Is Obama Getting a Pass on the Bad Economy?
As the economy continues to shed jobs, is the Obama administration getting a pass? The front-page story Saturday by Peter Goodman and Jack Healy came under the relatively cheerly headline "Hints of Hope in Jobless Data Even as Rate Jumps to 9.4%." The initial thrust was relatively positive, even with the news of the unemployment rate rising by half a percentage point.
The American economy shed 345,000 jobs in May, and the unemployment rate spiked to 9.4 percent, but the losses were far smaller than anticipated, amplifying hopes of recovery.
Economists described the Labor Department'smonthly jobs report, released Friday, as an unambiguous sign of improvement, yet also clear evidence of broadening national distress, as millions of households grapple with joblessness and lost working hours.
The fact that a report showing the highest unemployment rate in more than a quarter-century was embraced optimistically testified to the stark fears over the economy in recent months.
The American job market remains dreadful and is still worsening, but at a slower pace than before - good news given the stomach-churning events of recent months. The government's monthly employment report buoyed hopes that the longest, most punishing recession sincethe Great Depressionmay be relenting.
Another 539,000 jobs disappeared from the economy in April, and the unemployment rate jumped to 8.9 percent, its highest level in a quarter century, the Labor Department reported Friday. Yet the deterioration was milder than expected, prompting encouraging talk.
The tone was more mordant in Goodman and Healy's April story reviewing the previous month's unemployment rate, which included a prediction by the Obama administration that if their massive stimulus package wasn't passed, the unemployment rate could reach....8.9% by the end of 2009!
Of course, the package passed but the unemployment figure reached the pessimistic 8.9% figure in April anyway, and far surpassed it in May. Why didn't the Times didn't mention it in its unemployment stories for those months?
With 663,000 more jobs disappearing from the American economy last month, swelling the total number of jobs surrendered to the recession beyond five million, the government's response to the downturn is being put to a strenuous test.
When drafting plans in January to spend roughly $800 billion to stimulate the deteriorating economy, the Obama administration operated on the assumption that the unemployment rate would reach 8.9 percent by the end of the year - without the extra federal spending. Three months into the year, the unemployment rate has already soared to 8.5 percent, from 7.6 percent, the highest level in more than a quarter-century.
Contrast the relatively sunny tone of the Obama reports with the negative tone that greeted far better employment numbers during the Bush administration, when the unemployment rate was well below 5%.
"For American workers, the job market is starting to look a lot less inviting.
"The Labor Department reported yesterday that employment grew by just 51,000 jobs in September, adding slack job growth to the emerging tableau of an economy gradually slowed by higher interest rates, expensive energy and a sputtering housing sector.
"In the last three years, the American economy has added about six million jobs. Unemployment, which dipped to 4.6 percent last month, has fallen to the lowest point since early 2001. And in recent months, the wages of ordinary workers have finally started to increase enough to slightly outpace inflation.
"But the new government data, said Joseph LaVorgna, chief United States economist at Deutsche Bank, suggests that 'the best news on job creation is behind us.'"
Yet three years later, a jump in the unemployment rate to 9.4% is grounds for optimism. What changed? Besides a liberal Democrat being in the White House, of course.