U.S. Economy, Budget, and Bills

[LFC]

Faux News was incredibly disappointed with the jobs report. They were almost giddy that it was expected to be bad because, you know, f*** America. There's political points to score.

Experts predicted a bad jobs report but Americans were very pleasantly surprised when the Bureau of Labor Statistics Friday reported 467,000 jobs were created in January – tripling estimates – and increased the two previous months' jobs numbers as well.

Most Americans, that is.

Take a look at how Fox News was "giddy with anticipation of massive job loss," as Media Matters' Senior Research Fellow Craig Harrington noted, posting this video compilation:

"Fox News, rooting against America," decried Never-Trumper Bill Kristol.

"Real patriots don’t root for failure. But that’s exactly what Fox News does," wrote veteran journalist Jim Roberts in response to the video.

CNN Contributor, World affairs columnist Frida Ghitis: "How embarrassing, Fox rooting for bad news for the country."

John Haltiwanger, a Senior Politics Reporter at BusinessInsider said Fox News was "Rooting for America to fail to own the libs."

And Lincoln Project member and veteran GOP campaign strategist Stuart Stevens wrote this response to the video:

"Most appealing aspect of Reagan era was optimism. To be born an American was to win life's lottery. Now Rs are all fear & pessimism. Grievance. Books are terrifying, America's great cities are terrifying. Immigrants are terrifying. The future is terrifying. A party of the fearful"

[goldenvalley]

Feb 4, 2022 22:13:13 GMT LFC said:

Faux News was incredibly disappointed with the jobs report. They were almost giddy that it was expected to be bad because, you know, f*** America. There's political points to score.

"Most appealing aspect of Reagan era was optimism. To be born an American was to win life's lottery. Now Rs are all fear & pessimism. Grievance. Books are terrifying, America's great cities are terrifying. Immigrants are terrifying. The future is terrifying. A party of the fearful"

Perhaps they'd be called snowflakes if they were Democrats.  One thing is for sure, they aren't afraid of a virus, no sir, not one bit.  

[AnBr]

Feb 4, 2022 19:23:43 GMT LFC said:

Jobs up in January despite Omicron.

And post holidays, when employment usually drops anyway.

[goldenvalley]

So there is good news on the economic front:

While all eyes were on the latest inflation data, some remarkable news from the Treasury Department passed under the radar last week: The U.S. took in more money in January than it spent.

That’s right — the federal government ran a budget surplus last month for the first time since before the pandemic.

It’s just another reflection of an economy that is firing on all cylinders, and improving the fiscal picture at the same time.

It may also signal a turning point that White House officials have flagged since last summer, as fiscal policy shifts from bolstering economic growth to holding it back, White House economist Jared Bernstein said Friday.

Month-to-month federal revenue and spending can be volatile — tax receipts always go up in the spring when people file their taxes, for example — so it helps to look at the trend over a 12-month period.

Federal revenue for the 12 months that ended in January was up 27.6 percent from the year before, as rising wages, low unemployment and robust economic activity push up individual and business tax receipts.

Government spending for the 12 months that ended in January was still about 45 percent higher than it was in the year before the pandemic. But compared with the same period a year earlier, spending fell 3.4 percent — the first time 12-month outlays have declined since May 2014 — as the government spent less on pandemic aid and safety net programs, such as jobless benefits.

 

[LFC]

I saw some squawking about jobs and the economy so I decided to look up U6 (the most inclusive measure on unemployment) as well as U3 (the one that makes it on the news). We're real close to pre-pandemic levels of unemployment. U6 was 7.0% pre-pandemic spike and it's now 7.1%. U3 was 3.50% pre-pandemic spike and it's now 3.80%.

Here's the graph.

U6 Unemployment Rate

[LFC]

Biden's bragging a bit. It's good to get in a little counter-programming to push back against the right-wing propaganda machine.

Democratic elected officials from the President on down are frequently criticized by their own voters for not touting their accomplishments enough. On Thursday as he attends an emergency meeting of the leaders of the G7 and NATO in Brussels to discuss Russia's illegal war on Ukraine, President Joe Biden issued a statement on today's historic drop in unemployment.

"This morning, we received news that the number of Americans on unemployment insurance fell to its lowest level since 1970 and the number of Americans filing new claims fell to its lowest one-week level since 1969," President Biden said in the statement from the White House Press Office. "Americans are getting back to work at a historic pace, with fewer Americans on unemployment insurance today than at any time in the last half century."

