Are we finally there:
In the strongest employment report since the recession began nearly two years ago, the government said Friday that the nation’s employers had all but stopped shedding jobs in November, taking some of the pressure off of President Obama to come up with a wide-ranging jobs creation program.
The Labor Department reported that the United States economy lost 11,000 jobs in November, and the unemployment rate fell to 10 percent, down from 10.2 percent in October.
The government also significantly revised its September and October job loss estimates. September’s data was adjusted to show a loss of 139,000 jobs instead of 219,000, and in October 111,000 jobs were lost, instead of 190,000. Even allowing for the November loss, the revisions added 148,000 people to the list of those employed in the United States in November.
Though the pace of job loss has been declining since a peak in January, the November number was surprising. Economists had been expecting a turning point to come in the late spring or summer, with employers finally adding workers as a recovery takes hold. The last time the number was so bright was in December 2007, when the economy added 120,000 jobs.
Only losing 11k jobs is hardly something to cheer about, but considering the past year, it at least warrants a sigh of relief that the end might be near.
Redshirt
How will Repugs spin this as bad news?
cleek
wake me when we start to regain jobs (including one for me).
JenJen
While I greet this as really great news, I do have to report that it doesn’t feel great here in Ohio, and certainly not in Michigan. We’re still dying out here, the job market is actually tightening, and I’d really like to see some targeted relief for the states most affected by this recession. Extending unemployment benefits was an excellent decision which I applaud, by the way, and isn’t it interesting that you don’t really hear a lot of wingnuts grousing about that level of new federal spending?
As an aside, yesterday I made the mistake of watching “Morning Joe” and of course, they had uber-idiot Maria Bartiromo on. How is this woman employed? Right after a very somber Governor Granholm (Michigan) was on the program, Maria was insisting that the loss of the US manufacturing base is something rather new in this country, and that people are just now realizing that maybe those jobs aren’t coming back. I can only guess she didn’t listen to a lot of Bruce Springsteen or Billy Joel in the 80’s?
Sentient Puddle
@Redshirt: I’ll check Megan McArdle’s commenters. That should provide a good sample.
NickM
When I saw that title, “The Bottom,” I thought it was a post about Palin’s endorsement of Birtherism. I see that’s addressed in the post below, though.
Noonan
@Redshirt: Didn’t get enough bang for our (tax-break, tarp) buck.
Just Me
It’s still time for a strong jobs-creation program (if not “wide-ranging”).
That number doesn’t take into consideration the people whose benefits have run out and the people who have given up, nor as far as I know, does it consider the underemployed (part-timers who’d prefer to be full). I know entirely too many people who fall into these categories.
We have stuff that needs doing in this country. We have people who want to do stuff.
I guess this attitude makes me a DFH. Or something.
AnotherBruce
I think we should wait a couple of months before claiming that we’ve hit bottom. We’ve been bleeding good paying manufacturing jobs for a long time and we stubbornly refuse to have any sort of industrial policy that would attempt to bring these jobs back.
Ultimately we may have some sort of recovery, but with lower paying jobs and higher unemployment rates as we continue to chase cheap labor all over the world so we can win the race to the bottom.
Ailuridae
@Just Me:
The U-3 number (“10 percent”) doesn’t take into account all of those things but the U-6 does take some of them into consideration and its showing a similar trend. I’ll see if I can dig up a graph.
mk3872
This economy has not added jobs since 2007.
When Obama took over, we were losing 600k jobs a MONTH!
And the EVERYONE (media, pundits, GOP, Dems, supporters) are nailing him to a cross for not immediately adding jobs?
Are you kidding me??
We just saw positive GDP growth 2 months ago for the first time in over a year!
andy
It’s probably due to seasonal hires- I suspect it’ll go back up a bit in January after the sales are over. A lot of businesses like to do their firing around the holidays, too, when their fiscal years end- though if you’ve been in the private sector long enough, you’ll have noticed that sociopaths tend to end up in HR slots too…
scav
and it assumes that there will be no more shocks to the system. yeah, tell me again that CRE is currently troublefree. granted, I’m one of Nov’s statistic, but I know my lots planning a more significant hack job for March. I’m in a serious wait and see mode.
New Yorker
Then there’s me (and a lot of my classmates). I went to grad school and graduated into this mess, and the government doesn’t do a thing to help me since I wasn’t actually laid off. The best they can do is allow me to delay paying back my student loans (of course, what I really want is to tell Uncle Sam is that he can have my $28,000 in loans back when AIG pays back its $170 billion in “loans”).
I’m technically not unemployed since I’ve been hired to be a test prep teacher by the WaPo’s corporate overlords, but it’s only part-time work and it has yet to begin.
Derelict
Not to wiz on the campfire, but I have to wonder how many of the jobs created and/or not lost are due to seasonal effects.
The company I’m now working part-time for (it used to be a full-time job) has hired (actually re-hired) 6 pilots and a few mechanics. It has already been announced that everyone those rehires will be going back on unemployment come Jan. 1. My own continued existence is in question–nobody knows if we’ll have enough business and budget left to employ me even on a part-time basis.
So, yeah–good news for the economy
for now.
pcbedamned
@Sentient Puddle:
Hot Air is really on a roll as well…
geg6
@JenJen:
Yup. She’s apparently never been to or even heard of Pittsburgh. Because that was the back story to the whole choice of the city for the G20. This woman is the biggest idiot. I’ve never heard her say an intelligent thing about the markets or the economy. I can run circles around her on those subjects and I have no background whatsoever in finance and only the undergrad poli-sci requirements in econ.
The big caution for me is that I read somewhere the other day (Matt Y, maybe) that these numbers were seasonally adjusted, which apparently makes them look better than they really are. But, as I said, IANAE.
