Some have heralded the "good news" that the Unemployment rate has dropped from a horrific 9.5% all the way down to 9.4% (tongue planted firmly in cheek). This, according to the Obamanauts, shows us that things are turning around.
Bullshit. All those loveley orange signs heralding the "American Reinvestment and Recovery Act" Projects seem to be posted over strangely silent activities.
In fact, the economy *LOST* an additional 247,000 jobs. So why has the Unemployment rate has dropped?
Two reasons:
1) The Unemployment rate is the percent of Americans who are out of work AND ACTIVELY SEEKING work. After 18 months of recession, many Americans have given up for the time being. They have adjusted to life at home, or life off the books, or a single-income in a formerly two-wage earner home. Accordingly, they are no longer considered in the work force, and no longer counted in the Unemployment figures. So, if there are 100 people in the 'labor force,' and 10 are out of work, that's a 10% Unemployment rate. If 5 of those people out of work give up looking, the Unemployment rate is calculated to be 5 unemployed out of 95 in the labor force, which is only a 5.2% rate. Voila! A lowered rate - even though the same number of people are out of work. Similarly, the homeless - which have grown under the foreclosure spate in the last 18 months - are *NOT* considered "Unemployed" because they are no longer considered in the Labor Force. When they lost their job, they were unemployed. When they lost their home and began life in their cars or on the street, they were magically removed from the Unemployment figures.
2) In order to be counted as "Unemployed," an individual must have *no job at all.* That means that when a middle-aged, middle-level manager making $50,000/year loses his job, he is unemployed. 8 months later, when the bank is threatening foreclosure, and the credit card companies are hounding him with dinnertime phone calls, and the kids' tuition is due, and the electric company is threatening to turn off the lights, he takes *anything* he can get...so he takes a part-time job, 20 hours a week at $8.50/hour, cleaning fast food restaurants after they close at night.
Guess what? According to Unemployment calculations, he is no longer Unemployed! He has a Job, even if its part-time! Voila! The rate goes down.
In other words, the longer the recession, the worse things get, the more desperate people become...the better the rate will look.
And that is what is happening under Obama's "Recovery."
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