The economy is not on a rebound
In the 10 previous recessions since the Great Depression, prior to this last recession, the economy recovered all jobs lost during the recession after an average of 25 months after the prior jobs peak (when the recession began), according to the records kept by the Federal Reserve Bank of Minneapolis. So the job effects of prior post â€“ Depression â€“ recessions have lasted an average of about 2 years. But under President Obama, by April, 2013, 64 months after the prior jobs peak, almost 5Â½ years, we still have not recovered all of the recessionâ€™s job losses. In April, 2013, there were an estimated 135.474 million American workers employed, still down about 2.6 million jobs from the prior peak of 138.056 million in January, 2008.
Obamaâ€™s so-called recovery included the longest period since the Great Depression with unemployment above 8%, 43 months, from February, 2009, when Obamaâ€™s so-called stimulus costing nearly $1 trillion was passed, until August, 2012. It also included the longest period since the Great Depression with unemployment at 9.0% or above, 30 months, from April, 2009, until September, 2011. In fact, during the entire 65 years from January, 1948 to January, 2013, there were no months with unemployment over 8%, except for 26 months during the bitter 1981 â€“ 1982 recession, which slayed the historic inflation of the 1970s. That is how inconsistent with the prior history of the American economy President Obamaâ€™s extended unemployment has been. That is some fundamental transformation of America.
Moreover, that U3 unemployment rate does not count the millions who have dropped out of the labor force during the recession and President Obamaâ€™s worst recovery since the Great Depression, who are not counted as unemployed because they are not considered in the work force. Even though the employment age population has increased by 12 million since the recession began, only 1 million more Americans are counted as in the labor force. With normal labor force participation rates, that implies another 7.3 million missing U.S. jobs, on top of the 2 Â½ million missing jobs we are still short from when the recession began, for a total of about 10 million missing jobs.
If America enjoyed the same labor force participation rate as in 2008, the unemployment rate in December, 2012 would have been about 11%, compared to the monthly low of 4.4% in December, 2007, under President George Bush and his â€œfailedâ€ economic policies of the past. We will not see 4.4% unemployment again, without another fundamental transformation of Americaâ€™s economic policies.
The number of unemployed in January, 2013, at the end of President Obamaâ€™s first term, was 7.7 million. Another 7.9 million were â€œemployed part time for economic reasons.â€ The Bureau of Labor Statistics (BLS) reports, â€œThese individuals were working part time because their hours had been cut back or because they were unable to find a full-time job.â€
That puts the total army of the unemployed or underemployed at nearly 18 million Americans in January, 2013. They are all counted in the BLS calculation of the U6 unemployment rate, which still totaled 13.9% .
Even Jimmy Carter produced 4 times as much economic growth during his one term as Obama did during his entire first term. In fact, as Anderson notes, real GDP growth under Obama has been the worst of any President in the last 60 years!
You canâ€™t possibly believe the U.S. economy is in a recovery
REO Capital, LLC