Jobless rate really at 22%?
posted at 10:55 am on January 12, 2010 by Ed Morrissey
The AP gave us a media watershed moment last Friday when it, er, unexpectedly gave a full report on the fact that the joblessness rate hides a lot more misery these days than before. Why? So many people have been out of work for so long that that the Bureau of Labor Statistics no longer counts many of them. The measured labor force — the number of people used by BLS as a baseline to calculate its unemployment rate — has dropped to its lowest percentage since August 1985, merely 64.5% of the American population. Accordingly, the AP’s Christopher Rugaber noted that the underemployment figure has gone to its highest level since 1994, when the statistic first got measured, over 17%.
But does that tell the entire story? John Crudele writes in today’s New York Post that the actual unemployment rate may be much higher than that — perhaps as high as 22%:
I’ve been mentioning that under-employed figure — called U-6 by the Labor Department — for years and I’m glad everyone else has finally caught up.
But that larger figure doesn’t include a huge number of unemployed folks who have given up looking for work because they feel the search is hopeless. Last Friday’s report said 661,000 such people left the labor force in December.
If you count these hopelessly unemployed, the real jobless rate is probably close to 22 percent. If these all weren’t such important issues, this would all be a big joke.
Ironically, one of the Obama administration’s top economic advisers made this same point — only Austan Goolsbee did his complaining in 2003, as Crudele explains:
Back in November 2003 an economist named Austan Goolsbee from the University of Chicago wrote an op-ed piece for The New York Times criticizing a Labor Department announcement about job growth the month before.
And he attacked the idea that the country had just experienced nothing more than a mild recession.
“Unfortunately, underreporting unemployment has served the interest of both political parties,” wrote Goolsbee. “The situation has grown so dire, though, that we can’t tell whether the job market is recovering.”
Did Goolsbee have a point in 2003? A small point, perhaps. This chart from the BLS shows the number of jobs rather than derivatives such as the unemployment rate, and I have added a circle to the period to which Goolsbee referred:
To be helpful, I’ve added a big rectangle to the data from the last two years. Note that the slope of the decline actually remains the same in 2009 as in 2008 before bottoming out in November. The period between 2003 and 2008 is when the Bush economic plan created a massive expansion of jobs, in case anyone forgets that point.
So yes, Goolsbee was right to note that job creation had not yet ticked upward until the third quarter of 2003, and that the unemployment figures masked that to a small extent. But will Goolsbee admit that the unemployment numbers now mask a great deal more misery and job losses — and that the Obama administration’s stimulus attempts did nothing to halt the decline of jobs in the US? Don’t hold your breath.
Update: Be sure to read Jim Geraghty’s take on this. Also, did a couple of minor edits on the final paragraph.
Update II: King Banaian says, “Not so fast” — and he has heartburn over Crudele’s use of the statistics. Crudele’s point on Goolsbee is still undisputed, however.
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Mark Levin has (literally) been screaming this on his radio show for months.
visions on January 12, 2010 at 10:58 AM
Does this really matter unless there is a republican president?
jukin on January 12, 2010 at 11:00 AM
22%? That just doesn’t seem plausible. If 1/5 of the country is out of work, how is it I still have to wait 30 mins for a table at Chili’s on a weekend?
There would be no more traffic during rush hour is there were 20% fewer people going to and from work. Anyone out there driving 65 MPH on an interstate at 8:00am in a metro area?
angryed on January 12, 2010 at 11:00 AM
Pivot.
Trusser13 on January 12, 2010 at 11:01 AM
Things are BAD!! My SIL unemployed for over a year is on a waiting list for the ARMY!!! Unbelievable!
DanaSmiles on January 12, 2010 at 11:02 AM
So in 2 years, our Democratic Congress has undone 4 years of growth under the Republican Congress that preceded it.
And the Obama Recession is making the dot-com bust and 9/11′s hit on the economy look trivial in comparison. Hope and Change FTW!!
jwolf on January 12, 2010 at 11:02 AM
Obama KNOWS what he should be doing. KNOWS, yet does nothing. hmm
marklmail on January 12, 2010 at 11:03 AM
Bout time the Lame Street media acknowledge this.
hawkman on January 12, 2010 at 11:03 AM
In Minnesota at least, it’s explainable. The traffic is generated by Illinois residents arriving to partake of our gold-plated welfare system.
