America’s Sham Economic Recovery
by Stephen Lendman
Official government data are manipulated. Credibility’s entirely lacking. Reported good news is hype. Grim underlying reality is suppressed.
The monthly Labor Department jobs report is typical. Progressive Radio News Hour regular economist Jack Rasmus calls the latest January one “largely statistical legerdemain.”
A reported 243,000 nonfarm jobs reported lacked credibility. Manipulation manufactured them. Even the Bureau of Labor Statistics (BLS) admits:
“The confidence level for the monthly change in total employment is on the order of plus or minus 430,000 jobs.”
With that level of accuracy why bother reporting at all. Monthly numbers are meaningless. January’s reflect the problem.
Rasmus said those allegedly created aren’t actual jobs. “They represent seasonal adjustments made to the raw data….” January numbers, in fact, reflect “an anomalous massive upward revision of the raw jobs data, due to assumptions about seasonality and (alleged) new business formations.”
Comparing actual versus seasonally adjusted figures shows marked differences. Data reported for December 2011 and January 2012 revealed “an incredible 7 to 10-fold increase in the difference between” seasonably and non-seasonally adjusted figures.
For January, raw data showed large job losses, not gains. Included were “about 300,000 construction jobs, another 600,000” retail ones, and “400,000 in business professional services as most businesses trim their labor force at the start of the year to keep costs down.” In addition, hundreds of thousands more were lost for a 2.7 million total overall.
Reporting 243,000 new jobs denies reality. In fact, it’s worse. It’s Obama administration propaganda to make unemployed workers think their troubled status doesn’t reflect falsified improving conditions.
It’s an election year stunt, an official lie, turning reality on its head for votes at a time America’s experiencing a Main Street Depression affecting jobs. It replicates the 1930s. True unemployment’s at 22.5%, not the fake 8.3% U-3 number reported to hide the dark truth.
Headline numbers exclude discouraged workers. They want jobs but gave up looking after futile months trying. Moreover, no distinction is made between full-time employees and others forced into low pay, low or no benefit menial part-time/temp ones.
Statistically, a job is a job is a job no matter how poor or few monthly hours worked. Of course, this type reporting denigrates those unable to make ends meet in hard times. According to Census data, they represent half of US households defined as impoverished or bordering on it. That reality should shock everyone and force responsible officials to act.
Labor Department manipulation increased egregiously in the 1990s. For example, the so-called “birth-death model” estimates net non-reported jobs from new businesses minus losses from others no longer operating.
During expansions, the model works because start-ups exceed shutdowns. It doesn’t in recessions. Yet BLS assumes workers from non-operating companies are still employed. In addition, it adds another 30 – 48,000 jobs monthly whether or not net new companies exist. Assuming they do when they don’t is fraud.
It shows up in monthly BLS reports. They deliberately conceal reality in hard times. Its rarely mentioned U-6 figure tops 15%. It includes “marginally attached workers: people wanting jobs but not actively looking in the past 30 days, but have looked unsuccessfully in the past year.”
It also includes discouraged workers who stopped looking in frustration within, but not exceeding, the past 12 months, as well as others looking for full-time work but forced to take part-time or temp jobs they’d otherwise avoid. Uncounted long-term discouraged workers (those giving up after 366 days) put real unemployment at 22.5%.
America’s deepening housing depression exacerbates today’s jobs crisis. Yet political Washington reports improvement. In fact, conditions are deteriorating, not strengthening. Official data lie. Moreover, promised fixes are fake.
Housing’s extremely important. Homes are the average US household’s largest asset. Economic recovery’s unlikely during a housing downturn. During a depression, it’s impossible. During the greatest housing crisis since the 1930s assures protracted hard times for most people.
Home valuations are declining. Housing starts are low. New home sales are at record lows. Inventories of unsold properties remain high. So are monthly foreclosures increasing them.
A shocking 6.17 million families are underwater or facing foreclosure. Instead of relief, policy measures include open-ended bailouts, unprecedented money printing, zero percent interest rates taxing savers, manufacturing phantom jobs, and doing virtually nothing to create real ones.
As a result, around 25 million Americans are unemployed. Most with jobs have poor ones. Poverty’s at record levels. So is human need. Instead of addressing crisis conditions, Obama lied about the January BLS report, saying:
“The economy is growing stronger and the recovery is speeding up.”
In fact, it’s experiencing the hardest times since the Great Depression with no proposed policy measures to address it. Instead, austerity’s planned when suffering millions need help, starting with decent jobs and living wages.
They’re not around or being created. Just phantom BLS ones, creating an illusion of improvement during harder than ever hard times for growing millions. That’s today’s troubled reality.
A Final Comment
True to form, a February 3 New York Times report hailed the January jobs report headlined, “Job Gains Reflect Hope a Recovery Is Blooming,” saying:
“The front wheels have lifted off the runway. Now, Americans are waiting to see if the economy can truly get aloft.” The January data suggest “the recovery seems finally to be reaching American workers,” despite phantom jobs denying reality.
Saying it, of course, would be spoil-sport. However, it’s not only true, it reveals the grim reality of job losses, not gains.
On February 9, Pew Research published a report titled, “Coming of Age, Slowly, in a Tough Economy,” saying:
Young adults, aged 18 – 24, face harder than ever times finding jobs since WW II. As a result, their lives and futures are affected. Since 2010, only 54% of youths are employed. It’s the lowest figure since data collection began in 1948 and a sharp drop from 62% in 2007.
Moreover, the employment gap between youths and working-age adults is the widest in recorded history at 15%. Since 2007, young adults with full-time jobs saw wages drop 6%. In addition, over 80% of those surveyed believe finding a job today is harder for young people than conditions their parents faced. They also expressed concerns about being ill-prepared for jobs they want for lack of education, training, or other preparation.
As a result, nearly a third went back to school. Another 25% took unpaid work or moved back with parents. One in five delayed marriage plans and child rearing. Whether or not they know it, protracted hard times for years to come will gravely impact their futures.
That’s indeed today’s grim reality. Major media scoundrels suppress it in deceptive reports about improving conditions that don’t exist.
Stephen Lendman lives in Chicago and can be reached at email@example.com.
Also visit his blog site at sjlendman.blogspot.com and listen to cutting-edge discussions with distinguished guests on the Progressive Radio News Hour on the Progressive Radio Network Thursdays at 10AM US Central time and Saturdays and Sundays at noon. All programs are archived for easy listening.