John Bolton

John Bolton

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Friday, June 03, 2011

Nothing "Unexpected" About Latest Bad Economic News

Those who warned about the danger of Obama's fiscal and regulatory policies fully expected these bad outcomes!

Increase in unemployment to 9.1% "unexpected?"

Here's how the Wall Street Journal's "Market Watch" put it:
Job growth decelerated sharply in May, the Labor Department said Friday. Total nonfarm payrolls increased by 54,000, much lower than the 125,000 gain expected by Wall Street economists. This is the smallest increase in nonfarm payroll since September. The unemployment rate ticked higher 9.1% in May from 9.0% in the previous month.
The unexpected uptick in bad economic news follows on more news lately. From CNBC:
The last month has been a horror show for the U.S. economy, with economic data falling off a cliff, according to Mike Riddell, a fund manager at M&G Investments in London.
"It seems that almost every bit of data about the health of the US economy has disappointed expectations recently," said Riddell, in a note sent to CNBC on Wednesday.

"US house prices have fallen by more than 5 percent year on year, pending home sales have collapsed and existing home sales disappointed, the trend of improving jobless claims has arrested, first quarter GDP wasn’t revised upwards by the 0.4 percent forecast, durables goods orders shrank, manufacturing surveys from Philadelphia Fed, Richmond Fed and Chicago Fed were all very disappointing."

"And that’s just in the last week and a bit," said Riddell.

Pointing to the dramatic turnaround in the Citigroup "Economic Surprise Index" for the United States, Riddell said the tumble in a matter of months to negative from positive is almost as bad as the situation before the collapse of Lehman Brothers in 2008.
Michael Barone points us to the work of blogger Glenn Reynolds who has tracked the use of the word "unexpected" and it's variants found in news reports about the Obama economy:
"New U.S. claims for unemployment benefits unexpectedly climbed," reported May 25.

"Personal consumption fell," Business Insider reported the same day, "when it was expected to rise."

"Durable goods declined 3.6 percent last month," Reuters reported May 25, "worse than economists' expectations."

"Previously owned home sales unexpectedly fall," headlined Bloomberg News May 19.

"U.S. home construction fell unexpectedly in April," wrote the Wall Street Journal May 18.

Those examples are all from the last two weeks. Reynolds has been linking to similar items since October 2009.
Which raises some questions. As Instapundit reader Gordon Stewart, quoted by Reynolds on May 17, put it, "How many times in a row can something happen unexpectedly before the experts start to, you know, expect it? At some point, shouldn't they be required to state the foundation for their expectations?"

One answer is that many in the mainstream media have been cheerleading for Barack Obama. They and he both naturally hope for a strong economic recovery. After all, Obama can't keep blaming the economic doldrums on George W. Bush forever.
Let's sum this up shall we? Bad economic news ACROSS THE BOARD! And if Bush were President the news would not be "unexpected" but a crisis slapped across the front page of every newspaper in tne country on a daily basis. But because it's Obama, no great urgency for action is demanded!

Obama's policies to blame!

But this is no longer Bush's recession. I imagine most people would love to go back to the Bush years of relatively low unemployment and inflation. Obama is now in his third year in office and he promised that if we did things his way in terms of stimulus and regulatory reform that things would get better. They haven't.

Obama’s chief economist Austan Goolsbee called the latest bad news the “bumps on the road to recovery.” But this road is not leading to recovery, it's leading off the cliff. Readers may recall how last summer was touted by the Obama Administration as "Recovery Summer." It was anything but. Remember when V.P. Joe Biden touted the Stimulus Bill? "In my wildest dreams, I never thought it would work this well," said Biden.

The reason things haven't worked out so well is simple. When Obama took office he insisted that he was going to do things his way. He told Republican leaders who offered alternative suggestions that "I won" and he was going to do it his way.

He enacted a stimulus bill that didn't save jobs but did reward Obama's big government and big union supporters. He pushed a health care bill that made it more expensive for employers to hire new workers. His financial and environmental regulatory "reforms" also made it more difficult for business to hire. His oil moratorium, followed by a deliberate slowdown in new permits for oil work meant the loss of thousands of jobs in that industry. His National Labor Relations Board is trying to prevent a new plant for Boeing aircraft from opening in South Carolina because they want the workers to be unionized.

Obama and the Democrats have rejected nearly every measure put forward by the GOP House to restore sanity to economic policy. Meanwhile, Obama's budget was rejected unanimously in the Senate and no Democrat alternative has come forward to challenge the Ryan Plan. The only plan Obama has put forward recently to deal with economic issues is a demand for more taxes and to once again attack Republicans suggesting the Ryan Plan would cause children and seniors to suffer.

Obama to get "unexpected" news in 2012?

The only question now is whether voters will be sufficiently well informed to see through the billion dollar blizzard of scare tactics and deception that Obama and the Democrats will throw at them in 2012 to obfuscate the appalling disaster that is the Obama record on the economy? While most people pay scant attention to politics, they can't help but notice that things are not going well. And there is only one person and one party to blame!

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