Bishop on January 12, 2010 at 11:03 AM
2%? That just doesn’t seem plausible. If 1/5 of the country is out of work, how is it I still have to wait 30 mins for a table at Chili’s on a weekend?
angryed on January 12, 2010 at 11:00 AM
Credit Cards.
ttime500 on January 12, 2010 at 11:04 AM
The U-6 doesn’t measure the labor force. Its a useful statistic but its not the unemployment rate. I said the same thing when these arguments were used to make GWB’s unemployment seem worse.
Statistics aren’t a political tool.
The unemployment rate is 10%, if you want to know the number of discouraged workers and others not measured in the labor force, those figures are made available to everyone with the BLS reports.
brandozilla on January 12, 2010 at 11:05 AM
I thought U-6 already counted the “hopelessly unemployed”. Aren’t they included in the current 17.3% figure?
Either way, 17.3% or 22%, the economic picture is scary. And while I get the political reason for the Administration to fudge the employment numbers, they can’t hide the declining tax revenue and growing deficits. It seems like Obama and Co. have no real plan for fixing things aside from offering spin and hoping things improve on their own.
Doughboy on January 12, 2010 at 11:05 AM
Hide the decline!
rbj on January 12, 2010 at 11:05 AM
Old news to me. I’ve been saying this for over a year.
I’ve never been on the ‘rolls’ that are counted. Neither have a dozen of my friends. Constantly searching for work, no unemployment to collect.
That’s why I say no matter how Obama spins it, we kinda Know what’s going on out here. We’re living it.
bridgetown on January 12, 2010 at 11:06 AM
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nondhimmie on January 12, 2010 at 11:06 AM
and even the U-6 says 17%, where is the 22 coming from?
brandozilla on January 12, 2010 at 11:07 AM
Don’t know where you are but here, 50 miles South of D.C. I can now walk right in to just about any restaurant on a weekend with no wait. A short while ago the minimum wait in this area was about 1hour on the weekend. This in an area with a very high government worker number too.
Oldnuke on January 12, 2010 at 11:07 AM
How can the bottom of that curve be flattening out, if 660,000 people dropped out of the labor force last month?
MarkTheGreat on January 12, 2010 at 11:07 AM
angryed on January 12, 2010 at 11:00 AM
I have wondered about the same things. I have asked at restaurants and I have been told patrons use plastic. Plastic or not, the piper has to be paid sometime and those credit card bills keep piling up.
amr on January 12, 2010 at 11:08 AM
I’m noticing a few less illegals here in Raleigh. Not that I’m complaining, but apparently they’re moving on…hopefully.
SouthernGent on January 12, 2010 at 11:09 AM
First of all, it depends on what state you’re in. Some are doing better than others, so you’ll see more people dining out.
And I wouldn’t be surprised at all to see crowds at places like Chili’s. They’re one of the more affordable establishments out there. In tough economic times, that’s exactly the type of joint people go to.
Doughboy on January 12, 2010 at 11:10 AM
There were also no Christmas lines here in Atlanta, the malls were ghost towns. People will eat as long as they have credit cards.
DanaSmiles on January 12, 2010 at 11:12 AM
Those are all easy to explain. Yes I can drive 70 at 7:20 am and I live in St. Louis.
As to your Chili’s dilemma, many of those people may have been the ones that were going to more expensive restaurants like Outback or Red Lobster a year and a half ago and now they are cutting back and going to Chili’s, TGI Fridays, Steak N’ Shake, Applebees, etc…
MobileVideoEngineer on January 12, 2010 at 11:12 AM
The quote says it. u-3 counts unemployed, u-6 counts unemployed plus people who are “under-employed”
I don’t care for u-6 as it has a causation problem. Because you are underemployed, it doesn’t necessarily mean the economy is bad; maybe it just means you are incompetent.
The 22% comes from adding 600,000 people who gave up looking for work and aren’t collecting unemployment (thus are not counted in u-3).
lorien1973 on January 12, 2010 at 11:13 AM
The system worked.
farright on January 12, 2010 at 11:13 AM
Gotta say, 22% seems quite credible to me. Close friend is in the freight forwarding business and says his business has just about died. Trucking companies are going out of business right and left, and many of the drivers are independant contractors without unemployment benefits–THEY DON’T SHOW UP on stats–but they are still singularly unemployed.
Crusader Rabbit on January 12, 2010 at 11:13 AM
Yep, I’ll bet it’s hard to find a booth at Mickey D’s.
DanaSmiles on January 12, 2010 at 11:14 AM
Miss the Bush economy yet, Obamacrats?
So does America.
Good Lt on January 12, 2010 at 11:15 AM
B+
search4truth on January 12, 2010 at 11:16 AM
A surplus of workers. You know, the rational thing to do about that is drop the price of work (ei. lower wages). I would much rather be earning less than risk not earning anything at all.