On a lighter and OT note, here’s some BOB bait where the Rude Pundit does a delightful review of the Glenn Beck theatrical extravanganza, The Christmas Sweater II: Even More Maudlin and Weepier:
http://rudepundit.blogspot.com/
EconWatcher
WSJ had an article last week that 1/4 of home mortgages are under water. Massive amounts of hidden home inventory is being held by banks, and will further depress housing prices when finally released onto the market. We haven’t yet reached bottom in the commercial real estate market. And the current positive blips are just the result of massive and unsustainable pump-priming, which was the right thing to do, but has not solved the underlying problems.
This is just the eye of the storm.
gbear
@Just Me:
Only if the ‘stuff’ that needs doing is like, you know, drugs.
Amy
I thought the unemployment rate is seasonally adjusted. And in any case, these are November job numbers, which is not at the peak seasonal hiring time.
The Moar You Know
It’s not the bottom. It’s the new normal, and things will remain this way until we take a fundamentally different attitude towards how we deal with taxation, workers, business, and labor relations in this country.
Llelldorin
@Derelict:
Government unemployment figures are “seasonally adjusted” to try to smooth out those effects, if I remember correctly.
Mr. Poppinfresh
John, these numbers are bullshit- they don’t take into account the fact that 3.86 million people are on emergency unemployment compensation, because their 6-month UI ran out. They also don’t include the people who have been taken off even the EUC, which is estimated to be anywhere from 500k-1m more people. Basically somewhere in the neighborhood of four and a half million jobless people aren’t being counted in the seasonally adjusted numbers, which pushes the whole thing to over nine million people.
It’s still a shit-show out there.
comrade scott's agenda of rage
I good friend of mine has turned into a Democrat because of all the aid he’s gotten during his one year of being unemployed. He now sees the value of a social safety net: he didn’t lose his house.
Okay, he’s still unemployed (45 years old with an “associates” degree doesn’t get you far) so our group’s best Economic Indicator is when he finally gets a job, the economy will be on the mend.
Of course, any likely job in this region will pay 20-30% than his last job and it didn’t pay great.
Sentient Puddle
@Sentient Puddle: Here be the results of my search. I’d like to point out that I picked McArdle’s comments section over, say, Hot Air because these are supposedly the idiots who know a thing or two about economics. Or at the very least, these are the idiots the media will turn to for analysis. And away we go!
OK, so they kick things off with something that actually sounds plausible. Granted, we still can’t verify this until the months ahead, but if this is how the comments are going to go, this doesn’t bode well for my nutpicking attempt. Blast it all to hell!
Oh, well guess we can’t give credit to Obama when things go right. We can only blame him when things go wrong!
Anyone want to fact check that “always” against November of last year? Or maybe 2001? I’ve got a feeling…
Ah, so that’s why unemployment went down…the illegals are stealing our jobs!
Hey Obama, unemployment numbers for the rest of the year? ur doin it wrong
Because a sense of scope is totally irrelevant.
So Bush and the Republicans, presiding over the jobless recovery of the 2001 recession, were Keynesians? Huh.
All in all, sounds like you can expect a lot of bullshit from the Republicans. But that talking point about retail jobs might stick just because we can’t really disprove it.
zzyzx
Why are people so allergic to potentially good – or at least less bad – news? Every story about this I’ve read has had a comments section with people trying to debunk it. Maybe there is a flaw or we’re heading to a double dip, but maybe – just maybe – after 18 months or solid job losses things might be starting to turn around.
donovong
Fukitall. This is good news. Hell, this is great news. The trend is undeniable, and things are getting better, dammit.
Now, don’t go harshing my mellow.
Ailuridae
@Llelldorin:
This.
Also, U-6 (the measure of unemployment I mentioned upthread) fell from 17.5 to 17.2. From everything I have seem they move more or less linearly so .2/10 ~.3/17. I can’t find the link I stole this blurb from but here is a reasonably succint explanation of U-6:
The U-6 figure includes everyone in the official rate plus “marginally attached workers” — those who are neither working nor looking for work, but say they want a job and have looked for work recently; and people who are employed part-time for economic reasons, meaning they want full-time work but took a part-time schedule instead because that’s all they could find.
Also, when you here the unemployment figures from the Great Depression those are most analagous to U-6 and not the more common U-3. At some point it would have behooved the Democrats during the ARRA debate to mention that we were already more than halfway to Great Depression levels and losing jobs rapidly. Maybe that 40 or 50B that NelsonCollinsSnowe cut out of state funding would be there and there would be a whole lot less unemployed folks.
Jasper
The figures are seasonally adjusted. Just as an example, the actual retail jobs added last month were about 322,000, but the seasonally adjusted number says we lost 14,000 retail jobs. And in January, those layoffs will similarly show up in the non-adjusted column but won’t show up as a spike in the number or rate of unemployed per the official releases.
U-6, the broader measure, dropped from 17.5% to 17.2%.
Nylund
Taking pressure of Obama to create jobs is bad news. We still have a really high unemployment rate and a large amount of people that have removed themselves from the labor market altogether.
These numbers are good news, but we still need much much better news, and that will require strong and decisive action, and that action will only come when the president is feeling the pressure to do something.
So, celebrate the good news, but keep the pressure high.
Fern
@andy: The unemployment rates are not seasonally adjusted?
comrade scott's agenda of rage
@The Moar You Know:
Which will happen precisely when Dubya or Cheney ever accept responsibility for fucking so many things up during their 8 years of misrule, or pigs fly (out my ass even), or Sarah Palin discovers some intelligence, or, ah, you get the point.
But yeah, it’s the new normal. Hope everyone who bought into the 401K bullshit now see the folly of counting on that to fund your retirement. Mine’s a 101K now.
Sentient Puddle
A ha, I didn’t realize figures were seasonally adjusted. So there goes that potential talking point out the window too.
So…I have no idea how the Republicans are going to try and spin this one now. It doesn’t seem like there’s any bad news they can grasp on to.
Ryan Cunningham
I’m suspect there will be another round of layoffs in January-February after a disappointing holiday shopping season. I don’t want to be right about this.
