In his news conference today, President Obama gave some interesting insight into his views of the state of the American economy.
“The private sector is doing fine.”
Here is the whole quote (via RealClearPolitics):
The truth of the matter is that, as I said, we created 4.3 million jobs over the last 27 months, over 800,000 just this year alone. The private sector is doing fine. Where we’re seeing weaknesses in our economy have to do with state and local government. Oftentimes cuts initiated by, you know, Governors or mayors who are not getting the kind of help that they have in the past from the federal government and who don’t have the same kind of flexibility as the federal government in dealing with fewer revenues coming in.
But is it really? Is the private sector “doing fine?”
1. Private-sector jobs have increased by an average of just 105,000 over the past three months and by just 89,000 a month during the entire Obama Recovery.
In 1983 and 1984, during the supply-side Reagan Boom, private sector jobs increased by an average of 292,000 a month. Adjusted for population, that number is more like 375,000 private-sector jobs a month
2. If the labor force participation rate for May had just stayed where it was in April, the unemployment rate would have risen to 8.4%. As it is, the U.S. economy is suffering is longest sustained bout of 8% unemployment or higher since the Great Depression.
3. Private-sector GDP rose just 2.6% in the first quarter, after rising a measly 1.2% last year.
By contrast, private-sector GDP rose 3.8% in 1983 and 6.5% in 1984 during the supply-side Reagan Boom.
4. The U.S. stock market is down 7% since early April.
5. Real take-home pay is down over the past year.
6. That first-quarter GDP report also showed that after-tax corporate profits dropped for the first time in three years. Major red flag.
No, Mr. President, the private-sector isn’t doing fine at all. And it certainly isn’t ready to deal with a fiscal cliff of tax hikes or a continued deluge of new regulation.
This private sector doing fine/public sector doing poorly talk has been percolating here and there for the past several days. Barney Frank used it in a testy Fox interview today. http://is.gd/0DwgWn
I bet this was theme the Obama administration was testing and I think Obama put an end to it today.
Corporate After-Tax profits are at an all-time high.
http://dailydish.typepad.com/.a/6a00d83451c45669e20163063b7d1f970d-popup
Of course they’re at an all time high. Companies are tightening up and not hiring because they don’t know what their tax situation is going to be on January 1st. They’re also waiting to see how much Obamacare is going to affect their bottom line.
When you run a lean machine, you make money.
Duh.
4. The U.S. stock market is down 7% since early April.
You’re cherry-picking time horizons, Jim. I could just as easily say that the Dow is up 47% since Obama was inaugurated.
Dave I hope you do not think this man has a clue about free enterprise. Obama has failed at every business he has tried to start on his campaign on energy while feeding the pockets of his cousins, DO NOT BE FOOLED this man is so big government he has not a clue as to what makes America great or what makes the coggles turn. He has lied, misrepresented, turned his back on those liberals who tried to help him with any kind of power, he fears his kingdom will collapse if anyone with real power is by his side, he is an absolute curse to this nation and is an abomination before God. To be a part of the church that he attended is enough said.
This guy is a disaster.
He made that statement and 2 hrs later said…no, the economy isn’t doing fine.
Larry, Mo and Curly could do a better job.
The “Private Sector” is the ONLY “sector” that matters. Obama hates private enterprise, except when it can be tapped for cash to support his orgasmic love of “Big Government”! To Obama, the private sector is to be bled as much as possible. Leaving just enough blood to allow it to survive, but to provide the funds for his programs and of course his re-election! The problem is, Mr. Obama has slashed the throat of the private sector “Cash Cow”. This President is an unmitigated DISASTER!
Isn’t it funny what fear will do to you?! You are so right, the very people who have put in office, made him a millionaire and gave him more votes than he will ever know about; He has turned his back on and has lost him the re-election. Thank GOd!
This chart shows the gains and losses in jobs in both the public and private sectors, month by month:
http://i45.tinypic.com/idc708.jpg
As you can see, there has been positive job growth in the private sector over the last 2 years or so. But as you can also see, it is nowhere near enough to compensate for the huge job losses that took place in 2008-2009.
