Litterbury

So full disclaimer: I’m not loaded up with fancy degrees, despite all the book learnin’ that goes on around these parts.

I’m an armchair English major, just as I’m an armchair art historian.  I’m an amateur chef, and budding windowbox farmer, and the biggest politician to ever grace my own living room.  I also happen to be something of a budding economist, which is a timely pursuit given the national condition right now.

I’ve been yammering elsewhere about the economy, but I haven’t made a sustained and coherent argument yet, so one is definitely in order.

First, a bit of a background check.

Roughly three, maybe four years ago I began telling people that the New Great Depression was coming; if only then I had a blog.

Granted the economy was murky then, and one could make a case that things were pretty lousy ever since the first of the second Bush administrations began.  That was a period where the Republican party abandoned every key cornerstone of their political philosophy regarding fiscal restraint and small government in favor of gushing excess.  It left our two-party government no longer operational under appropriate checks and balances and it severely weakened the country as a result.

Whether you disliked him or not, Bill Clinton could count one of the biggest political and economic accomplishments in our country’s history under his tenure: the national debt got paid off, and with a surplus to boot.  That was no minor thing, and whether he could even be credited directly for such an accomplishment didn’t really matter.  He was the one running the show at the time and the buck stopped with him; the Clinton years really were a time of relative peace and prosperity, and that was even a selling point that Hillary Clinton used on the 2008 campaign trail in her own bid for the presidency.

2008 was, in fact, the year of the Democrat.  It was a very exciting year because of the general election, and because both Barack Obama and Hillary Clinton were running for president, as the first African-American and female contenders, respectively, and the country was clearly poised to rally behind one of the candidates in a national rebuff to the Republican party’s lack of discipline.

I supported Hillary Clinton during the 2008 California primary.  I liked her tough-as-nails image, her lovable wonky side and I really believed that she was going to come back stronger than ever and deliver national healthcare reform as she kicked in the White House front doors.  She didn’t win, so I’m not going to talk about her.

It was Barack Obama who won, and while I do like the guy, he makes it hard for me to really love him, and I’m surprised that the qualities that kept me at bay during the ‘08 primary are now so widely apparent as he sits in the oval office.  During his campaign, he and his team took a wait and see approach to everything they did, which didn’t instill much confidence in me.  I also didn’t like refrains of ‘hope’ and ‘change’ because I’ve followed politics for far too long and am jaded as a result.  It was, however, a welcome relief to see him get into office, and to see Bush packing up for the ranch.  He didn’t deliver a good, swift kick in the ass to Bush, which would have delighted me, but the changing of the guard couldn’t have happened soon enough.

So I’m not going to rant, but I now have complaints, since Obama and his administration grossly fumbled with healthcare reform, as handing over a blank tablet for congress to scribble on was like tossing cows over to sharks.  There has also been a complete stall on gay rights, and the administration appears bothered and squeamish should the issue even be brought up.  So I’m dissatisfied and disappointed, though unsurprised.

But there have been a few successes.

Watching Michelle Obama grab a shovel and move ground on a genuine victory garden on the white house lawn pleased both the environmentalist and the foodie in me at once, just as I’m sure it pleased Bay Area chef and activist Alice Waters who had lobbied for such a thing for years.  It seems small to talk about the garden, but it sets a very positive example for the rest of the country and could (and should) inspire everyone to do the same.  It offers quite a bit of leverage in putting some power back into the hands of people, both from a preventative health standpoint and for some much needed economic relief.

And believe it or not, President Obama also did right by the economy as well.  Nobody was comfortable with the possibility of throwing piles of cash at a growing economic hole, but miracle of miracles, it worked, and kept the country from seeing a genuine financial collapse.  Credit also goes to to Ben Bernanke, chairman of the US Federal Reserve and Tim Geithner, US Secretary of the Treasury, two people that nobody really wanted to support.  Together they all delivered a real safety net to halt the country’s financial free-fall, and while it lasted, it worked.

That financial free-fall I mention began years ago, though it would go relatively undetected, but became noticeable and mainstream in mid to late 2007, and accelerated into 2008.  That was the period in which two very big Wall Street names went belly up: Bear Sterns and Lehman Brothers.  While Bear Sterns was rumored to be having major troubles and even mismanagement, the collapse of Lehman Brothers was seen as something of a shocker, and it very loudly announced that a recession was indeed underway if anyone could still stand foolishly to deny it.  That period also seemed to usher in a snowball effect that took down other banks in the process, necessitating a government bailout to prevent a massive financial breakdown.  Toss in a weakening dollar, rising unemployment and then a full-blown housing crisis and it became vastly apparent that this was going to be no ordinary recession.  Two operational wars and a growing federal deficit added insult to injury; and then even individual states were going bankrupt.

The Great Recession was clearly in effect, but I was relieved to see that real action was taking place and things appeared to slow down.  I was humbled, but satisfied to see that my bold, Paul Revere style warnings had been little more than Chicken Little scurrying around the hay.  I called for a New Great Depression, and was happy that it didn’t show.

Until now.

A couple of days ago I came across a few articles that crunched out unemployment data and struggled to squeeze it into percentages and figures.  The claim in the articles, and has been for some time, that the unemployment rate is at, or around 10%; I would disagree with that, but more on that in a second.  The recent articles also had a curious new revelation in which there were ‘monthly’ unemployment numbers that were juggling 17% for a monthly unemployment rate; around 17% for both October and December, if I recall.