JenJen
President Obama is on TV, and just said, in the context of deficit reduction when the economic conditions ease, “I didn’t run for President to sweep our messes under the rug with the next election in mind. I ran for President to solve our problems once and for all, with the next generation in mind.”
Nice broadside on the last 30 years, if you ask me.
Ailuridae
@zzyzx:
Because it means that public sector involvement in massively slowed economies with high unemployment is an effective remedy. Of course, this is plainly, unquestionably true. The worst part of American exceptionalism isn’t the foreign policy but the fact that our mainstream press and a majority of our populace thinks in economic terms largely similar to the Cato Institute. In the rest of the world (economic) libertarianism is pretty much wholly discredited; here its the overwhelming narrative of the realities of economics and finance.
AnotherBruce
Why are people so allergic to potentially good – or at least less bad – news?
I admit it makes me cautiously happy. But there has been long term damage done to our economy because of our long term policy of turning our economy into a Wall St. casino. These were lessons that were supposed to have been learned in the 30s and 50 years later we forgot almost every one of them. I say almost because at least FDIC insurance prevented a run on the banks.
cyntax
Calculatedrisk has an interesting graph up. If this is the bottom, it looks like it could take 24 months or more to recover the job losses from this recession.
Jon H
@Redshirt: “How will Repugs spin this as bad news?”
They’ll claim the Obama administration doctored the numbers.
Or, and more reasonably, they’d note that we need ~150,000 new jobs per month just to keep up with population growth, so an 11,000 job loss is more like 161,000.
pcbedamned
@Sentient Puddle:
Yes true, but if you wanna know what the ‘Real Americans‘ think, Hot Air gives you a pretty good idea ;)
Sentient Puddle
@cyntax: 24 months or more only if you compare it to the 2001 recession, which itself was pretty abnormal as far as recessions go. As you can see, with most of the other recessions, employment recovered pretty rapidly after bottoming out. Everyone was sort of expecting that too with the 2001 recession…but it didn’t really happen, which is why it was known as a jobless recovery.
As for whether or not this recession will follow that trend, I sure as hell hope not, but I’m in no way qualified to make that prediction.
Kirk Spencer
It might be the bottom. I think it is – I’m the guy we’d done so, and that we’d start seeing job losses stop sometime in the first quarter of 2010. BUT…
The bottom is not the end. It could be the beginning of a doldrums; a time of very slow to flat gdp growth accompanied by little to no decline in unemployment.
My guess as I’ve said before is that we’ll see an actual recovery start in spring of next year. It’ll be driven by three things: the stimulus effects that weren’t scheduled to kick in till 2010; the stimulative effects of the health care bill (which I expect to pass); and Son of Stimulus – The Jobs.
Two personal notes – tracking, and personal bias.
Tracking – I’m not giving U3(SA) high trust. U6(SA) and U6(NSA) between them are (in my opinion) a bit more trustworthy. However, I’m also keeping an eye on the “not in the labor force” proportion. That’s been in pretty much constant decline since 20001 but has been a lot steeper for the last couple of years. It’s not just the retirees and the adults supported by others in the household, it’s the people who have just given up so much they’re not even on the U6 line. I think that due to the steepness of the preceding year’s decline we’ve got a great test for “yes, we’re recovering” as opposed to being in doldrums by watching for that number to improve.
Personal – it’s a recession when the other guy loses his job, it’s a depression when you lose yours. I’ve been in a depression for almost a year and a half now. Not gonna go in depth here, just noting I’m not one carrying the bias of “got mine so it’s gonna get better”.
gwangung
@cyntax: I think it’s moderately good news that we can think of recoveries.
Michael D.
@Redshirt:
It IS bad news. For Republicans (John McCain excepted, of course)
bago
Hey John, questions end with a question mark, not a colon.
Back atcha.
Phoenix Woman
@Ailuridae:
Exactly.
Butch
I see that Nylund beat me to the punch; I don’t know that “taking the pressure off” is a good thing or that we should be looking at returning to a “normal” that might not have ever existed. Per Dave Johnson at the Campaign for America’s Future (it’s linked on the second page over at Kos):
The idea that you can get the financial sector and the economy back to “normal” desperately assumes that a sustainable “normal” existed in the structure of the 20th-century western economy. It assumes that there really is an “invisible hand” that takes care of things without human intervention. It assumes that perpetual growth of consumers and their incomes and of consumables could just go on and on.
This all assumes that “normal” was OK. This is such a nice, comforting idea. It is wrong.
[…]
You might be lucky enough to still have a job today but you probably haven’t had a raise for a long time. And if you did rising costs of health care, etc. took it back. But even if you are ahead, what about tomorrow? Do you have a job that absolutely can’t be outsourced or replaced by technology? If you think so I have news for you, millions of newly-unemployed can see that you have a rare necessary job, and they’re all going to try to get it from you.
gex
Of course, we need to actually be creating jobs to keep up with population growth.
Seeing as it is necessary to remember that unemployment figures are rigged (only during Democratic administrations of course) the Republicans will happily point both of these facts out in order to say that the conditions are still really, really bad. Probably because we spent money on infrastructure projects and gave money to states instead of dedicating the entire surplus to tax cuts.
Because of the memory hole, these caveats to job numbers will continue to only apply during Democratic administrations.
Michael D.
@cleek:
I can agree with this because I am experiencing it as well. I am fortunate to have a very good job at a company that has added about 10,000 jobs this year, so I was never worried about my job. I’m lucky, because it also pays well.
On the other hand, my partner has been out of work for over a year now. He is a Landscape Architect, and if you do a search for LA jobs in the US, you will find approximately zero. So we’re at a point where my salary pays my mortgage, both cars, groceries, bills, insurance for both cars, and his medical – which I am taxed on because I am gay.
And, since he hasn’t received his green card yet, he can’t even go out and get a job at Starbucks in the interim.
This recession has hit a LOT of people in a LOT of different ways.
