Jobless rate looks nice — until you look under hood
STEVE HUNTLEY email@example.com October 5, 2012 11:48PM
Vice President Joe Biden | AP file
Updated: November 8, 2012 11:59AM
The debate saga of Campaign 2012 moves to the vice presidential level Thursday as Democrat Joe Biden takes on Republican Paul Ryan with the twin goals of altering the narrative of debate failure by President Barack Obama and touting the September decline in the unemployment rate as proof that the administration’s policies are working. Tough challenges both.
Such was the debacle of Obama’s showing in the Denver debate against GOP presidential nominee Mitt Romney that Democrats have resorted to denial and attack.
Denial has taken the form of all manner of excuses for Obama, perhaps most notably blaming moderator Jim Lehrer of Public Broadcasting for somehow mishandling his job in a way that harmed the president’s performance. Nonsense. Lehrer did his job admirably in a format — agreed to by both sides — that emphasized free-wheeling exchanges between the two candidates and that kept to a minimum interference from the moderator.
Attack has come in the form of nasty Obama advertising accusing Romney of lying during the debate. That’s an ugly way to characterize partisan differences. A key line of attack was to double-down on the charge that Romney has proposed a $5 trillion tax cut.
It was more than a little amusing to watch when CNN’s Erin Burnett confronted Obama spokeswoman Stephanie Cutter with facts showing the allegation is false. “Well, OK, stipulated, it won’t be near $5 trillion,” grudgingly admitted Cutter, who has been caught on the wrong side of the truth before.
Democrats seized on the Labor Department’s report Friday that the unemployment rate in September fell to 7.8 percent, dropping below 8 percent for the first time in 44 months. So surprising was the decline that it set off speculation among some conservatives about a cooked-booked October surprise.
That’s not remotely likely as playing with the numbers to influence the election would surely come out eventually and plunge the nation in a crisis the likes of which we haven’t seen since Watergate.
A more likely possibility advanced by several economists was that the September number was a statistical quirk. If so, we should find out when the October jobless number comes out days before the election.
For all the hoopla Biden may make out of the September figure, a closer look finds the Obama economy is still miserable. The jobless rate fell because employment increased by 873,000 last month. But a whopping two-thirds of those jobs — 582,000 — were part time.
As the Bureau of Labor Statistics put it, “These individuals were working part time because their hours had been cut back or because they were unable to find a full-time job.”
Do Biden and Obama want to campaign on four more years of that?
What’s more, a 7.8 percent jobless rate is more than 2 percentage points above the 5.6 percent rate the administration predicted for this month when it promoted its $830 billion stimulus in 2009.
Some other indicators support the idea that September was a fluke. The nation’s economic growth rate has been falling for a couple of years, hitting 1.3 percent in the second quarter. Consumer spending fell in September, reports Gallup.
A survey by the U.S. Chamber of Commerce found 60 percent of small-business owners and executives say the business climate has deteriorated over the last two years, and only 17 percent expect to hire more workers next year, a number that’s been trending down this year.
And 76 percent say the costs and regulations of ObamaCare make it harder to hire more workers.
Obama and Biden may tout a nice-looking September jobless rate, but looking under the hood shows that, as James Pethokoukis of the American Enterprise Institute put it, “The U.S. labor market remains in deep depression with virtually no recovery since the official end of the Great Recession.”