This is where the armchair economist in me goes on full display, perhaps, much in the way that scientists toy around philosophically with the Doomsday Clock ticking towards midnight.  I’ve actually been playing with numbers on this matter almost as some sort of new little parlor game, and I always feel confident that national unemployment is situated at 13 to 15%.  The numbers change, sometimes I hold things accountable that I didn’t before, and things alter depending on different articles for different days, but I always feel good about 13 to 15% being the magic numbers.

Now the ‘monthly’ assessment of 17% is cause for concern, and directly puts the assumed national unemployment average of 10% into serious question.

First of all, I find it very hard to believe that unemployment is still kicking around 10% month after month even as a ‘monthly’ average would consistently offer up a rather high number of 17%.  Those monthly averages are not static.  17% from one month to another does not equate stability, and would indicate that even if that percentage is the same, it still is making a case that unemployment keeps rising, and dramatically at that.  If unemployment keeps rising, then there is no reasonable basis to assume that we’re dealing with a 10% national unemployment rate.  This puts me back into confidence with my own fantasy lottery sweepstakes numbers of 13 to 15%.

Then there is another thing.

All the articles that bring up the 17% figure do so by folding in people who are part-time but looking for, or, accustomed to full-time work, and probably people who have given up looking for work out of frustration and are no longer being tracked by the Feds or the experts.  I always make room for the frustrated people who have given up looking for work, as until they find a job, they’re still unemployed in my book.  My 13 to 15% figures are essentially a running (and growing) tally akin to tossing more wood on the pile, part of the reason I feel more confident with my own estimates versus others.

I have a really big issue with including the part-time, wannabe full-time workers, however.  I mean, seriously? Are real world economists actually counting reasonably employed people as unemployed? Who wouldn’t want a dependable full-time position right now? It was within my understanding that if you even have a job pushing a broom you should be kissing the sweet-ass floor in that it meant you could actually claim to be working for a paycheck.  And is this a kosher, even common practice in the economic world? I thought unemployed meant out of work with no prospects, perhaps with qualifying factors of being poor, hungry and no money in the bank.  Granted, that doesn’t even address people who are employed and still having severe financial issues, but that’s a whole other mess.

During the Great Depression that lasted from 1929 to about 1940, national unemployment achieved a staggering 25%.  I had always just assumed that the 25% were fully out of work legal adults, but I wonder; in economic circles what qualifies or defines unemployed, and who exactly made up the 25% from the depression past?

That’s worth digging up because if I had to factor in another couple of percentage points to put my unemployment numbers in the same league as the experts, then my 13% very comfortably becomes 15%, and my 15% percent grows even higher.  High enough to 17%? Maybe.  That wouldn’t be a ‘monthly’ jobless estimate, either, but a baseline level of national unemployment; which is scary.

I’m also curious about what this strange monthly number is in relation to the assumed 10% that keeps getting bandied about.  I’m suspicious that there is the throwaway 10% of losers who should just give up hope, and that there is this revolving-door total that goes up and down on a monthly basis that is viewed and treated independently even though it shouldn’t be.  To put it bluntly, that there is the 10% sitting in Hell, and the added monthly numbers that somehow qualify as Purgatory.

And I’m still baffled as to how unemployment can seemingly sit still at 10% and yet with job losses trending at anything higher than zero on a continuing basis.  It’s very strange.  I don’t do math well, admittedly, but that just appears to defy logic and common sense as well.

If I sound a little hysterical about the whole thing it’s because when I mentioned that the New Great Depression was coming, people looked at me as some sort of tin-foil hat wearing sideshow in polka dots and stripes.  I was very confident that the economy was in for a rough spell but received little more than eye rolls and sighs.  People just wanted to pretend that the situation was going to go away.  I’m feeling the same sense of deceit, if you will, all over again, as things look bad and the experts we lean on don’t seem to have a full grasp on what we’re all talking about.  My fears are bolstered by the fact that I’m beginning to notice that various news articles now seem to be diverging towards different conclusions, and it’s starting to look like not everyone is on the same page.

I consider the unemployment numbers one of the key indicators in regards to our economic health, and pretty much the only way to beat out this dire economic climate is going to reside with job growth.  I also look at even a high number of 15% unemployment still doable as a recession indicator, but getting up to something like 17% is right on the cusp.  I would definitely qualify unemployment numbers at 18 to 20% as a very real depression, which I was beginning to believe we had avoided, but now I’m starting to wonder if we could really hit that magic number.  And when.

History has also shown us that gingerly treating the situation, as the government did in regards to the Great Depression, cannot be allowed if we are to avoid severe consequences.  The government then felt that things were going reasonably well, took away support too early, and then things proceeded to roll back down the hill.  The recent government stimulus plan was painful to pay for, but it was really doing the trick, and there is no reason to believe that further stimulus programs won’t stabilize the economy and protect any progress we’re making long enough for job growth to kick in.

But my old problems with Obama that haunted him on the campaign trail have returned.  His wait-and-see approach is back in familiar form, and it’s benefiting Tim Geithner and Ben Bernanke’s probable conflict of interest issues with their friends on Wall Street.  The war between the Democrats and Republicans isn’t helping matters, either, and with housing a mess, and a weakening dollar, jobs are the only thing to look toward.  I thought things were improving, perhaps, even made safe, but tonight the colander goes back on my head and a wooden spoon goes over my shoulder.