Keep the Hopenchange: Personal incomes drop
posted at 4:10 pm on March 26, 2010 by Ed Morrissey
How bad was 2009 for Americans? Rampant unemployment got combined with huge pricing signals for higher taxes and costs for businesses in a way that had everyone squeezing pennies until Abraham Lincoln squealed. Not surprisingly, the recession and those pricing signals added up to a big negative for American income in 42 states:
Personal income in 42 states fell in 2009, the Commerce Department said Thursday.
Nevada’s 4.8% plunge was the steepest, as construction and tourism industries took a beating. Also hit hard: Wyoming, where incomes fell 3.9%. …
Nationally, personal income from wages, dividends, rent, retirement plans and government benefits declined 1.7% last year, unadjusted for inflation.
Guess where the pain was felt the least?
Incomes stayed flat in two states and rose in six and the District of Columbia.
Gee, I wonder why incomes rose in DC?
K Street’s top 25 firms cashed in on the aggressive legislative agenda unleashed by the new president and bigger Democratic majorities in Congress in 2009 to post double-digit growth of about 10 percent over the previous year.
Despite economic uncertainty and the promise by the Obama administration to clamp down on the influence industry, the majority of top lobbying firms posted higher numbers in 2009, with 11 firms showing dramatic growth.
How’s that Hope and Change working out for America, anyway? Not too well, according to RealClearPolitics columnists George Bittlingmayer, Arthur Havenner & Thomas Hazlett (via Jim Geraghty):
Counter to the predictions put forward a year ago by the Administration, when it claimed that “more than 90 percent of the jobs created are likely to be in the private sector,” U.S. companies employed 3.9 million fewer workers in January 2010 than they did one year earlier. Public employment bucked the trend, staying constant even as governments contended with sharply reduced tax revenues. While the jobs held by those 22 million public workers helped support many families, the “stimulus” failed to trigger private sector employment growth.
In late 2009, the Congressional Budget office pegged employment gains due to the American Recovery and Reinvestment Act (A.R.R.A.) of 2009 at 600,000 to 1.6 million, while estimating its full cost at $862 billion.
This implies a price tag, at the median estimate, of about $800,000 per job. These forecast job gains are not permanent, but temporary. The Administration’s January 2009 forecast was that the A.R.R.A. was needed to reduce the path of unemployment for five years, when the unemployment rate – if we did nothing – would decline to the level projected with the “stimulus.” Using this five-year time horizon projects annual costs of approximately $160,000 per job.
Jim calculates that to reach Obama’s Porkulus claims, we would have to have a net job creation of over 730,000 jobs per month from now until the end of the year. I guess that’s where the hope comes in handy.