Saturday, October 6, 2012

Christmas in October

I’ve said it before, I’ll say it again: Barack Obama is the luckiest president running for reelection in over a generation.  Two days after Lex Luthor stole his lunch money in Denver, the Bureau of Labor Statistics released its September Jobs’ Report.  As expected, the economy added 114,000 jobs.  However, what was NOT expected, and came as a huge shock, was that the unemployment rate fell to 7.8 percent, the lowest it’s been in almost four years.

Why the sudden drop in unemployment with only a modest uptick in jobs?  Because the number of people who said they were employed increased by 873,000.  In addition, wages rose in September as more people entered the work force.  Normally that would drive the unemployment rate up because of an increase in participation rate.  But with the increase of 873,000 workers, plus an upward revision of 67,000 jobs going back to July, the actual jobless rate fell.  The economy has now netted 325,000 jobs since Obama became president, an incredible statistic given that it was losing over 750,000 jobs per month when he took office.

As you would expect not everyone was ecstatic over the good news, especially since it came a month before the presidential election.  Suffice to say there were more than just a few, shall we say, skeptics, virtually all of them Republican.  Given that no president since FDR has been reelected with unemployment above 8 percent, the obvious assumption was that the Administration somehow cooked the books. The Right was simply beside itself.

The most amusing rant came from Jack Welch, former CEO of General Electric, who tweeted: “Unbelievable jobs numbers..these Chicago guys will do anything..can't debate so change numbers.”  You’d expect that kind of drivel from a Rush Limbaugh or a Marc Levin or a Donald Trump, but not from a former head of the one of the largest corporations in the world and one of the ten most respected businessmen in the country.  CNBC’s Rick Santelli, likewise, added his own two cents.  “I told you they'd get it under 8 percent -- they did! You can let America decide how they got there!”

This isn’t the first time this idiotic claim has surfaced.  Back in February, after a unexpectedly robust January job’s report dropped the unemployment rate all the way down to a still lousy 8.3 percent, the conspiracy nuts were all up in arms about how the BLS and the Administration were in cahoots with each other trying to get Obama reelected.  Funny how a movement that grew out of a belief that the government is completely inept has somehow managed to convince itself that that same government is capable of pulling off such a herculean feat as this without getting caught.  It's amazing what paranoia can do for you. 

Ezra Klein of The Washington Post had the best take on this:

The fact is that there’s not much that needs to be explained here. We’ve seen drops like this — and even drops bigger than this — before. Between July and August the unemployment rate dropped from 8.3 percent to 8.1 percent — two-tenths of one percent. November-December of 2011 also saw a .2 percent drop. November-December of 2010 saw a .4 percent drop. This isn’t some incredible aberration. The fact that the unemployment rate broke under the psychologically important 8 percent line is making this number feel bigger to people than it really is.

But psychology is what this really comes down to.  The perception that things might be better than they actually are is what appears to be driving Republicans over the edge.  It’s not that a drop of three tenths of a percent in the jobless rate is all that significant – indeed, as Klein correctly observed, a lot of this increase could be “seasonal hiring.”  It’s what that drop symbolizes to potentially millions of likely voters next month.

Yep, you guessed it.  The doomsayers have their panties in a bunch because the electorate might actually start to feel good about things and that could spell trouble for Mitt Romney’s hopes for an early Christmas present.  Appalling, but hardly unexpected.

As for Obama, he’s now four tenths of a point behind Ronald Reagan for the worst post- Depression unemployment rate for a sitting present.  Guess who won reelection in 1984? Ho-ho-ho.


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