Count to 10 on January 12, 2010 at 11:16 AM
Still not seeing where you are getting this. The U6 is a measure of these people, and that is listed at 17 (still outrageous).
brandozilla on January 12, 2010 at 11:17 AM
Wait until the 2-3 million of unemployed from last January to June get off the rolls. We are going to have unemployment down to 8% as promised.
jukin on January 12, 2010 at 11:17 AM
Glenn Beck went through these numbers yesterday, I believe.
Wouldn’t it be easier to count the employed population? That number, after all, represents the folks who are paying taxes and otherwise adding into the pot of money that everyone else is pulling from.
hawksruleva on January 12, 2010 at 11:18 AM
And yet….after having faced devastation after 9/11….jobs were coming back. Why not now? Because people have no freakin idea what the future holds? Obama is so hell bent on this damn health care crap, and climate change tax, and crap, he’s giving no real thought to jobs, or the economy.
You are absolutely right. No way is anyone in the administration going to say the truth, if it means hurting their precious Obama. Yet…Americans know, and are waking up to the truth. Obama is a fraud, and has no real intentions on improving anything. Destruction is what he does best.
capejasmine on January 12, 2010 at 11:18 AM
I didn’t think they were counted in the U6 number because they technically aren’t in the labor force anymore since they gave up looking for work.
MobileVideoEngineer on January 12, 2010 at 11:19 AM
I think the point has been made that we should not get carried away.
Of course there are myriad factors to account for when computing unemployment and things are different in different parts of the country – some worse off than others. But if this keeps up, at some point, the Left will latch onto a number and start the ‘fearmongering’ meme against us.
catmman on January 12, 2010 at 11:21 AM
u-6 counts people who are collecting unemployment (also in the u-3), plus it counts people who are underemployed. It does not count people who gave up looking for work and are not collecting benefits.
lorien1973 on January 12, 2010 at 11:21 AM
MobileVideoEngineer on January 12, 2010 at 11:19 AM
But that begs another question: How are the folks who have “given up” the jobsearch because it’s “hopeless” surviving? You can’t live on savings forever, and some payments are going to have to be made on credit cards if you’re using those up.
hawksruleva on January 12, 2010 at 11:18 AM
Sure you want to find out how much “under the table” employment is going on, regardless of citizenship? Maybe this answers the “discouraged worker” question.
BradSchwartze on January 12, 2010 at 11:22 AM
Ever seen the meat-and-potatoes economic story?
The idea is that, in Ireland, the demand for potatoes would actually go up as the price rose, because it was the lowest priced food. A price increase in potatoes meant a family couldn’t afford to buy as much meat, so they would buy even more potatoes to make up for it.
Count to 10 on January 12, 2010 at 11:22 AM
If you were to tune into the average talking a$$ on TV, all you will hear is that there was no improvement at all during the last 10 years. They simply compare the numbers from 2000 to 2010 and claim nothing happened in between.
cntrlfrk on January 12, 2010 at 11:23 AM
That’s the work of the Stimulus. These people going to Chili’s and driving on the roads are paid to do this to make you feel that the economy is doing good. All on your dime.
Electrongod on January 12, 2010 at 11:24 AM
MobileVideoEngineer on January 12, 2010 at 11:12 AM
That’s rather interesting, considering that the main E-W freeway (I-64) was closed until last month.
BradSchwartze on January 12, 2010 at 11:26 AM
I drive 270. I live in North County and work in Creve Coeur.
MobileVideoEngineer on January 12, 2010 at 11:28 AM
You are right sorry, haven’t looked at those definitions since Macroeconomics.
brandozilla on January 12, 2010 at 11:28 AM
And Pelosi’s already passed a Stimulus/PORKULUS-2 JOBS BILL:
90% of this 155 billion goes directly to UNION JOBS and the benefactors that will pay for Democrats election campaigns. At 22% unemployment, you can expect the Senate to double this spending measure. It just never ends folks.
Rovin on January 12, 2010 at 11:29 AM
It also does not count the now non working self employed, or independent contractors, like myself and the Four people who used to “work” for me on a Contract basis.
It also does not count folks like my 18 year old son… who just entered the real job market after being a student, or those who just graduated College.
There are a lot of folks who never get into these statistics…
From:
http://www.econlib.org/library/Enc/GreatDepression.html
Pretty scary that the “Great” Depresion, had 25% unemployment… if we are close to 22%…
Romeo13 on January 12, 2010 at 11:34 AM
Saw GW at the Dallas game. Class act….
