Wednesday, January 7, 2009

More Bad Economic News

(Our economy at sea.) Image credit: Found here.

All you have to do is click on the keyword economy off to the left of this article to see what a sorry state things have been in lately. The only good news I've seen lately is that economics Professor Paul Krugman has confirmed my earlier estimate that our economy is about three million jobs behind right now. If a Nobel prize-winning economist and an idiot savant economist can both arrive at that conclusion, you have to wonder what these douchenozzles are looking at. My guess is their navels.

When the good news is that one of my wild-ass guesses is right, you know the rest of the news is pretty bad.

To start with, we're now at least 3.7 million jobs behind:

U.S. private employers shed 693,000 jobs in December, up sharply from the revised 476,000 jobs lost in November and far more than economists estimated, a report by ADP Employer Services said on Wednesday.

The data comes two days ahead of the government's more comprehensive non-farm payrolls report, which unlike the ADP numbers includes public sector jobs as well.

Private Job Losses Mount, Ominous For Payrolls

Add the public sector, where state and local governments have started to lay off people to pay for budget cuts, plus another 100,000 or so new potential employees looking for jobs, and I think it's fair to say that we're now about four million jobs behind for 2008.

There's a bit more good news, though. Most of the folks who were laid off in the first part of the year will soon drop off unemployment rolls, keeping unemployment down to about seven percent. That's good, I suppose, because the unemployment offices in America may not be able to take much more:

Electronic unemployment filing systems have crashed in at least three states in recent days amid an unprecedented crush of thousands of newly jobless Americans seeking benefits, and other states were adjusting their systems to avoid being next.

About 4.5 million Americans are collecting jobless benefits, a 26-year high, so the Web sites and phone systems now commonly used to file for benefits are being tested like never before.

State Unemployment Claim Systems Overwhelmed

(h/t One Fly)

That Reuters article continues:

Underlining the bleak outlook, the Congressional Budget Office said in new forecasts released on Wednesday that it expected the U.S. economy to contract 2.2 percent in 2009 before recovering in 2010 to grow 1.5 percent.

Private Job Losses Mount, Ominous For Payrolls

To misquote Rodney McKay slightly, I'm so glad I got a good education in mathematics, because now I can really appreciate just how screwed we are. That contraction in the economy means there will be net job losses in 2009 as well. The article estimates as many as two million, which means a net loss of at least three million more. Seven million jobs behind in two years, followed by a year of modest growth. People who are out of work had best come up with an inexpensive hobby.

You don't need to be a math genius to add it all up, though. Let's start with those job losses. As both the Reuters article and others have pointed out recently, most unemployment benefits run out after a few months. That means that folks laid off recently probably won't find work before their benefits run out. This means more defaults on things like mortgages and car loans, which means more collections or more debt restructuring and forgiveness. None of that is a good omen for the banking industry, which is already in serious trouble. Nor will it help consumer spending, which has been falling for several months.

Our principal manufacturing industry is in a world of hurt. The most optimistic I can be about their chances is that they'll survive 2009 without going into bankruptcy. None of the American automakers is likely to turn on a dime and start producing more fuel-efficient vehicles this year. Of course, the ailing economy has so depressed oil prices that we might not be all that interested in buying Priuses any time soon.

Thanks to years of neglect, our infrastructure is a mess, particularly in the Northeast, Midwest, and West Coast. We have done a terrible job of educating the next generation of Americans, preferring to obsess about batshit religious dogma and "inclusiveness" than to actually provide our kids with an education.

In all the prosperity of the last few decades, we've neglected to invest in education or infrastructure to anywhere near the level required. We have let our manufacturing base escape overseas. None of these trends is helpful if we want to recover our edge. If we don't change our priorities soon, we'll become a backward country full of religious nutbags and overpaid athletes. Like India a couple of decades ago, we may soon be a place where anyone with enough brains and ambition to make the country a better place will go elsewhere.

Did I ever mention my ongoing depression? Maybe I need to brush up on my French.


Dana Hunter said...

I'd send Mike over here for some schooling, but even a post this good won't get through his head. He's all skull, no brain. Sigh.

Still. It was a damned good post.

Cujo359 said...

Well, merci, mon cher. Folks like Mike seem to assume that all that bad stuff will happen to other people.