"This historic progress is no accident: it’s the result of an economic strategy to grow the economy from the bottom up and middle out, starting with the American Rescue Plan," the President's statement adds. "And, it’s the result of effective management of emergency pandemic resources that resulted in 75% of adult Americans vaccinated and 99% of schools re-opened."

"We have more work to do to cut costs for families, but today’s data are a reminder that the U.S. economy is uniquely well positioned to deal with the global challenge of inflation. We will continue the fight to lower costs with every tool at our disposal, from making more here in America and rebuilding our supply chains, to lowering costs that have held back Americans for decades, to promoting competition to ensure markets can operate effectively and consumers are protected."

[LFC]

The jobs picture is still looking good.

America's labor market is roaring back, adding another 431,000 jobs in March and bringing the unemployment rate to a new pandemic-era low of 3.6%, the Bureau of Labor Statistics reported Friday.
Prior to the pandemic, the jobless rate was at 3.5%, matching the near 50-year low first set in 2019.
Even though the job gains were lower than economists had expected, they still rounded up a strong first quarter for the US labor market with an average monthly gain of more than half a million jobs. March was the 15th straight month of robust job gains.

The economy is now just 1.6 million jobs -- or 1% -- short of where it was in February 2020, before the pandemic hit, according to the BLS. That means the country is on pace to bounce back from the pandemic recession almost eight years faster than it took to recover from the Great Recession.

Several labor market measures are already close to their pre-Covid levels, the BLS said Friday. That includes the total number of unemployed people, which fell to 6 million in March, as well as the number of permanent job losers, which declined to 1.4 million.

[LFC]

At the current employment / unemployment rates and the number of jobs currently open I'm not shocked that there's a hiring slowdown. It's still a pretty decent number, just not a go, go, go kind of number. The Fed is still worried about inflation so there may be more rate hikes to come.

American employers slowed the pace of hiring in August after the surprising surge in the prior month and the jobless rate edged up, according to government data released Friday, which could offer the central bank some relief that its inflation-fighting efforts are working.

The Federal Reserve is paying close attention to the progression of the hot job market, looking for signs of easing as it tries to cool the economy with steep interest rate hikes to tamp down inflation which has reached a 40-year high.

While the data showed wages continued to rise, the unemployment rate ticked up as more workers joined the labor force, a welcome development that could allow the Fed to opt for a smaller move later this month after two consecutive super-sized rate increases.

President Joe Biden, who has been riding a wave of legislative and economic victories, cheered the latest report.

"More great news: Our jobs market remains strong. Even more Americans are coming back to work," Biden tweeted.

Even with the slowing pace, the job gains bring employment above the pre-pandemic level, the Labor Department said in the closely watched monthly report.

The US economy added 315,000 jobs last month, the report said, which was in line with what economists were expecting after 526,000 hires in July.

The unemployment rate moved back up to 3.7 percent, after dipping to 3.5 percent in the prior month, according to the data. And the labor force participation rate rose three-tenths to 62.4 percent.

But wages continued to climb in August, as average hourly earnings rose another 10 cents, or 0.3 percent, to $32.36 -- slower from the pace in recent months. Over the past 12 months, worker pay has increased by 5.2 percent.

Continued upward pressure is a cause for concern since the Fed fears it could lead to a wage-price spiral and push inflation higher.

[AnBr]

www.nbcnews.com/nightly-news/video/companies-bringing-jobs-back-to-u-s-amid-reshoring-surge-147288133777

[LFC]

Sept 2, 2022 21:55:01 GMT AnBr said:

www.nbcnews.com/nightly-news/video/companies-bringing-jobs-back-to-u-s-amid-reshoring-surge-147288133777

The world is becoming a less stable place and the risk/reward calculations are changing.

[LFC]

Unemployment goes down and the stock market drops. [sigh]

The employment picture started off 2023 on a stunningly strong note, with nonfarm payrolls posting their strongest gain since July 2022.

Nonfarm payrolls increased by 517,000 for January, above the Dow Jones estimate of 187,000 and December’s gain of 260,000.

The unemployment rate fell to 3.4% versus the estimate for 3.6%. That is the lowest jobless level since May 1969. The labor force participation rate edged higher to 62.4%. A broader measure of unemployment that includes discouraged workers and those holding part-time jobs for economic reasons also edged higher to 6.6%.

“Today’s jobs report is almost too good to be true,” wrote Julia Pollak, chief economist at ZipRecruiter. “Like $20 bills on the sidewalk and free lunches, falling inflation paired with falling unemployment is the stuff of economics fiction.”

Markets, however, fell following the report, with the Dow Jones Industrial Average down about 100 points in early trading.

Growth across a multitude of sectors helped propel the massive beat against the estimate.