Maude
Obama and congress are talking about using the rest of the TARP money for a jobs bill. The weenies are already howling.
El Cid
Well, the answer depends on whether or not I’m being introspective and thinking things through for myself, or simply taunting available Republicans for the fun of it.
Xanthippas
Now, on to getting some of those jobs back…
Morbo
The bad news is that it won’t be spun as bad news. The logic that is gong to be applied is pretty simple. If we’re no longer losing jobs, then we won’t need another stimulus or jobs bill and it’s time to start turning our attention to the deficit. This “good” news is going to lull our wonderful legislature into complacency. I mean, further into complacency. And with that, double dip here we come. Hopefully I’m wrong about the last part, but the WaPo articles screaming about the deficit are about to double in number.
gex
@EconWatcher: And there has still been very little attention paid to CRE from my vantage point. In ’08 when things really hit the fan, it seemed odd to have so much commercial construction in my suburb of MSP. And of course it was. Within 2 miles of my house there are 3 or 4 new business complexes that have not leased out a single space.
I don’t know much about this crap, but it seems to me that this is a potential shock to the system much like the mortgage bubble burst.
kay
I’m an optimist, so I’m cheering.
I don’t know if it’s true for other people, but this whole dreadful experience has changed how I think about a lot of things. I’ve adopted a sort of adversarial posture to the finance industry, and I think that’s healthy.
I will never, ever forget that finance, as an industry and a sector, brought about the worst crisis since the Depression and then did not one thing to mitigate or help in recovery. Not one thing. Not an idea, not an offer, not nothing. I was shocked initially, but I’m no longer naive, and I won’t make that mistake again.
Their response to all the havoc they caused they was to pour millions into lobbying against oversight, and work like hell to secure their own bonuses, and that’s all they did.
That’s an adversary, and we should all be clear on that, going forward.
bago
There IS an invisible hand, it’s just that the hand is prone to bitch-slaps.
The Republic of Stupidity
@Kirk Spencer:
What? The first quarter… of an ELECTION year?
Clearly, this is Political Chicanery of the Highest Order™!
Start the investigation!
El Cid
Now this means everything’s fixed on jobs and the economy and now we need to get onto cutting Social Security and Medicare so that we can make people who claim to care about ‘the deficit’ happy, since that’s the reason we and our government exist.
gex
@zzyzx: After 8 years of just assuming everything will go exactly as we plan and having no backup plans to address any issues is why.
It is naive to just throw confetti without asking ourselves what this means exactly. Viewing politics and policy with a critical eye is necessary, I think.
cyntax
@Sentient Puddle:
I don’t know. It might be a little less than 24 months, but even then, it could be pretty close. Look at 1978 for example, it bottomed at 13mo and recovered at 22mo; 1980 bottomed at 4mo and recovered at 10mo; 1981 bottomed at 16.5mo and recovered at 27mo.
Another thing to consider is that usually real estate leads us out of a recession but that’s going to be really hard with this one.
The Republic of Stupidity
@bago:
Indeed… indeed… after which it starts patting you down in search of your wallet.
Kirk Spencer
@The Republic of Stupidity: heh.
I’ve got a bet with some acquaintances who still drink some of the koolaid – they’re sucker bets.
I expect jobs bill will be on the floor of either House or Senate by the end of January and that by the same date the Republicans will have voted pretty much on party lines to block it: introduction vote, cloture vote, votes to have it returned to committee, and final vote. They won’t take my bet on that, they agree; so that’s not my bet.
No, my bet happens when we start seeing the inevitable ad campaigns about “Your congresscritter voted against you getting a job. Maybe he should be looking for one too? Vote for [opponent].”
The bet is that the Republicans will then complain about Democrats forcing such a partisan political issue into an election year. In other words, they’ll blame the Democrats for putting them in that bad position.
cyntax
@gwangung:
Agreed. But also don’t want to count chickens yet, what with all the talk of double dips. It’ll be interesting to see what happens in the spring when the homebuyer tax credit runs out and a lot of the ARM loans reset from interest only to interest+principle.
Sentient Puddle
@Butch:
I don’t think I subscribe to this way of thinking. A bit ago, I had written up a longer reply to this, but realized that it was too long and probably too wonky (which for me means I’m probably talking about things I know nothing about), but the short of it is, I think it’s way too easy to fall into this way of thinking when we’re deep in a recession. Conversely, it was way too easy in the late 90s for us to think that the good times would last.
Obviously we need to rethink a good bit of our economic policy, but I don’t see any reason to think that “normal” as we knew it before is completely gone.
The Republic of Stupidity
@Kirk Spencer:
Ya mean, like w/ the Franken Rape Amendment?
‘How dare you make us look like we’re in favor of rape!’
If the Republicans didn’t have their ‘victimhood’ to whine about…
dlw
How about spending billions of dollars of stimulus money to totally rebuild our internet infrastructure by putting in a nationwide fiber optic, to the front door, network.
It could employ a ton of people and when it was done, we’d have an awesome platform for building on the future in America.
lutton
According to Atrios & Calculated Risk, we need to add 140k jobs on a monthly basis to keep up with population growth. Anything less than that is a net negative.
Sentient Puddle
@cyntax: Yeah, you’re pointing out the reasons why I don’t want to make any solid predictions on this one…this recession is deeper than any since the Great Depression. I don’t know if any of those other recessions make for a good comparison. 2001 may very well be the one to compare it to. And yes, housing…yech, even worse…
I’m still broadly optimistic, mostly because I think Obama is doing about as well as he can in managing this recession. But I could be completely off in my assessment.
