That’s a clunky title for this post, but I couldn’t think of any other way of expressing the potential political impact of a very muddled employment situation.
Let’s start with the obvious. The White House is very happy about the recent numbers showing that the unemployment rate has dropped to 7.8 percent. And since I predicted a long time ago that Obama would win reelection if the joblessness rate dropped under 8 percent, I can understand their relief.
But in this CNN interview, I point out that we still have a big problem with labor force participation and I explain that Obama is way behind Reagan in terms of job creation (as shown in this remarkable info-graphic).
I also make the point that the unemployment rate is far higher than Obama promised when we enacted the so-called stimulus.
But most importantly, I cite the Minneapolis Fed to show that Obama has the worst performance – whether looking at GDP growth or job creation – of any post-World War II president.
P.S. Apologies for being underdressed. I was in Virginia Beach for a softball tournament and didn’t expect to be in front of a camera (and I wasn’t full of smiles since my one-a-year achievement didn’t occur until the following day).
America does not need to get to the point where any incentive to produce is removed for the American middle class standard of living to come down from the ivory tower Americans seem to take for granted with near metaphysical faith. All that needs to happen is for America to drop down a few notches from being the most fertile environment for high value business. That requires the exploration, parallelism and diversity of private enterprise, as opposed to the “we’re all in this together” unifying and homogenizing central planning, and also requires the motivation associated with being able to keep the fruits of your labor and not being insulated from the consequences of mediocrity. On all these fronts, America is no longer at the top and the point of no return has passed. It is only a matter of time, a short time, before past momentum stalls and the American standard of living — where the American middle class is in the top fifteen percent of worldwide wealth — starts a rapid convergence towards the world average.
I am worried that Obama just doesn’t get it. Teaching an entire society to live on the dole and hand outs removes any incentive to achieve, much of anything. It didn’t work in other countries and it’s not going to work here either.
As I said before, Obama does not simply represent a slower return to normal — that would be peanuts. He represents the permanent and most likely irreversible transition to a slow growth America. And, slow growth to those who understand the ementary arithmetic of compounding means decline — no matter what the starting wealth point is.
Remember that the “giving” part of ObamaCare, the incentive to indolence and withdrawal from the workforce has not even kicked in yet.
When historians will look back at the early twenty first century on a historical timescale, they will brand America’s decline “precipitous” — although by then, the world will most likely be moving even faster.