Conversely, the public sector had minimal job losses in 2008-2009. (Civil servants can’t easily be laid off.) But as the economic slump continued, job losses in the public sector became significant in the period 2010-2011. *BUT* as you can also see, those job losses are dwarfed by the job losses in the private sector, and even dwarfed by the *net* job losses in the public sector even when recent job gains are included.
FAIL!
Dave, Nice try, but the President has a failing record by any measure. Simply put, he asked to be elected because he believed, as did you and a majority of Americans, that he could fix the economy and rebuild it for future prosperity. Obama failed. This economy is going nowhere because of this administrations regulatory burdens and anti-growth policies. Obama is a failure.
I appreciate your comments, but I do not think Obama was trying to grow the economy. I think he had an agenda to change us into a socialist nation and that he had no idea, since he never has even been a part of a “real” build something from nothing business, had a clue as to what it takes to help the economy. It is not the governments business to build the economny or job growth, only set the parameters for business to start and grow. Giving away money to banks and big business, was insane, if they want to give money away, give it to the people, they have to pay their debts, make deposits to banks to pay their debts and money is flowing again. The banks have set on the money or invested it and have not released it to the public to be used, so therefore the economny will see slow growth. Obama has always been under gov’t assistance, gov’t loans/grants, and pay. Even his constituants worked for colleges, gov’t and there are no real entrepreneurs by his side because he thinks that they are the downfall of this nation. ANd this idea of wanting what someone else (being against the wealthy) is pure envy and is evil.
You know, I’m not sure I actually believe Dave’s chart, but let’s take if for fact for a moment. A couple things: first, is inflation calcuted in, and second, I’d like to see a similar chart of gross margins. I think that’s a better gauge of corporate health that raw profit.
If you just look at gross margins – that doesn’t mean a whole lot because you are leaving out all the jobs gone, all the businesses that had to close in debt, and owing taxes. Remember its the small business that create the most job growth; and believe me, the way the economy is right now, and you can’t borrow money, no one is really excited about starting a business.
Not sure how old some of these stats are, but we all know 1st qtr. GDP was revised down to only 1.9% last week, and as for the average number of “jobs created” monthly, the “recovery” began in June 2009. I use the non-seasonally adjusted figures to avoid the manipulations the government uses to massage the numbers. When non-adjusted numbers are used, the average private sector job growth falls to below 53,000 per month. According to the BLS the number of those employed has increased by 1,901,000 between June 2009 and May 2012. Do the math: 1,901,000 / 36 months = 52,806 jobs per month
There would be millions more jobs for American citizens if our borders were secured in accordance with Article IV Section IV of our Constitution, our Immigration laws enforced and our Corrupt Politicians would honor their Oath of Office!
All of our cost could be reduced by 10,s of billions if we were not providing free medical, food stamps, welfare, free education, prisons cells, law enforcement, subsidize housing, etc. etc. for millions of invading illegal aliens!
American tax payer,s cannot and should not be required to support millions of other Nations criminals and uneducated parasites!
Preach it brother, I hate to say this though, in Alabama where the laws became so strict on illegals and they abandoned the state, the average person could not endure the labor jobs that were once performed by the Mexicans. But you are right, people come here from So America on green cards and receive supplements from the government. We learned this through hiring them in our business, they were asking us to sign a form for them to receive their $300 per month. We would not sign it and decided that we would no longer hire in this manner. But the shame of it all, is that the average American has been brain washed that if you are a craftsman (not sitting behind a desk or doing socalled profession work) it is beneath you. Such a shame since you appliances, automobiles, rec vehicles, your home, lawn, will not be built or repaired without these type of jobs being filled.
And I wonder how many of those public sector “cuts” work like this: Local military base is cutting 113 positions; 95 are positions not currently staffed (they were authorized but never filled); 10 employees were reassigned to a different department’s budget, and 8 accepted an early retirement bonus package. Oh, the pain of such cuts, from that naughty naughty piece of paper.
Are you trying to say that the economy is fine? If you are, you need to be in business for yourself and know that people are spending about 40% of what they would have spent before 2009 on an home improvement project.
What?
WHAT?!