Must have killed nbc to put his face on tv.
This country was so much better off with him in charge.
ouldbollix on January 12, 2010 at 11:36 AM
I think some one lost some ‘connectivity’ here.
Sir Napsalot on January 12, 2010 at 11:36 AM
Anyone ever wonder why the Social Security Admin doesn’t report on employment? The vast majority of workers are w-2 wage earners. And ll Americans have an SSN. So the SS Administration knows who’s working and who’s not. Small business owners report monthly or quarterly as well so we could have very accurate numbers.
If we wanted to.
BierManVA on January 12, 2010 at 11:40 AM
For something resembling real data, go to Shadow Government Statistics, which shows exactly 22% unemployment, along with a lot of other horrifying numbers.
On second thought, don’t go there. It’s too depressing.
ZenDraken on January 12, 2010 at 11:41 AM
Could the Government be Lying to us?
Chip on January 12, 2010 at 11:43 AM
How about “Unemployed folks who would rather take hundreds of dollars a month from their state government for doing nothing, rather than make minimum wage at Wal-Mart.”
Hell, I just got laid off at the beginning of the year, and being a California resident I get $400 a week for the better part of a year. For doing nothing other than sitting on my kiester and half-assedly looking for work.
If there wasn’t that financed excuse there you can bet that I’d be wearing the blue vest that same week.
TheMightyMonarch on January 12, 2010 at 11:45 AM
Tax cuts voted in during 2003. Democrat congress takes over in 2007. Better correlation to the graph than any globull warming to CO2 graphs.
jukin on January 12, 2010 at 11:46 AM
The Bush economy? Heck, I’m nostalgic about the Carter economy these days!
MJBrutus on January 12, 2010 at 11:48 AM
whoa…dude, 22% that’s like 1 in 80 people ain’t it… that’s just too many
/peterorszagbabydaddy off
ted c on January 12, 2010 at 11:49 AM
Obama..
…..let me be clear..
It’s Bush’s fault…It’s Bush’s fault…It’s Bush’s fault
It’s Bush’s fault…It’s Bush’s fault…It’s Bush’s fault
It’s Bush’s fault…It’s Bush’s fault…It’s Bush’s fault
It’s Bush’s faultTHE BUCK STOPS AT MY DESK
It’s Bush’s fault…It’s Bush’s fault…It’s Bush’s fault
It’s Bush’s fault…It’s Bush’s fault…It’s Bush’s fault
It’s Bush’s fault…It’s Bush’s fautl…It’s Bush’s fualt
Baxter Greene on January 12, 2010 at 11:49 AM
Don’t worry folks we are fixing to get a bump from all those census workers (approx. 1.5 mil.). King Obie’s crew will be blowing again soon that the economy is coming back.
Dire Straits on January 12, 2010 at 11:51 AM
So they’re unemployed and still going out to dinner every weekend?
And WTF since when is Red Lobster expensive?
angryed on January 12, 2010 at 11:51 AM
did they get that glitch fixed in the TOTUS yet?
jus sayin..
ted c on January 12, 2010 at 11:52 AM
I don’t think it was the taxcuts. It just adds to the deficit.
However, Bush and Republican congress did relax the regulatory rules to encourage small businesses and companies.
They have consistently used the words “Small businesses are the driving engines of our enconmy”, etc. and created as friendly an environment as could be.
It worked for a while (as the graph shows), but I don’t know how long that would have lasted. How many nail salons can you have in your four block neighborhood? Some thing else (hint: shrink the unproductives, and the gov troves) needs to be done to ‘stimulate’ the economy.
When people voted in CHANGE, all that’s gone now.
Sir Napsalot on January 12, 2010 at 11:55 AM
I’m wondering if many of these are dual-income families involuntarily making the move to single-income…
dominigan on January 12, 2010 at 11:55 AM
As someone connected to the “workforce development industry”, I can personally attest that for however bad the MSM is reporting things, in reality it’s way uglier.
January is usually a big month for us, all the folks who made New Year’s resolutions to “get a new job” or change careers. In a normal year the phone is ringing with inquires every day.
This year, almost zilch.
The folks who have jobs are hunkering down. The one’s who are running out of UC are depressed and scared shitless. The newly unemployed are ping-ponging between unfounded optimism and paralyzing anxiety.
And in an overwhelmingly blue state, too.
I get a sense that the worm is starting to turn on The One from the “management/data/information” workers who bought into Hope and Change. Less so with labor & service folks.
