Anyone who has been paying attention knows that ever since the Kennedy administration presidents and their data geeks routinely try to tweak unemployment numbers to make their policies look good. The official unemployment rate bears less and less resemblance to reality because it fails to count those who are no longer on unemployment as well as those who have simply given up. That latter number, by the way, continues to grow.
But recently I saw a headline that hailed a drop in unemployment; a whole .4% drop from 9.4 to 9.0 in January. And how many new jobs did our Captains of Industry crank out? 36,000. Now just to give you an idea of how pitiful that performance is, consider that about four times as many jobs must be created each month just to keep up with new workers entering the job market, to say nothing of getting the millions of unemployed back to work. And yet the unemployment rate dropped.
Obviously there is cause for cynicism here. Someone did some incredibly fancy footwork to turn this into a warm fuzzy headline about people going back to work. But what I find equally remarkable, though perhaps for different reasons is that the economic punditry was anticipating about 150,000 new jobs, which would have been a little more than was needed to hold the line, assuming there weren’t any more big layoffs. My question is, how can the be so far off? I mean, even for economists, this is a pretty dismal failure to predict the market. Of course, these are people who create money by fiat, so in their world perhaps it makes sense.
In today’s New York Times Bob Herbert suggests that for the people crunching the data, their numbers have become their own end. They have grown so divorced from from the reality of suffering and frustration that these numbers represent that they cannot or will not be up front with the rest of us about what’s really going on. An important takeaway point here is that you cannot trust the “official” government numbers on unemployment, or inflation or quite a few other economic data for that matter. So if you’re unemployed and can’t figure out why things seem to be looking that much better in spite of the happy talk coming out of Washington, remember: it’s not you. The problem is so bad that the government is actually hiding from it.