Leisure and hospitality added 128,000 jobs to lead all sectors. Other significant gainers were professional and business services (82,000), government (74,000) and health care (58,000). Retail was up 30,000 and construction added 25,000.

Wages also posted solid gains for the month. Average hourly earnings increased 0.3%, in line with the estimate, and 4.4% from a year ago, 0.1 percentage point higher than expectations though a bit below the December gain of 4.6%.

“When you look at this, it’s pretty hard to shoot any holes in this report,” said Dan North, senior economist at Allianz Trade North America.

The surge in job creation comes despite the Federal Reserve’s efforts to slow the economy and bring down inflation from its highest level since the early 1980s. The Fed has raised its benchmark interest rate eight times since March 2022.

In its latest assessment of the jobs picture, the Fed on Wednesday dropped previous language saying gains have been “robust” and noted only that the “unemployment rate has remained low.”

However, Chairman Jerome Powell, in his post-meeting news conference, noted the labor market “remains extremely tight” and is still “out of balance.” As of December, there were about 11 million job openings, or just shy of two for every available worker.

[LFC]

Tomasky on the lasting stain of Grover Norquist and the destruction of reasonable budget negotiations.

President Biden unveiled his budget last week, and everyone immediately pronounced it dead on arrival. This is because the proposal has—gasp!—tax increases. The Republican Party won’t tolerate them, so the budget is dead.

Yes, Biden proposes to increase several taxes. They’re all on plutocrats and corporations: a billionaires’ minimum tax, a stock buyback tax, a higher capital gains rate for the wealthiest investors, an increase in the tax that sustains Medicare on dollars earned above $400,000, a hike in the top marginal rate for individuals and couples, and so on. He proposes these increases not just for kicks, of course, but to pay for public programs for the rest of us that he wants the federal government to support.

Congress has failed to pass a budget on time almost every year for the last 45 years. There are many reasons for this sorry state of affairs. But there is one that stands out over all the rest. Democrats and Republicans can’t negotiate a budget anymore because only one side is willing to negotiate. That is to say—Democrats are willing to discuss the budget cuts Republicans want. But Republicans are not willing to discuss the tax increases Democrats want. And you can thank one man in particular.

Yes, the Republicans are to blame.

Norquist’s pledge has done more to destroy policymaking and derail the normal horse-trading of the legislative process than any other single development of the era. Let’s consider a scenario: Congress says, We need to spend some money on X. To oversimplify a bit, there are only basically two ways to do it. Take money from Y, or raise more revenue, or some combination thereof. That’s how politics usually works.

It’s how it worked in 1983, for example, when Ronald Reagan and Democratic House Speaker Tip O’Neill made a deal to keep Social Security solvent. They combined the cuts the Republicans wanted (notably raising the retirement age) with the tax increases Democrats wanted (hiking the withholding tax). At the last second, there was an impasse. They averted crisis by agreeing to tax the benefits of the very wealthy. The Republicans on a commission appointed by Reagan agreed to this, as did enough Republicans in Congress to pass it, as did of course Reagan himself, who signed it into law.

But since 1990, with a few minor and often temporary exceptions, Republicans in Congress have not voted for a single tax increase. That’s 33 years of obstinacy. Vast new forms of wealth have been created in those years, massive fortunes built, trillions of dollars—$50 trillion to be precise, according to a 2020 Rand study—of wealth transferred from the middle class to the very rich, and not a single Republican has voted to increase a tax.

This is not just income taxes, by the way. It’s any tax. The last time the federal government raised the gas tax was in 1993, in Bill Clinton’s first budget, 30 years ago. It’s been 18 cents a gallon ever since. What’s the problem with that, you ask? Well, the gas tax, like the taxes Biden proposed last week, isn’t imposed for fun. It pays for road repair and mass transit (and to maintain the safety of gas storage tanks across the country). It should have been going up at a steady though not onerous rate for all those years. There’s a reason our roads and bridges are crumbling, and the reason is that Republicans won’t pay for upkeep.

Meanwhile at the state level...

Since I mentioned the states, here’s another valuable point worth making about the pledge. In Congress, 42 senators and 189 House members have signed the pledge. All are Republicans, which means that 86 percent of GOP senators and 85 percent of the party’s House members have signed on to participate in a permanent stranglehold on policymaking.

You will sometimes see a Washington journalist write a lazy sentence like, “Norquist has a similar stranglehold over most state legislatures.” But this is not remotely true. Sunday morning, I went to the Americans for Tax Reform website and counted.

