The August Jobs Report, Stuck between a Lie and a Hard Place

Posted by PITHOCRATES - September 8th, 2013

Week in Review

The left has been lauding the good economic news jobs report after jobs report.  Always talking about all those new jobs created.  And the falling unemployment rate.  While not talking at all about the falling labor force participation rate.  For good reason.  For while new jobs and a falling unemployment rate are good people leaving the labor force is not.  And, sadly, the only thing making the jobs report look good is that people are simply disappearing from the labor force (see 169K New Jobs Last Month, 7.3% Unemployment: Conflicting Signals For The Fed by Abram Brown posted 9/6/2013 on Forbes).

Unemployment continues to fall, with joblessness reaching a 4-and-a-half-year low in August at 7.3%. Troublingly, the drop in unemployment comes from fewer people looking for jobs rather than a robust economy adding workers to open positions. The number of Americans participating in the labor market is at the lower [sic]point since August 1978.

Going forward, the Fed will need to decide how much stock to put in the unemployment number. It threatens to continue to fall while job creation stays meager–setting up a situation when the Fed could reduce its stimulus at a time when the recovery still isn’t firmly rooted. “People were not supposed to be dropping from the labor force this year,” says FTN Financial’s Chris Low. “While the Fed wrestles with this quandary, we’ll wait to see if it really meant what it said about the quality of improvement in the unemployment rate…At the Fed, there is a tendency to fall back on the unemployment rate as the best gauge of labor market health.” And he warns, “Markets will be unsettled.”

So what is a lying government to do?  After all of those years, and all those jobs reports, trumpeting the success of their economic policies based on the fall in the official unemployment rate, what do they say about the Fed who may raise interest rates because the official unemployment rate says the economy has recovered while the labor force participation rate says it’s still in the toilet?  When the only economic activity has been their friends on Wall Street taking the money the Fed was making and investing it?  Making money with money?  But making no jobs?  That’s something a Democrat administration is not supposed to do.  Helping rich people at the expense of the middle class.  So what is a lying government to do?

Tell the truth and admit that their economic policies have all failed?  To keep that cheap money tap open for their friends on Wall Street?  Or lie?  And say their economic policies have been successful?  And offer no rationale to keep the easy money tap open?  And let them close that tap?  Killing the only economic recovery?  That was enjoyed only by their friends on Wall Street?  Thus exposing the lie that their economic policies created any kind of economic recovery?

Quite the quandary for the Obama administration.


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The August Unemployment Rate falls to 8.1% as the Unemployed Quit Looking for Jobs that just aren’t There

Posted by PITHOCRATES - September 9th, 2012

Week in Review

The August job numbers are out.  And they’re horrible (see Why unemployment rate fell: Fewer people seek jobs by CHRISTOPHER S RUGABER and Christopher S. Rugaber, Associated Press, posted 9/7/2012 on Yahoo! News).

The unemployment rate fell to 8.1 percent from 8.3 percent in July. But that was only because more people gave up looking for jobs. People out of work are counted as unemployed only if they’re looking for a job…

The number of people working or looking for work shrank in August by 368,000, the government said…

Here’s a milestone that’s difficult for President Barack Obama to brag about: There are 133.3 million Americans working — 261,000 short of the number when he was inaugurated in January 2009.

Democrats can talk all they want about new jobs they added each month with their policies but there has been no recovery.  Despite their exuberant cheerleading and the Recovery Summer of 2010 there are still fewer people working today than there were when President Obama began implementing his policies.  And it’s worse if you look at the U-6 unemployment rate.  Which measures people who gave up looking for work as well as those working part time because they can’t find full time work.  The August U-6 unemployment rate is 14.7%.  So the real unemployment rate is 6.6 points higher than the official rate.  Or 81.5% higher.

The Obama administration has tried just about every Keynesian tool in the Keynesian toolbox.  From stimulus spending.  To quantitative easing (i.e., printing money).  And here we are almost 4 years later with a U-6 unemployment rate of 14.7%.  Why?  Because Keynesian economics is just a way to empower government.  It does not create real economic growth.  Like policies that favor the stages of production.  Policies that create a business-friendly environment.  From resource extraction to industrial processing to manufacturing to consumer sales.

The Keynesians only focus on the last stage.  And leave in place policies that hurt the upper stages.  Which explains why their policies don’t create real economic growth.  While those who do focus on these upper stages of production have strong economic growth.  Like JFK.  And Ronald Reagan.  A couple of tax-cutters that created a business-friendly environment.  That generated the kind of economic activity that no Keynesian has ever matched.