Cat Lady
@gex:
You betcha’. Keep your eye on CRE. The bombs are going off in that sector big time, as we speak. The big Wall Street banks went really big into securitizing all those CRE mortgages (CMBS), underwritten with crazy terms like 10 year interest only, 30 year amorts with default triggers that have surely all been triggered now since LTV ratios have fallen. The banks who hold CRE portfolios have not dealt honestly with this yet, and it’s not just the landlords, it’s all the construction loans and suppliers of construction products with lines of credit. That whole sector has been torpedoed below the water line, and is just now beginning to list. Read Jim Kunstler’s analysis on how the collapse of the suburban/exurban big box store economy will play out. I’m not comfortable saying we’re at the bottom of anything.
slippy
@Sentient Puddle: Frankly, I think a lot of people are still waiting for employment to recover after the 2001 recession, and in my opinion we’ve been in the 2001 recession ever since it started.
Because, as far as I can tell, nothing ever fucking improved after Bush took over. I didn’t lose ground economically during the last 9 years, but I didn’t gain anything either. I was lucky enough to be in a sector of the economy (healthcare) that doesn’t deal much with demand since people are sick are sick are sick are sick and you can’t do much about it.
However, I have noticed that my health insurance premiums have risen by 600% since 2000, my coverage has decreased by 80% on paper, more like 50% in reality since the insurance company denies almost every claim, and my real cost of covering healthcare for a family of four went from ~$100 monthly at the end of the century to ~$5000 yearly as of last year, or more sometimes depending on how unlucky we were. I also watched gas prices grow from $1.50 to $4.00 in that period, house prices increase by 70%, and my energy bill soar to upwards of $400 depending on how greedy the gas company thought they could get away with being. Also I watched my roads deteriorate, the value of my dollar shrink like a cotton shirt being washed too many times, and of course the difference between where I was and where I could be if just one tiny thing went wrong became a mountainous precipice that kept me awake at night with fear.
Of course, we can all buy $199 LCD TV’s at Wal-Mart now, so I shouldn’t complain.
In my opinion, Bush took a hold of the US workingman’s head, erupted a gigantic shit into our faces, and told us it was chocolate fudge. There is no one I despise more than Bush. Literally. He has fucked up more of America than a hundred Osama bin Ladens could ever manage.
cyntax
One thing I’ve been considering lately is the degree to which “normal” for the last 30 years has been predicated on flat wages that were offset by increasing household debt, debt that was necessary to keep up with the rising costs of housing, medical, and food needs. From that perspective, there is a way in which “normal” isn’t sustainable.
The debt bubble that the middle class had to ride to survive certainly benefitted some parts of our society though.
Elie
@JenJen:
Believe me I am not supporting Bartiromo, but many Americans still have not started to think about the reality that many jobs are never coming back…
Some of the anger out there is due to that emerging reality. I hope it doesnt get too much worse (the anger, resentment), but it could and who knows who the target/s will be for it?
There is plenty of blame to go around from globalization to poor economic policies and an ineffective educational system that prepares people for a variety of jobs. Won’t necessarily matter though…its been years and years in the making as you commented…
The Republic of Stupidity
@Sentient Puddle:
I’d like to think there is a way to get back to that – ‘normal’ – at least somewhat. The question, to me is: do we have the political willpower to do what we prolly have to do to accomplish this, and that would involve reining in the big banks and Wall St, prolly doing something about executive compensation, really brass knuckling the healthcare companies, dealing w/ the military-industrial complex…
Heh… nice wish list…
Dear Santa…
The Moar You Know
@comrade scott’s agenda of rage: I could blame Bush and Cheney; and Bush Sr. And Bill Clinton. And Ronald McReagan.
But I don’t blame ANY of those individuals. They are tools in the hands of interests.
I blame a financial system that is designed to screw the working man out of as much money as possible, a legal system that is designed to keep the average Joe from any real redress from crimes committed against him by either said legal system or previously referred to financial system, a political system in which the two parties are indistinguishable save for their positions on some relatively unimportant fringe issues (that’s how we ended up with the financial and legal system we have), a media that routinely endorses rank stupidity and not only dismisses, but actively mocks intelligent thought, and, of course, most of all I blame voters that are willfully and actively ignorant, prejudiced, and self-defeating.
Sorry about your 401k. Happened to a lot of folks I know. I do not think anyone who is not independently wealthy will be retiring anytime soon.
TaosJohn
Hee-hee…
This needs no comment.
But I did see several references to “retirement” above. That needs no comment, either, but I’m stupid, so: retirement is a marketing concept. We are at the very beginning of an entirely new way of life, and virtually none of the previous expectations apply.
There. Bye now.
Cat
I’m not sure why everyone things the millions of jobs created during the housing bubble will come back. Its very likely the huge influx of money from abroad that was flooded into our economy in the form of HELOCS, cash out refis, and liar loans caused most of the growth in our economy for the last few years and we are just returning to the baseline.
I’ve was IT field well before the Internet Bubble and saw the same thing. The influx of workers into the field who all then promptly left never to return and all the went out of business and were never replaced is just a feature of bubbles.
You know your economy is in bad shape when the illegal workers are returning home for better job prospects and their families are sending them money.
The Republic of Stupidity
@Cat:
Heh… at least it’s flowing BACK INTO the country…
Makewi
I’d be cautiously optimistic, because hiring usually goes up around the holidays. If the trend continues into January and February then the corner has probably be turned.
cyntax
@Cat:
And since most of our current fiscal policy is working as a prevent-defense against price disclosure in the real estate market, we’re not going to get to baseline very quickly.
Cat
@cyntax:
As someone who escaped the lower class to the upper middle class I feel the middle class deserves to share in some of the blame for the situation they are in.
My wife broke me of a lot of my bad habits, but the existence of Starbucks and $10 a meal fast food restaurants is ample proof a lot of the middle class hasn’t. I’m sorry if bring a thermos of tasty beverage from home and packing a lunch at a 80% savings some how diminishes your feeling of ‘middle classness’, but the working poor aren’t even getting to eat three meals a day every day.
The middle class’s desire to pretend they are the upper class or please the upper class in hopes of being allowed in has caused them them to turn their backs on the institutions and ideas that were instrumental in establishing the strong middle class we used to enjoy.