In lower state Houses, of 2,889 GOP members, just 662 had signed the pledge. (Note: ATR asks candidates to sign the pledge in every election cycle, and its list includes incumbents and nonincumbents, so my 662 could be off by a little bit, because I didn’t go check whether every nonincumbent signatory won—I checked a few—but in any case, the number of nonincumbent signatories was small, so if my 662 is off, it isn’t by much.)

Think Norquist has a stranglehold on, say, Ohio, one of most radical-right legislatures in the country? Only five of 65 signed there. You’ll see similar ratios elsewhere: Indiana, 13 of 70; Georgia, 15 of 101; Wisconsin, 15 of 64; Pennsylvania, nine of 100; Montana, eight of 67; Florida, 29 of 84; Texas, 31 of 86; Kansas, eight of 85. And so on. I didn’t run the state Senate numbers as fully, but I looked through them, and they’re the same: In Louisiana, two of 27; in Utah, four of 23; in Mississippi, seven of 36.

Why do these state legislators have such an apparently different view of the pledge from Washington counterparts? Because they live in the real world. They have to balance budgets, so they know that sometimes you have to increase a tax. It’s only in the fantasyland of Washington that Republicans can be so insanely irresponsible.

[AnBr]

This reminds me about how Repukes demonized 'earmarks'. They dismissed them as nothing more than pork barrel. They swept under the rug the fact that the so called earmarks were part of the lubricant used to smooth through deal making. Ever since then it has required near super majoritys to get through even more moderate bills.

[LFC]

Mar 21, 2023 14:14:14 GMT AnBr said:

Ever since then it has required near super majoritys to get through even more moderate bills.

Super majorities that have to be created out of a Congress which includes a large group who practice, "If they're for it, we're against it." Good luck with that.

[LFC]

We heard over and over that people weren't willing to work. In fact, when adjusted for age, the labor participation rate is quite high. Other factors like retirement and disability had little effect.

The U.S. labor force participation rate (LFPR) currently stands at 62.5 percent, 0.8 percentage point below its level in February 2020. This “participation gap” translates into 2.1 million workers out of the labor force. In this post, we evaluate three potential drivers of the gap: First, population aging from the baby boomers reaching retirement age puts downward pressure on participation. Second, the share of individuals of retirement age that are actually retired has risen since the onset of the COVID-19 pandemic. Finally, long COVID and disability more generally may induce more people to leave the labor force. We find that nearly all of the participation gap can be explained by population aging, which caused a significant rise in the number of retirements. Higher retirement rates compared to pre-COVID have had only a modest effect, while disability has virtually no effect.

[LFC]

I'm repeating this WaPo piece over here. Inflation is dropping and employment is strong.

Employment is historically strong. Not only is unemployment at 3.5 percent (matching a 50-year low), but Black unemployment has dropped to 5 percent. The Black unemployment rate has never been lower.

As financial analyst and investor Steven Rattner puts it, “Historically, the Black unemployment rate has averaged over twice the White rate. Today, the gap between the Black and White unemployment rates is among the smallest ever.” He adds, “To put this in further historical context, in 2010, during the financial crisis, Black unemployment hit 17 percent. And in 1983, another recessionary period, it reached 21 percent.”

In other words, the robust recovery has been a rising tide lifting all Americans, including those who might have been left behind in other economic comebacks.

As Rattner notes: “Since January 2020, real (after-inflation) incomes of the bottom quartile (households earning $35,000 a year or less) have risen 7 percent, compared to 2 percent for those at the top and an average across the economy of 1.3 percent.”

Apparently the collapse of SVB finally put the fear of overlending into these institutions. Before that they just kept pushing out the loans. Remember, these are the companies Republicans want to regulate more lightly.

In normal times, surveys on banking conditions are released with little fanfare. Now, there is an increased appetite for data on how banks across the rest of the country are faring.

Why it matters: After the string of recent bank failures, analysts are wondering whether a pullback in lending activity is rippling through the economy.

[LFC]

Welcome to the Biden Economy, one where real actions and investments have taken place, not fake deals and taking credit for the carryover from the previous president like Trump.

The Biden administration’s efforts to revive U.S. manufacturing appear to be succeeding, with some business sectors plowing in almost 20 times the investment in new U.S. manufacturing projects versus only a few years ago.

Joe Biden made bringing manufacturing jobs and investment back to the U.S. a cornerstone of his presidential campaign in 2020. While he has yet to formally announce a widely expected reelection bid, the president will likely lean heavily into two major legislative wins during his term that unlocked billions to support new U.S. manufacturing—last year’s Inflation Reduction Act and the CHIPS and Science Act.