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Black Wednesday and the Killing Season sound like Action Adventure Titles but it’s just August in the NHS

Posted by PITHOCRATES - August 11th, 2012

Week in Review

If you’re traveling in Britain in the first week of August don’t get sick.  Unless you feel lucky (see Thousands of juniors start jobs in NHS ‘killing season’ by Rebecca Smith posted 8/1/2012 on The Telegraph).

Around 7,000 graduates begin their first job as a doctor today and thousands more change to new jobs as their training continues.

The changeover has been labelled as ‘black Wednesday’ or the ‘killing season’ because of the rise in deaths.

Studies have shown that patients admitted as an emergency on the first Wednesday in August are six per cent more likely to die than on the previous Wednesday.

Black Wednesday?  Killing Season?  Egad these are two labels you don’t want to hear describing the hospital they’re rushing you to so they can save your life.  The NHS should really do something about this.  It’s not befitting a national health care system they celebrate in the opening ceremonies of the Olympic Games.  And the NHS, being the fine national health care system it is, is fixing this problem.

It was announced earlier this year that junior doctors will shadow a more senior colleague for four days in an attempt to reduce the number of mistakes made and ensure patients are kept safe…

Trials in Bristol reduced mistakes by junior doctors by 50 per cent over their first four months.

There’s a fine line between being a highly skilled doctor in the NHS capable of taking on any health care emergency.  And being a junior doctor with capable skills that may only kill 6% of his or her patients.  That line in the NHS is after day 4.  After which their kill percentage goes down to an acceptable 3%.

There is a reason this is happening.  And it’s not because the medical schools are bad.  It’s not because these senior doctors do a poor job in teaching the new doctors.  And it’s not because the junior doctors are bad.  The reason is economic.  A declining birth rate created an aging population.  That aging population is now hitting Britain’s pension system.  And the NHS.  Increasing spending at a time when there are fewer people entering the workforce to pay the taxes to fund the NHS and those pensions.  Budgets are straining.  Deficits are growing.  So what do you do when the number of patients is growing greater than the ability to pay for them?  You make doctors and nurses cover more patients.  Forcing these junior doctors to ‘grow up’ fast on the job.  To act as if they have years of experience during their first days on the job.

Surveys have shown that junior doctors are asked to carry out operations and procedures on patients which are beyond their capabilities and often have responsibility for large numbers of hospitals patients overnight when fewer senior staff are on duty.

Dr Anthea Martin, senior medical adviser at the Medical and Dental Defence Union of Scotland, which provides legal advice for doctors and dentists nationwide, said junior doctors should not be asked to carry out tasks they are not confident doing and should always seek help from senrio [sic] colleagues if tehy [sic] are unsure.

The sad thing is that it will only get worse.  Until the baby boomers die out so that they have more taxpayers entering the workforce than leaving it.

Announcing the new shadowing scheme, Professor Sir Bruce Keogh, NHS Medical Director, said…“Patient safety and providing a high quality service is at the heart of a modern NHS. This shadowing period could potentially save lives, and will equip new junior doctors with the local knowledge and skills needed to provide safe, high quality patient care, from their first day as a doctor…”

“It means new doctors will be ready to go on the first day, familiar with the hospital’s systems and ready to focus on patient care rather than worrying about where to find the X-ray request forms.

“It will go some way to making sure that patients get good care whatever day of the year they present and we’re pleased this is now in place nation-wide.”

Yes, let’s teach these new doctors the important things. Have these senior doctors show these junior doctors where the X-ray request forms are.  Once they get the proper bureaucratic procedures under their belt then they can treat their patients.  Knowing that when they request some test or procedure that they will use the correct form.  Reducing lost time from not making these life-threatening mistakes.  So the hospital can input patients and process them quickly.  In an assembly line procession.  One after the other. Quickly.  And efficiently.  No time to dither around with that talking nonsense.  Patient arrives at one workstation.  The worker reads the form.  Performs the work.  And sends the patient to the next workstation.  High productivity is the only answer to the problems at the NHS.  As it will be with Obamacare.  Because the Americans, too, have an aging population.

Currently the U.S. doesn’t have a Black Wednesday.  Or a Killing Season.  But you know it’s coming.  Because there is no way that Obamacare will be better than the NHS.  Not when they will be starting with an aging population that will only age more.  And they will have 5 times the patients the NHS has.  Not to mention the fact that the NHS has been doing national health care for awhile.  So on top of everything else the Americans will also have the learning curve working against them.  Which could cause a British patient being rushed to hospital on a Wednesday during the Killing Season to say with typical British fortitude, “Could be worse.  I could be in America.”


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