The U.S. economy created 236,000 jobs in February and the unemployment rate fell to its lowest level since late 2008. This in spite of expectations that higher taxes and federal spending cuts would damage the economy. The number of people who found work in February easily topped Wall Street forecasts of 160,000 jobs. The job creation pace in February was the fastest since November, and entering the new year, the U.S. has averaged more than 200,000 new jobs a month.
The unemployment rate, meanwhile, fell to 7.7% from 7.9%. Experts said the unemployment rate would stay at 7.9%. The last time the jobless rate was this low was in December 2008, before Obama took office.
Yet . . .
“MarketWatch’s” Jeffry Bartash, who supplied the positive figures quoted above, added in his report:
the falling jobless rate stemmed mostly from a small decline in the size of the labor force, reflecting the most negative aspect of an otherwise upbeat employment report. The percentage of people who have a job or are looking for one fell a tick to 63.5% and matched a 32-year low.
Some 22.6 million Americans remain out of work, including nearly 5 million who have been without a job for at least six months. The unemployment rate is an even higher 14.3% when including people who have gotten too discouraged to look for a job or who can only find part-time work.
The market is booming . Wall Street loved the latest jobs figures, sending the Dow (14,397) to an all time high for the fourth day in a row, with NASDAQ (3,244) higher than it’s been since 2000, and the S&P 500 (1,551) within 14 points of its all time high. My FOX Index (see chart), which tracks the distance from 15,800, the “healthy” market minimum total of a Dow of 12,000, an S&P 500 of 1,300, and a NASDAQ of 2,500, reached its all-time high of +3,392. (Obviously, since the Index only began in August 2008.) It’s all seemingly great economic news.
But. . .
While Jeffrey Anderson at the conservative Weekly Standard points out that since March 2009, the Dow Jones Industrial Average has risen about 100% in inflation-adjusted dollars, at the same time, the typical American family’s income has fallen 6% or $3,168 (from $54,752 to $51,584), and the share of employed Americans has dropped by 1.3% (from 59.9% to 58.6%). Anderson believes that
the big government-big business alliance benefits the big guy. . . heavy-handed regulation and cronyism, and . . . redistributing some portion of the [wealth] isn’t actually an effective solution to income inequality. Rather, this approach — an example of trickle-down economics if ever there was one — has managed to undermine growth and equality simultaneously. A far better approach would be to decentralize power.
Most people pay little attention to Obama’s job approval ratings, if they even know such a number exists. But after years of closely following political reporting out of Washington, I’m convinced the almost-daily job approval tracking numbers from Gallup and Rassmussen, along with results from other recent polls and especially when brought together in the “RealClearPolitics” President Job Approval average, is to political junkies what the Dow is to stock brokers.
Few if any Washington potentates refer to the “RealClearPolitics” average. That’s possibly because the site as yet lacks the prestige of Dow Jones, possibly because “RealClearPolitics” seems to lean conservative (while striving to be scrupulously nonpartisan), and more than possibly because the D.C. pontificaters like to think they practice an art, not something reduced to a three-digit number. But the number exists, and its hard for a commentator to write Obama is flying high when his approval rating is below 50%, and the commentator’s fellow scribes all know it.
It’s time for this blog to record, therefore, the fact that Obama’s "RealClearPolitics" job approval average has now fallen below 50% for three days running, something that didn’t happen in Obama’s first term until November 26, 2009, or more than a year after he was elected. As the chart below shows, the president’s approval rating shot up after last year's re-election, probably emboldening him to go after Republicans on tax increases and to defend big spending in hopes of destroying the GOP. It didn’t work, his job approval rating dropped, and recently, his partisan attacks have eased.
Still. . .
Will the economy help Obama, if job growth continues and the stock market boom is extended? Of course it will, and his job approval ratings--closely tied to the economy--will reflect that positive development. But the stock market rise and job gains first have to translate into real economic growth. That hasn’t happened yet.