There must have been an unusually good episode of Sesame Street on Friday morning. How else can you explain the Labor Department releasing figures showing the unemployment rate jumping from 5.0 to 5.5%? Apparently Bush was too engrossed in Sesame Street to take the time to edit the numbers before they were released. Can’t you just picture it? Two guys from the Labor Department are standing in the hallway outside the President’s room, shouting through the door, “… but sir, the figures are really bad! Do you really want us to release the actual data?” Comes the reply through the door, “Leave me alone! This is really good! It’s only 8:30 and I don’t have to be at work until 9:00! Oh, boy! There’s Big Bird!!” Says one Labor Department guy to the other, “He ain’t gonna like it, but he can’t say we didn’t try.”
The Labor Department’s monthly unemployment report seemed unusually candid this month. There was no drop in unemployment to accompany the loss of jobs this time. No explanation that “people have just dropped out of the work force.” The news was horrible. Jobs dropped for the fifth month in a row, by almost 50,000. Since the work force actually grows by 150,000 per month (thanks mostly to ridiculously high immigration), that leaves us another 200,000 jobs short. If you’ve been following my running tally for the year, you can do the math and find that we’re now 1,059,000 jobs in the hole for 2008, and we still have seven months left in the year.
Unemployment is actually much worse than 5.5% and it’s only through the use of a very restrictive definition of unemployment that the government is able to mask reality. Do you know how the unemployment rate is determined? The Labor Department takes a survey and asks whether you’ve earned any compensation in return for work performed in the last month. Even if you only earned one dollar, you’re not unemployed. Even if it was for just one hour of cutting the grass for your parents, you’re not unemployed. It’s almost impossible to be counted as unemployed. The weekly jobless claims data gives a much clearer picture. At the current rate of about 380,000 new filings for unemployment benefits per week, that’s an annual rate of about 13% of our work force – a figure that much more accurately reflects the employment picture.
All of this was quite predictable and, in fact, if you read my 2008 Predictions, you’ll find that I did predict a recession and high unemployment as far back as November. It’s easy to do when you understand the theory I’ve proposed in Five Short Blasts. Rising unemployment and poverty (manifested in declining wages and falling net worth) is inescapable when the U.S. continues to rapidly escalate our population beyond its optimum level and then exacerbates the situation by attempting to engage in free trade in manufactured products with grossly overpopulated nations. And its easy to predict that it’s going to get worse. There may be brief, shall recoveries but, if the government fails to change its immigration and trade policies, the long-term trend will be toward rising unemployment and poverty in the U.S.