hiring and firing than the BLS, which works with state employment-agency data supplemented with phone and other surveying. I posted on this issue yesterday. Something’s gotta give eventually. If you split the difference, the economy looks very different; if ADP’s right, the recession-obsessed are left with nowhere to hide.
  • Before ADP’s report, the prognosticators were guessing that BLS’s Employment Situation report would come in today at -50,000 seasonally adjusted jobs.
  • In the predictions department, despite the ADP result, the analysts’ response is apparently “That’s our story and we’re sticking to it.” As of late yesterday evening, this CNBC report was calling for -60,000 seasonally adjusted jobs and unemployment increasing to 5.1%. This MarketWatch report has -50,000 and 5.1%.
  • One thing yours truly will be keeping an eye on, especially since no one else will, is the BLS estimate of how many jobs were actually added in May, as opposed to the seasonally adjusted number that gets everyone’s attention. Revisions to actual adds in March and April also deserve attention. Here’s how it looks so far this year compared to previous years:

    BLSnotSeasAdj2005thru2008at0408

    If May’s actual adds are greater than each of the previous three years, that will be good news indeed. If it gets real close, I’ll take it.

The News (BLS report will be here when released; details below will be updated ASAP after the report is released):

The unemployment rate rose from 5.0 to 5.5 percent in May, and nonfarm payroll employment continued to trend down (-49,000), the Bureau of Labor Statistics of the U.S. Department of Labor reported today. In May, employment continued to fall in construction, manufacturing, retail trade, and temporary help services, while health care continued to add jobs. Average hourly earnings rose by 5 cents, or 0.3 percent, over the month.

Other quick details:
- Revision to April’s original -20,000 — now -28,000, down by 8,000
- Revision to March’s once-revised -81,000 (originally -80,000) — now -88,000, down by 7,000
- Total change including prior-month revisions is -64,000 (-49-8-7)
- Actual jobs added in May — 648,000
- Revision to April’s actual jobs added of +703,000 — up 9,000 to 712,000
- Revision to March’s actual jobs added of +580,000 — up 14,000 to 594,000
- Total change in actual jobs added, including prior-month revisions is 671,000 (648+9+14)

Unemployment Rate Highlights:
- Unemployment rate (NOT seasonally adjusted) — 5.2% (was 4.8% in April, 4.3% in May 2007)
- May change in the number of unemployed (seasonally adjusted) — 861,000 more (from 7.626 million to 8.487 million)
- May change in the number of unemployed (NOT seasonally adjusted) — 789,000 more (from 7.287 million to 8.076 million)
- African-American unemployment rate (seasonally adjusted) — 9.7% (was 8.6% in April, 8.4% in May 2007)
- African-American unemployment rate (NOT seasonally adjusted) — 9.4% (was 8.2% in April, 8.1% in May 2007)
- People working per the unemployment report (seasonally adjusted) — 146.046 million, down 285,000 (was 146.331 million in April)
- People working per the unemployment report (NOT seasonally adjusted) — 145.926 million, up 5,000 (was 145.921 million in April)

Comments:

  • This was the first time this week that expectations weren’t beaten in an economic report. Great timing (/sarc).
  • Looks like another month mostly like the previous three, in the sense that the number of real jobs added wasn’t up to the level of the three years preceding it:

    BLSnotSeasJobsAdded0508

    The 2,481,000 reals jobs added in the past 4 months still significantly trails the previous three years (2007 – 3,337,000; 2006 – 3,623,000; 2005 – 3,689,000). If there’s a silver lining, it’s that May’s real jobs added of 648,000 is much closer to the average of the previous three years (206,000 lower, or about 24%) than the previous three months were (35%, 34%, and 27% lower, respectively). But it’s not good enough.

  • The obvious pop-out is that ADP and BLS now diverge by even more than a month ago. ADP shows 157,000 seasonally adjusted private nonfarm jobs added this year, while BLS shows 397,000 lost. That’s a ridiculous difference of 554,000 jobs. My theory, noted yesterday and above, is that BLS is missing lots of small-business jobs that ADP is picking up on a more timely basis. Somebody has some explaining to do, but don’t expect the press to be curious when they’ve got another juicy negative number to work with.
  • Speaking of divergence, I don’t get how seasonally adjusted unemployment can go down 0.1% in a month where seasonally adjusted jobs shrink by 28,000 (as occurred in April, revised), but can then go up 0.5% in a month when the job shrink of 49,000 isn’t that much higher. I had an attempt at explanation here for a while, but I deleted it. I just don’t get it.
  • The press will treat today’s news as another reason to throw around the R-word, even though virtually every other report this week came in positive and beat expectations, and the seasonally adjusted job losses are nowhere near what we saw during the real recessions of the past.

I will cover press coverage of today’s news in a later post, probably late this evening.

Positivity: Port St. Lucie boy honored for saving classmate’s life

Filed under: Positivity — Tom @ 6:00 am

From Port St. Lucie, Florida:

Friday, May 23, 2008

Not all super-heroes come with bulging muscles, a cape, and X-ray vision.

Some are just kids like Dalton Frick.

What started out as a regular school day at Savanna Ridge Elementary about two months ago, ended up with an act of heroism when 10-year-old Dalton performed the Heimlich maneuver — a series of under-the-diaphragm abdominal thrusts to clear a blocked airway — on a choking classmate and saved his life.

Thursday, before an audience of teachers, family, and fellow students, Dalton received a special award from the school’s principal, Barbara Kelley.

“He is a quiet, respectful child who stepped up to the plate and is deserving of honor from the community for his good deed,” said Kelley.

Dalton mentioned that the school prohibits kids from eating hard candy or chewing gum on campus to guard against choking, but sometimes kids forget.

“I was glad to be the back-up plan,” he said.

Kelley did not release the name of the child Dalton helped, citing privacy laws, and neither the boy nor his family were available for comment.

Dalton’s father Jason Frick said his son’s actions were the result of his first aid training received in the Boy Scouts.

Dalton generally keeps a calm head, said his mother, Paula Agosto, and because he was the closest person he responded immediately. She said Dalton had performed the maneuver only once before the incident occurred.

The elementary school hero, who has been a Boy Scout for five years, said that when he saw his classmate in trouble, he rushed over because he thought it was the right thing to do.

When asked about his deepest motivation, Dalton recited, “On my honor I will do my best, to do my duty, to God and my country, to obey the scout law, to help other people at all times, to keep myself physically strong, mentally awake, and morally straight.” …..

Go here for the rest of the story.