Elie
@Cat:
You got that absolutely right on. The death of the union movement was a huge part of this… The critical question for progressives is how we raise awareness in folks once more and include raising that awareness as part of our grass roots strategy. Too much of the time I feel that we are top down in our approach to change and leadership and that wont work here.
JenJen
@Elie: Is it maybe a regional thing? If you’re a native New Yorker who stayed in New York, do you really get the fact that the rust belt’s manufacturing base vanished a few decades ago now? I’m willing to give her a pass on the New Yorker thing, but since she’s a reporter and media figure and supposed expert, that’s where I pile on.
I do think a lot of people are just now beginning to see the effect on their own lives, but in Ohio and Michigan and Pennsylvania this is not the breaking news that Bartiromo seems to think it is. It’s been depressed here for decades, and everybody’s been pissed off for a long time. The parents of my friends in my hometown of Dayton used to have really good jobs at Frigidaire, Delco, GM and NCR. But it hasn’t been that way for almost forever now. I wonder how the cities around here have hung on as long as they have.
Or maybe the public has been far more complacent than I realize. I just don’t know, but I found her arrogance to be quite off-putting, and these days I’m more in a mood for venting than I expected to be. It’s all pretty sad, isn’t it?
Lex
@Redshirt:
This particular Repug will point out that the same Labor Dept. report that highlighted the drop in first-time unemployment claims also noted a one-week increase of 250,000 people seeking emergency government assistance because their unemployment insurance ran out.
I’m not saying this to lay any blame on Obama; I voted for him knowing he would inherit a mess. I’m saying this to caution everyone that with several shoes (e.g., commercial real estate) still to drop, we’re a long way from out of the woods.
joe from Lowell
I doubt we even lost 11,000 jobs. The estimates for the previous two months were lowered by over 10 times that figure when revised using more complete data. We almost certainly added tens of thousands of jobs in November.
Morbo
And it looks like Atrios and Krugman think roughly the same thing.
Cat
@cyntax:
Tell me about it, My wife and I used to be very mobile because we were very careful in our hosing choices, but I couldn’t convince her to rent in 2005, We’ve had to turn down better job prospects because selling our house a value neutral transaction for us if we sell given all the ~40k we’ve done in improvements.
I’m not even sure the policies are going to work without the cooperation of the banks in keeping all their REO properties off the market. Though I suppose the Banks have to keep the prices from falling to quickly or they would risk becoming insolvent.
I think in the long run its worse to delay the repricing then having the house prices cut in half and the ensuing fear and panic that would result. The short term suffering would be pretty awful and I don’t know if I would have the heart to do it given the glimmer of a chance the current policies might work.
mk3872
@andy:
Economists are not that dumb, my friend.
They already account for what they call “seasonality”.
The numbers are always seasonally adjusted.
However, because the recovery thus far has been unstable, it is very possible that we will see more spikes in the unemployment rate in 2010.
But barring a catastrophic event, we will likely settle under 10% in early 2010.
Notorious P.A.T.
This is why news like this doesn’t cheer me up. There is so much gaming of numbers. We suffer a net loss of jobs, yet unemployment goes down, huh? Well hey, if we stop defining people who have given up on finding a job as “unemployed”, then we can magically lower the unemployment rate! Voila! Sorry if someone else already posted this.
geg6
@Kirk Spencer:
Your acquaintances fell for a sucker bet. Have they read the Politico article on the GOP WATB moaning about how Al Franken tricked them into supporting rape?
Elie
@JenJen:
There is just such a sense of restless fear — we are in terra incognita — unsure of what “recovery” actually means and how long it will be till that happens. Also unable to accept the structural change in expectations, which as you say, has been happening over a long time. The gap between the expectation and desire people have and what they are able to achieve is growing. The former means used to bridge that gap — credit cards — I believe may be the next big negative shoe to drop…
Cat
@Elie:
You let sweatshops operate in the open, employ underage children, and pay below minimum jobs and then wait for one to burn down. You have to also hope it happens to white people. (/cyncism)
I’m not sure the Union movement can be brought back. People know management is willing to ship the jobs overseas, hire scabs, etc and that fear is powerful as most people know jobs don’t ever come back.
I’m probably being ignorant, but I’m not even sure we have the political bench for a resurgence of the Unions. I cant think of the last time we had a political leader worth supporting in my lifetime ( 40 years ). Maybe things will get bad enough people will start to step up, but any sane and moral person would stay as far away from politics as they can.
Notorious P.A.T.
Oh, so that’s why he demanded a tax increase to fund his Afghanistan surge.
Last year I donated money I couldn’t afford to his campaign. He needn’t call me for his next campaign.
abprosper
The issue is not whether the Feds can create jobs, they certainly can.
The question is will the economy recover enough to make it anything other than a temporary fix bought by debt.
That I really doubt. On top of that we had an enormous two generation baby boom in 2006. All those kids the Gen X and Y folks had will be coming into the work force. Now 15 years is a while off but its a big generation — a slamming fast decent into 3rds world won’t be pleasant, think “world of slums”
What we need is either massive deflation in everything (to meet China tiered wages) or the creation of a lot real jobs for a variety of skill levels that pay well.
Getting to the later this means closed borders and capital controls, at least until we implement smart wealth redistribution and work sharing. This type of near autarchy is tricky when you are dependent on foreign oil.
And before anyone freaks, we had defacto autarchy during our peak. Since most of our competitors had been destroyed we could not only meet our own growing populations needs but “push” our surplus on other countries.
In a production surplus economy, long term, the last place you want to be is the recipient of the “push” — with Europe and Asia having much too much production and both having low demand that puts us in a bad place.
Even so its a medium term fix. Even tight controls will only delay the effects of automation for a while.
Longer run, a couple of generations tops if any sort of market economy and stability are to survive our society will have to become highly distributive,social credit or a truly massive welfare state will be the only options.
Elie
@Cat:
With all due respect, Cat, I don’t think you can know who your leaders would be in advance. Throughout history, people have emerged and I would suppose that this would be no different.