It’s as ugly out there as I’ve seen since Carter. Maybe worse.
Bruno Strozek on January 12, 2010 at 11:56 AM
Um… I was trying to be nice, but are you that stupid? I was saying that the people you are seeing at Chili’s are still employed, but they were at more expensive restaurants a year and a half ago. The people that were eating at Chili’s a year and a half ago are probably eating fast food now or not eating out at all.
And I guess Red Lobster is expensive for me because I always get the most expensive thing on the menu when I go.
MobileVideoEngineer on January 12, 2010 at 11:56 AM
For decades, once unemployment runs out, the state considers the worker as “having found work”, since the state doesn’t mail him/her a check anymore. This has nothing to do with whether or not the worker HAS found work.
“Stopped looking for work” is an anomaly. I was out of work over a year, and never stopped looking for work, even after my unemployment ran out. I got a less-than-40-hours-a-week job and kept on looking. Anything to pay the rent.
bradley11 on January 12, 2010 at 11:58 AM
I know there isn’t a direct correlation, but that chart makes me think that a hell of a lot of those 7 million jobs created between 2003 and 2008 were construction and related jobs, and most of them were held by illegal aliens. It was a classic bubble, and it burst in 2007.
rockmom on January 12, 2010 at 12:02 PM
Also, doesn’t Chili’s offer the $20 deal for two people to eat (1 starter, 2 entrees, 1 desert) to share? Sounds like a good deal if you want a sit down meal but don’t have much money…
dominigan on January 12, 2010 at 12:03 PM
What do you want? Of course, the unemployment rate is 22%. Our main export to China and India for years has been jobs. Throw that in with Obama’s raft of policies that do everything they can to impede private sector job growth and you’ve got a prescription for Great Depression levels of unemployment.
nerdbert on January 12, 2010 at 12:03 PM
Another day to be grateful I have a job.
cntrlfrk on January 12, 2010 at 12:10 PM
In effect, 2 million have dropped from the employment force since May
May 09 – Dec 09
154956 154759 154351 154426 153927 153854 153720 153059
That is how you avoid 12% unemployment, just remove them from the work force.
WoosterOh on January 12, 2010 at 12:11 PM
Not true they held a summit! And it lasted nearly a full morning!!!! Obama even showed up for a few words at the kick-off meeting. How can you say they don’t have a plan?
In my never humble opinion, I believe that historians will refer to this past wretched year as Obama’s Nero period. While the real issues (terrorism, economy, unemployment) were effectively ignored, Obama and his corrupt party focused on meaningless irresponsible spending and healthcare reform. Nero fiddled, Obama flitted over to Copenhagen to party with Oprah.
highhopes on January 12, 2010 at 12:12 PM
By that logic Ruth’s Chris should be out of business. Instead its share price is up 100% over the past year. Nice try.
22% unemployment = no lines at restaurants. Chilis or Red Lobster or Ruth’s Chris. The fact that there are restaurants and bars and malls still pretty full of people means 22% is BS.
angryed on January 12, 2010 at 12:15 PM
Worse. Carter was well-meaning but incompetent. The current regime is evil. The case can be made, and not immediately dismissed, that the administration is intentionally making the unemployment numbers go up in order to make more Americans dependent on big government for their basic needs. Starting with healthcare, the administration will next start handing out jobs with Soviet-like efficiency. Followed in short order by providing housing.
highhopes on January 12, 2010 at 12:16 PM
You can’t make that connection. Perhaps there are fewer servers so it takes longer to get a table. Perhaps people are still going out but spending less. You simply are using a bogus litmus test.
highhopes on January 12, 2010 at 12:20 PM
And how ever you look at it, there were 600,000 less working in December than in November, yet unemployment did not change, because they removed 700,000 from the workforce column.
It is total BS.
WoosterOh on January 12, 2010 at 12:23 PM
Let me paint a picture for you…
Bob and Carol buy a $300,000 house in 2006 under a government program. They only had to put down $6,000 of their own money to get into it. They both work but can barely make the payments. In order to maintain their lifestyle of regular vacations and dining in the city, they’ve run up $20K in credit card debt. Oh yes, and because their richer friends tend to visit they decided to take a $15,000 home equity line to fix up the house and buy brand new furniture, which they immediately max out.
Bob gets laid off in 2008. They struggle along for a while but eventually they start missing mortgage payments, and they can’t even make the minimum payments on their credit cards.
