Continued weakness in the labor market, which I wrote about this morningmeans the debate over unemployment benefits will intensify.
I’ve already noticed that even leftist scientists like it Paul Krugman and Larry Summers admitted that unemployment was rising when you subsidize unemployment.
And I mentioned some of them good research on this topic by the Federal Reserve Bank of San Franciscobut also other research by academic economists.
But none of this evidence seems to matter, as I discovered in this debate with a former Obama Department of Labor official.
To better understand what I was saying, here are two good anecdotes Ohio AND Michigan.
No less essential, this cartoon is very good at teaching on the economics of unemployment insurance. And if you want to understand the absurdity of the left, this is it post shows that Nancy Pelosi is a train wreck of economic illiteracy.
The Department of Labor just released its data monthly employment report and the White House probably isn’t content.
The report includes some key data such as unemployment rate, net job creation and employment to population ratio.
The results are mediocre at best. Generally, the most attention is paid to the unemployment rate, and this is bad news because the unemployment rate has increased to 8.2%.
This number is particularly painful because the Obama administration claimed that today’s unemployment rate would be less than 6 percent if the so-called stimulation. But as you can see from the chart, a waste of $800 billion on Keynesian package it didn’t work.
While this chart is probably an embarrassment to the White House, I think the most revealing numbers come from: Interactive website of the Federal Reserve Bank of Minneapolisallowing users to compare employment and GDP data across business cycles.
I looked at these numbers a few months agoso I could compare Reaganomics and Obamanomics and the difference is surprising. Reagan’s policies of lower tax rates, spending restrictions, deregulation, and tight money produced much better results than Obama’s statist policies.
The latest numbers, shown below, are no better for the Obama administration.
But I suppose the good news is that the United States is not Europe. The government on the other side of the Atlantic is even larger, and many of these countries are in the middle of a fiscal crisis, with unemployment rates averaging 11 percent.
You kind of start to wonder if there’s a lesson to be learned from this. Maybe, just maybe, bigger government means weaker economic performance.