Together, the two landmark acts inject over $400 billion into clean energy technology and semiconductor manufacturing in the form of government incentives and subsidies, as well as create thousands of new jobs. It’s been less than a year since the two packages were passed, but the fresh funds appear to be accomplishing some of Biden’s goals already.

U.S. companies have committed over $200 billion to new manufacturing projects since the bills passed, according to a Financial Times analysis Sunday. The largest investment has been in clean tech and semiconductors, where new financing is almost double what it was in 2021 and nearly 20 times above 2019 levels. The number of large projects that have attracted more than $1 billion has also exploded, up from four in 2019 to 31 currently, the FT found.

It sounds like Manchin may have been outflanked, thank goodness. Compare this (bold mine) to the over $2.5T Republicans dumped into tax cuts in 2017 that didn't produce anything like this. 

Some in Congress have continued to criticize the spending package, including Democrat Sen. Joe Manchin, whose signature was vital to the Inflation Reduction Act’s passing last year. Manchin, who has subsequently been critical of the IRA’s tax credit provision for electric vehicle buyers, claimed in a Wall Street Journal op-ed last month that the law had been distorted to “advance a partisan agenda” and risked increasing “clean-energy spending to potentially deficit-breaking levels.”

While the packages have already helped boost U.S. manufacturing, the spending involved has come under renewed criticism recently for higher-than-expected costs. Last month, Goldman Sachs analysts found that subsidies from the Inflation Reduction Act would actually cost around $1.2 trillion, three times as much as what had been originally earmarked. Conservative observers criticized the higher price tag, although the Goldman analysts added that the subsidies would also trigger $3 trillion in private sector investment.

To be fair the Republican tax cuts did manage to spur record stock buybacks. Yipee!

[andydp]

TONS of good data and talking points in the article.

For the next time some idiot tries to tell you the GOP is 'The Party of Business'

As predictably as the sun rises and sets, every Sunday sees a commentator or politician on one of the Sunday political talk shows say — without being challenged — words to the effect that the Republican Party understands and supports business better than Democrats. This weekend, as I recall, it was CNN‘s turn.

All my life, in fact, I’ve been told by the media that the GOP is the “party of business.”

It may have once been true when I was a very young child, but today it’s a lie — and has been so in a huge way since the neoliberal Reagan Revolution.

Between 1933 and 2020 there were 14 American presidents, 7 Democratic and 7 Republican.

The economy during this time grew at an average rate of 4.6% under the Democratic presidents, but only an anemic 2.4% under Republican presidents. For example, the economy has grown three times faster under Biden than under Trump.

Ten of the past 11 recessions began under Republican presidents, although lifelong Republican and Trump Fed appointee Jerome Powell seems hell-bent on producing one for Joe Biden, just in time for the 2024 election.


www.msn.com/en-us/news/politics/for-the-next-time-some-idiot-tries-to-tell-you-the-gop-is-the-party-of-business/ar-AA1aFuIj?ocid=msedgntp&cvid=f46e4d30aca046ccb14cd19f43c6aa73&ei=34

[LFC]

They are the party of certain businesses, who profit greatly from their special status and pay the GOP off handsomely. Oh yeah, "the market" works and we shouldn't be putting our thumb on the scales, or something like that.

[LFC]

Things are still good, but hopefully not so good that the Fed hikes interest rates again.

U.S. job growth accelerated in May, but a jump in the unemployment rate to a seven-month high of 3.7% suggested that labor market conditions were easing, which could give the Federal Reserve cover to forgo an interest rate hike this month.

The increase in the unemployment rate from a 53-year low of 3.4% in April reported by the Labor Department on Friday was mostly driven by Blacks. It was also partly the result of more people entering the labor force, an increase in supply that is reducing pressure on businesses to raise wages.

Wage growth moderated last month, which should offer some comfort to Fed officials battling to bring inflation back to the U.S. central bank's 2% target. The closely watched employment report offered more evidence that the economy was far from a dreaded recession, despite weakness in the interest-rate sensitive manufacturing sector and the housing market.

"American businesses are still aggressively hiring, likely to meet resilient consumer demand," said Sal Guatieri, a senior economist at BMO Capital Markets in Toronto.

"However, the other areas of softness in this report suggests that the labor market is losing steam. There's likely enough pockets of softness in this report for the Fed to pass on raising rates at the next meeting."

The survey of establishments showed nonfarm payrolls rose by 339,000 jobs last month. Economists polled by Reuters had forecast payrolls increasing by 190,000. The economy created 93,000 more jobs in March and April than previously estimated.

The economy needs to add 70,000-100,000 jobs per month to keep up with growth in the working-age population.