The bank sends a foreclosure notice, but interestingly enough that’s the last Bob and Carol hear of it. You see, the housing market tanked in 2007, and because they put so little down on their home it is now worth $50,000 less than the note on the mortgage. The bank has hundreds if not thousands of homes in the same situation, and if they were forced to sell those homes at auction they would be rendered instantly insolvent. Fortunately the federal government injected several billion dollars into that bank so the bank can continue to pretend that everything’s kosher.
Meanwhile, Carol gets laid off. They decide that they’re too far behind on their mortgage to even think about getting back in the black, so they stop paying altogether. The bank is getting backstopped by the feds and home prices are still too depressed to even considering repossession, so Bob and Carol get to live in the house free of charge.
Well, Bob and Carol can’t possibly fathom giving up their lifestyle entirely. Both out of work and stuck in the house together, they still need to get out and be entertained! They’re not paying their mortgage, the credit cards were cut off long ago, and the government is paying them a combined $1800 a month not to work, so their options are limited. They may give up the shows in the city and the fancy dinners, but they can go see a movie and get a cheap dinner at Chili’s for under $50.
Starting to see how things are working out? Of course, eventually the bank will repo the property, the unemployment benefits will run out and they’ll be forced to take $10/hr jobs and move into a studio apartment, but better not to think of that now. Oh sure, they could have had the foresight to put a little money away, but saving is something their Depression-era grandparents did, not them.
Oh yes, and to answer your question…entrees at Red Lobster are around $17. You can go to Chili’s and get the couples’ deal where you get an appetizer, two entrees, and a dessert to share for twenty bucks. ;)
TheMightyMonarch on January 12, 2010 at 12:23 PM
I thought U-6 already counted the “hopelessly unemployed”. Aren’t they included in the current 17.3% figure?
Either way, 17.3% or 22%, the economic picture is scary. And while I get the political reason for the Administration to fudge the employment numbers, they can’t hide the declining tax revenue and growing deficits. It seems like Obama and Co. have no real plan for fixing things aside from offering spin and hoping things improve on their own.
Doughboy on January 12, 2010 at 11:05 AM
The plan is not to improve things, see Cloward/Piven Strategy. This combined with “Healthcare Reform” that expands the individual states obligations with temporary Federal support(excepting Reid + Ben & Bill Nelson who got exemptions for their constituents) that later expire, and will leave them with impossible bills. Add on top of this ridiculous bene pckg’s for federal & state workers that AFSCME has secured, is meant to “bring the system down from the inside.”
All is going precisely as planned by the axis of chaos, Obama progressives/Soros & allies/ and former SDS-Weathermen alums, Andy Stern(SEIU) & Paul Booth(AFSCME).
When you look at the utter destruction of our economy and credibility in foreign committments, how the true progressive agenda of the Progressive’s is not recognized ( the removal of American global dominance) can only be explained as willful ignorance.
Archimedes on January 12, 2010 at 12:23 PM
Well as the democrats like to always say, the rich are getting richer so they are still going to their normal places. I mean look at the profit the Fed made over the last year in the deepest recession we’ve had since the Great Depression.
Ruth’s Chris isn’t going to be out of business because they have a loyal clientele. I’ve been to Ruth’s Chris once and I’ve been to Hyde Park (an Ohio steakhouse on par with Ruth’s Chris) three times and all but one of those times I wasn’t the one paying. Not everyone is going to stop going out to eat at their favorite place.
I can tell you that locally people are not eating out as much. My wife and I went to Friday’s this past Friday night and we thought it was going to be packed because we didn’t get there until close to 7 and it’s connected to a hotel. It wasn’t even close to being busy. It was pretty much dead.
MobileVideoEngineer on January 12, 2010 at 12:26 PM
+100
dominigan on January 12, 2010 at 12:33 PM
Are you in Columbus OH?
I’ve been to Hyde Park a few years back when I was presenting to clients for the consulting company I worked for. It was on my company’s dime, back when we were desperate to drum up business.
I’ve noticed that a lot of vendors are hungry right now, and have been more proactive than normal trying to get new business.
dominigan on January 12, 2010 at 12:37 PM
Heh!!
Baxter Greene on January 12, 2010 at 12:40 PM
I used to be, but now I’m in St. Louis because I was out of work for 11 months and couldn’t find anything in Ohio.
MobileVideoEngineer on January 12, 2010 at 12:42 PM
Like Rush said- it’s supposed to be miserable out there. People won’t accept the fundamental change of switching from capitalism to out-and-out socialism unless they are so depressed, so hopeless, that they think glorious Obammunism is the only hope.
Cloward-Piven Strategy.