I know that you are right about the fear around unionization. That said, if things got bad enough, the sense of risk might change substantially.
We can’t know fully what is ahead, bad or good and we can’t know what evolving realities will exist to shape our politics. I never think that we won’t have good leaders. Just that we may not have the ultimate need to shape them just yet.
Cat
@JenJen:
New England lost just as much during the same time frame, its just plain ignorance on the tv personalities part. I lived overseas during the 70’s and 80’s and I remember my father, an NCO in the Air Force, talking about all the job losses in heavy and light manufacturing. People knew then and should know now anything else is just ignorance.
Adrienne
@cyntax: Just in time for the kickoff of the 2012 election season if we start upticking soon…
It ALSO means that we’ll actually start FEELING meaningful improvement on the ground by the 2010 election. If that’s the case, the Repubs are seriously screwed as far as the eye can see. WTF could they possibly run on if the we actually start climbing our way of this mess?
Cat
@Elie:
I’m very bad at turning thoughts into written words.
I was trying to imply that our current political class isn’t up to the challenge of pushing meaningful social change that reduces the wealth of the upper class and can be easily turned into a fear based talking point by the upper class to get the middle class against the change. I see those forces in play now as people try to get the Banks and Fed to operate in the open and behave in a fashion that doesn’t just benefit the banks.
I’m probably not as optimistic as you. When I think back on history I ask myself how easily could someone other then Ghandi or MLK been the leaders of their movements. Would their movements been seriously setback or marginalized if Ghandi and MLK never stepped up? Were there other people just as capable as Ghandi or MLK who would have filled the void if they hadn’t existed?
When times get tough you get a revolution, its just sometimes you trade down rather then trading up and looking at our current leaders I’m certain we’d be trading down.
arguingwithsignposts
@Cat:
@JenJen:
It wasn’t just the midwest, or the northeast that lost jobs. Even the petroleum industry in Texas shed a lot of jobs in the mid-80s (remember Unocal?).
Cat, people make the argument that jobs won’t come back. Well, they won’t come back because we have a lot of spineless politicians who won’t *let* them come back, who won’t hold companies accountable or fiscally responsible for the sh*tstorm they’ve levied on the American middle and working class population.
Everyone talks about globalization as a race to the bottom. But it *doesn’t have to be that way.* If someone would stand up for *fair* trade instead of free trade, and frame it as that, things might change. That’s not protectionism, except in the fact that it would be protecting workers around the world by demanding a level playing field.
And my FSM, if I hear one more person talk about *free* trade, I’m going to scream. THERE IS NO SUCH THING AS FREE TRADE! Every government engages in protectionism. There is no free market, as evidenced by the bailouts of late ’08.
I hate Lou Dobbs, but I do agree that someone in the US gov’t has got to start standing up for American workers (including immigrants) in order for this democratic experiment to continue.
Elie
@Adrienne:
They will want Congressional Hearings for his long middle toe which proves he is an alien.
JenJen
@Elie: @Cat: @arguingwithsignposts: The best thing about this site is how much I learn from each of you, every day. It’s really quite astounding, and thank you, and thanks to John for this place.
gopher2b
2009 sucked giant balls
Elie
@arguingwithsignposts:
I think that the US government will start standing up for us when the people insist on it and support it…right now, the former constituency for that, the unions, have been completely crushed under the weight of fears of further job losses as Cat has pointed out, and because of brute ignorance about what constitutes self interest.
.. Too many have nodded their heads like little automatons to the notion that playing to the unfettered free market was in everyone’s best interest and have not paid attention to the consequences right in front of our faces. We have to start talking about that very pointedly and very directly. But don’t expect that to come from our leaders in place now…it will start as conversations and growing awareness among regular folks first…
Elie
@Cat:
Well, the belief that good leaders would not emerge seems a recipe for complete demoralization and that leads to cynicism and inaction. That is just not useful or justified in my opinion.
As bad as these times are, there have been way worse in history. I look and read the comments just on this blog and I can’t help but be more optimistic than not. Not all parts of a wheel hit the ground at the same time, for sure. Events change, evolve and shape people as they roll on. I would never underestimate my companions. I have been pleasantly surprised too often with way far less at stake.
Elie
I would add this as an important aside with wild card implications:
Though there hasnt been much related discussion on the impact of overdevelopment and overpopulation on economic potential, make no mistake, we are up against hard limits in the very near future. How much more growth in atomospheric and water toxins can our planet take and the humans on it?
China is a huge growth engine, but its environment may poison it (and us) before their full potential is ever achieved. How many more automobiles and electronic waste can our planet absorb without eventually backfiring into our safety and wellbeing?
We live very much on a finite planet. At some point the question may not be anything about jobs per se, but dealing with some huge environmental catastrophe that sickens and or kills a fair number of not just the human but plant and animal populations that keep us more a less intact on this planet…
No one much is talking about the necessity of green impacts in all of this. Its still very much a “boutique” discussion point and folks seem to be chuking serious needs for this under the rubric that we just cant worry about the environment when jobs are at stake. I think this is catastrophically wrong thinking and that the impacts on our environment is an international issue of the highest priority…
Cat
What to do about America’s economic future which doesn’t unfairly impose upon everyone elses economic future is a question that has no answer. Not all the actors in the global economy are rational or fair minded. You have countries where poverty and corruption are the current state of affairs and a ruling class that are looting their country, you can’t make them play fair or treat their people fairly. You have countries where the opposition to the corrupt looting politicians are the same people with just different faces.
To many people believe economics is a zero sum game and I’m not sure I can disagree with them given the limited amount of resources our current level of technology provides for us. One day humans may live in a world where resources are practically unlimited, but until then to many people are going to be more worried about making sure the people they care about have food and shelter.
I really can’t fault them for that as I’m not sure I would behave differently enough to claim the moral high ground if I was in their shoes.
arguingwithsignposts
@Cat:
Then make it more costly/ineffective to do business through those countries through legislation and trade policy.