My bro has been out of work over a year, two of my friends about six months, and multiple friends have had their hours cut back to the point of only having part-time jobs now. My company has been screeching to a halt as clients fear Cap and Trade and the multitude of other taxes and regulations sure to come. Royalties are down 80%, we’ve had to cut to the bare bones and soon will probably be waiting for paychecks.
Two of the biggest local developers are bankrupt, leaving big wineries and hotels up for auction. A local Jack in the Box even boarded up overnight, and our Denny’s went out of business.
Things are grim.
NTWR on January 12, 2010 at 12:45 PM
Just wait until commercial real estate blows up later this year or next. Every boarded-up restaurant, office suite, or business means less revenue to commercial RE owners already on thin ice due to the cash flow-dependent neg-am financing they’re on.
Come to my neck of the woods (a large suburb of San Francisco) and you won’t be able to find a commercial property without multiple vacancies.
It won’t get to that point. Communism was only sustainable through trade with western, free-market economies. Those same economies, having adopted the diminishing returns of socialist policies, have no free markets to support them. It can sputter along for a while but eventually credit will run dry, cash flow will stop, and governments will collapse.
What happens after that can either be a glorious return to laissez-faire economics and limited government, or a free-fall into totalitarianism.
TheMightyMonarch on January 12, 2010 at 1:01 PM
Many in leadership right now are hoping for the latter.
MobileVideoEngineer on January 12, 2010 at 1:04 PM
I agree.
As a business owner I want things to turn around as much as the next person, I just don’t see any policies being put into place to make that happen.
Being in the automobile business, I have seen cost skyrocket (including the price of cars which is killing the wholesale market and independents),labor being cut drastically,and sales plummeting.
The policies of the Obama administration are making things worse and many people from different sectors are stating this:
(via Drudge)
U.S. Chamber warns of ‘double-dip’ recession because of Dem policies
By Ian Swanson – 01/12/10 09:44 AM ET
http://thehill.com/business-a-lobbying/75401-us-chamber-warns-of-double-dip-recession
It is hard for me to believe that the Obama administration does not know they are making things worse.
It really looks like the worse things get…the better the chance they have of government takeover.
The dollar tanking,unemployment through the roof,foreclosures happening at an incredible rate,government spending us into massive debt,the private sector being either taken over by government or run out of business…….where’s the Hope and Change!!!!!
Waiting for the train-wreck
by Martin Hutchinson
November 16, 2009
http://prudentbear.com//index.php/thebearslairview?art_id=10309
70% of our economy is consumer based.
Most people you talk to don’t have any money to spend.
Taxes going up…jobs going down….private sector being eaten alive…..where is the “upturn” in the economy going to come from….more bogus government giveaways like the stimulus and cash for clunkers…all failures.
The Brits have no problem pointing out the disaster we are heading for:
America slides deeper into depression as Wall Street revels
December was the worst month for US unemployment since the Great Recession began.
http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/6962632/America-slides-deeper-into-depression-as-Wall-Street-revels.html
By Ambrose Evans-Pritchard
Published: 6:35PM GMT 10 Jan 2010
I just have not heard any concrete examples,seen any positive policies being instituted,or seen a change in businesses on the ground,that install confidence that the economy is going to make any serious upturn that will prove beneficial to the working class.
This is looking like a disaster of enormous proportions.
Baxter Greene on January 12, 2010 at 1:07 PM
Seeing that over here as well. The only two places where we might possibly have to wait is our local family-owned sushi place (which is a hole in the wall, but we’re such loyal customers that we get a table right away), and Texas Roadhouse, which is frankly too damned good to be recession-vulnerable. ;)
TheMightyMonarch on January 12, 2010 at 1:08 PM
I think at that point their goal will be more along the lines of beachfront property in a non-extradition country.
Until then, the looting of the Treasury continues…
TheMightyMonarch on January 12, 2010 at 1:10 PM
Pretty accurate picture of what is happening, but here is a link to a post at Denninger’s site. I’m not sure what it means. I believe it’s the treasury threatening the banks to make the loan modifications or well force everything out on the table and bankrupt you. I wonder who will blink first. If they carry out the threat then April 1st will be armageddon.
DFCtomm on January 12, 2010 at 1:14 PM
Haven’t been to Texas Roadhouse in a while, but there aren’t as many here and St. Louis has a place called 54th Street Grill that is pretty good and really cheap when it comes to steak. You can get two bacon wrapped 5 ounce Filet Mignon steaks for $11.99 and a 14 ounce T-Bone for $16.99 and the steaks are just as good as Texas Roadhouse.
We may have to go to Texas Roadhouse for my birthday (which is in 16 days). I was thinking Red Lobster, but now that you mention Texas Roadhouse…
MobileVideoEngineer on January 12, 2010 at 1:18 PM
SleeplessinChicago on January 12, 2010 at 1:20 PM
There is already slang for this.
It’s called “drawing”.
I talk to a lot of unemployed people that are detailing and working construction under the table so that they can still “draw” the unemployment benefits.
I tell everyone of them to quit stealing my dam# money and get to work.
They just smile and say as long as the government is handing it out, they are going to keep taking it.
Obama is basically trying to turn the whole US into California.
Baxter Greene on January 12, 2010 at 1:27 PM
Its not recovering and its pretty obvious. The U6 number used to report some of those who were long term unemployed but the current regime made changes recently to the formula as outlined by Ed and now a lot more people are in the “they don’t count” category.
The U3 number is complete propaganda and it was during W’s Presidency also. For a long time we only had ONE unemployment number and it was closer in formulation to the previous U6 calculation.
There is a site that maps the graph of current unemployment to the track of the 1920′s and we are presently very close to a mirror image of that situation, yet the current administration continues to poison the private sector.
The private sector will not start new projects or hire people when they are scared witless about their unknown expenses. They dig deep bunkers and ride it out if they can.
dogsoldier on January 12, 2010 at 1:28 PM
Yeah, Denninger’s been screaming for a while now about the ticking time bomb in failing to enforce mark-to-market. The idea of loan modifications is ridiculous since many of these mortgages are unaffordable at any interest rate. The bus driver making fifteen bucks an hour simply can’t afford a half a million dollar mortgage, no matter how many accounting games you play.
In order to keep people in their homes with affordable mortgage payments you’re talking massive principal reductions, in which case the bank is still taking the loss and the housing market still collapses to where it needs to be. Sure, it would be easier to force mark-to-market, seize the bank’s assets, and pay off the depositors, but that would require Congress to bite the hand that feeds them. Ain’t gonna happen.
Assume everything Congress and the WH does right now is to extend and pretend, and to foist as many of the losses as possible on the taxpayer. Cap-and-Trade and Obamacare have nothing to do with the environment or health care, it has everything to do with backstopping the banking and finance industries with taxpayer money with as little transparency as possible.
TheMightyMonarch on January 12, 2010 at 1:29 PM
Better steaks than Ruth’s Chris, IMO, and for about twenty bucks less. Plus the chili is excellent, the rolls with honey butter are divine, and you can munch on free peanuts to your heart’s content. ;)
TheMightyMonarch on January 12, 2010 at 1:31 PM
I grew up in Fremont :) on the Central Coast now, where it’s always hard to make a living. Now, everyone around here is selling cords of crappy wood, slingin’ Amway, hunting for wild mushrooms to sell to the fancy restaurants, and staying home.
NTWR on January 12, 2010 at 1:36 PM
A related tangent: look to state sales tax revenues for signs of an improving economy. These are reported pretty much as they occur. Lower revenues indicate fewer sales and/or sales of lower priced goods. Higher revenues indicate more sales and/or sales of higher priced goods.
This also allows some comparison between states (not perfect as certain items may be exempt from sales taxes in some states and not in others.)
This metric fails to capture trends in revenue from most services, also.
Still, IMO, a fairly good, near real-time, inidicator of consumer economic activity, which can be related to jobs.
riverrat10k on January 12, 2010 at 1:41 PM
Sheesh, how did you know?! We moved to Fremont last year to become caretakers on my late grandmother’s property. Spending my recently laid-off days trying to convert the front yard into a garden and trying to find work in a dying industry (pharmaceutical sales).
TheMightyMonarch on January 12, 2010 at 1:46 PM
You’ve gotta wonder how many companies are putting off hiring anyone until they find out how much ObamaCare will cost them.
If Scott Brown pulls off a miracle and wins the MA Senate seat, then becomes the 41st filibusterer and ObamaCare finally dies, look for an uptick in hiring, since companies won’t have to worry about ObamaCare taxes any more.
To paraphrase Martin Luther King, I have a dream…
Steve Z on January 12, 2010 at 1:50 PM
Here is another disturbing post at zerohedge. It looks like they are getting ready to handle failures of large banks. Combine that with my earlier post and it seem that they are going to force the underwater banks out into the open and into insolvency. Is this finally some fiscal commonsense or is it all an attempt to force loan modifications down the throats of the banks?
DFCtomm on January 12, 2010 at 1:52 PM
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