We’ll jump up and down and deny aid and money at the drop of the hat for some countries (like, say, Cuba), but won’t do that for protection of American jobs and economic welfare?
(and yes, I realize that Cat’s above statement at least partly describes my homeland – foam fingers!1!!!)
Morbo
@gopher2b: Huh… you’d think Eli Manning would play better then.
mey
We are nowhere near the bottom.
Cat
@Elie:
I am a cynic. I know any political movement is more likely to be lead by Charles Manson with self control then Mother Theressa. Look at how fired up Palin makes people, imagine how dangerous she’d be if she wasn’t an idiot. You dial down the narcissism a bit and bump up her intelligence a standard deviation and you’d have a political leader who would lead us into oblivion and she’s just your average sociopath.
For every FDR you get a dozen evil POS like Stalin and 50 ineffective, inept, or just plain captured by the elites like Sarkozys/Browns/Berlusconis/Obamas. They don’t progress society they don’t make the world a better place. They may correct a wrong, but doing the right thing isn’t the bar you have to cross to be an excellent leader, its the bare minimum should be expected of you.
I vote, I donate, and get involved in small local issues. On the national level wait and see as politicians who seek to gain a lot of power do a lot of talking, seldom a lot of action for fear of losing their hard gained power.
Cat
@arguingwithsignposts:
I can afford to do so, I am not sure a large enough portion of us can and I worry about what kind of human misery we’d have to suffer through till everyone could. It frankly scares me, the thought of it. I’m not sure we’d make it to the other side before we’d lose hope and change our minds.
arguingwithsignposts
@Cat:
Except we are already doing it with other countries. We’ve suffered through a lot of sh*t as a human race, and even as a country (slavery and the natives come to mind). Look at the situation in China – ecological destruction, slave-ish labor. Or any emerging country. Is that not human misery? Do we want to lift them up in *reality* or through economic models and free-market bullsh*t?
Tax corporations at a reasonable rate, close the loopholes, penalize the “tax-free” off-shore havens, and start penalizing the douchebags who treat workers like sh*t. And let them know that they will not be welcome to do business here if they don’t shape up. It’s not really that hard. It’s just that we’ve been sold a bill of goods by folks like Reagan and the free-market unicorn economists over the last 40 years.
Irony Abounds
Let’s see now, GDP has gone from a negative 6%+ to a positive 2.8% over the past two quarters. The stock market is up approx. 60% from its March lows. Job losses have gone from well over 600,000 per month earlier this year to to essentially 0 this month, and job creation historically lags behind stock market gains and GDP growth. Manufacturing indices show an expanding manufacturing sector. Are there continuing problems? Hell yes there are, but is that such a shocker after such a deep recession? The trends certainly suggest, however, that things are slowly turning around, much as they typically do. If anyone expects an immediate and rapid reversal of the job and economic losses resulting from this recession, say hello to Santa Claus and the Easter Bunny for me – there is nothing anyone could have done to make that happen.
Methinks the people in this country have all the patience of a five year old waiting to open his or her birthday presents. I realize it isn’t easy to be patient if you’ve been out of a job for any length of time, but good God, be thankful tha McCain didn’t win and give us nothing but tax cuts for the rich to ease our pain. My bet is we’d be looking at far worse numbers.
Cat
@arguingwithsignposts:
I know what you are saying, Lets take china for example.
Even if we hadn’t engaged in the exact practices they did durrng our industrial revolution, what would their reaction be to us saying we are going to embargo your goods unless you do exactly as ArguingWithSignposts says with regards to your industry.
The could say no. They are willing to use our military on our own population to quell any uprising. They can just sell everything you have us make for you under our own names and still make money. China hasn’t shifted enough away from their totalitarian society enough that they couldn’t quell an uprising challenging their power and continue on with their exploitation.
This is where things trouble me. Should we behave in such a way that can destabilize another country even if its in their best interest long term? If I could go back in time the answer would be to never start trading with China, but we are in the here and now. If we stop trading with China there would be hell to pay and that’s the only threat they will take seriously. Our China trade policy costs us X human misery and them Y amounts. If not trading with China any more costs both of us more in human misery then we suffer now should we?
I really have a hard time justifying inflicting misery on people just because they happened to be in the wrong place at the wrong time even if its the right thing to do.
At times like this I have to remind myself of the corollary I always add to “The tree of liberty must be refreshed from time to time with the blood of patriots & tyrants”. Sometimes you get to choose who and other times you don’t, but someone always has to suffer.
So, yeah, Bring on the trade wars of 21st century.
Ailuridae
@Makewi:
I’d be cautiously oistic, because hiring usually goes up around the holidays. If the trend continues into January and February then the corner has probably be turned
This is why conservatives always come across as disingenuous or ignorant. Employment numbers are seasonally adjusted. You know, like the holiday season.
mclaren
dlw suggested
Already did that. The Telecommunications Act of 1996. The nationwide phone companies took those hundreds of billions of dollars and instead of putting in nationwide fiber optic, they did…nothing.
No reason to believe the ISPs and cable companies and phone companies would do anything different today. We’d give ’em hundreds of billions of dollars in tax breaks and subsidies, they’d install nothing.
America lags the world at 16th in broadband internet speed and penetration, and it’s falling behind fast. As Robert X. Cringley points out, it’s game over. America will never catch up with the rest of the world in internet speed. We had that chance. We blew it.
Craig
A large chunk of hirings last month were shown to be from the retail industry and the temp industry (i.e. Christmas season employment). Let’s see where the numbers are when the January employment figures come out in February.
zoe kentucky in pittsburgh
The one major reason to have optimism right now is the psychology of momentum and recovery– if people start to think that things are getting better then that alone might actually help that happen. Today’s news can certainly help that perception and that perception matters * a lot*.
I also think that Obama and the dems are smart enough to go forward with a comprehensive jobs bill, it can only help things along and force the Party of No to vote against job creation.