Tuesday, November 8, 2011
9% Unemployment is Still Terrible
The news came out on Friday that the national unemployment rate is down to 9%. The Drive-By Media is going to tell you that this is a win for President Obama. I'm here to be your reality check and tell you it's not a win for Obama. It's a joke to say that this is a win for Obama, based on the President's own standard.
Remember when the Stimulus was passed? Nearly three years after Obama's Stimulus Package was passed, we're still at a full percentage point higher than the President promised we would go past if we did pass the Stimulus. So, to put it simply: Promise: Unemployment below 8%. Reality: Two years later, we're celebrating 9%, and remember, it was as high as 10.9% at one point.
Now I know what the two or three liberals who end up reading this will tell me: It would've been so much worse. It's a favorite line of liberals, because of course their claim can't be proven so they can trumpet it like it's their job. Actually, there are many historical examples of worse recessions that we were able to get out of much faster with zero government stimulus.
In 1920 we saw a depression (not just a recession, a depression) where unemployment jumped from 4% to 12%. President Warren G. Harding's reaction? Cut government spending in half then slash tax rates on all income brackets, in the process reducing the national debt by one-third. The Federal Reserve did just as little. By 1921 a full blown recovery commenced. By 1922, unemployment was down to 6.7% and by 1933 it was 2.4%. (2)
According to historian and economist Thomas Woods,
The federal government did not do what Keynesian economists ever since have urged it to do: run unbalanced budgets and prime the pump through increased expenditures. Rather, there prevailed the old-fashioned view that government should keep taxation and spending low and reduce the public debt. (2)
Yet today, we've got 9% unemployment, which is an increase from pre-Stimulus levels and higher than the promised "not above 8%" that the Democrats hawked before the bill, yet Nancy Pelosi is telling us that, without the stimulus, unemployment would've gone up to 15%. (3) Nothing in history backs this claim. We might as well make our own claims too. So here goes nothing. If I hadn't had a ham sandwich for lunch this past Friday, the Earth would've been sucked into the Sun. It makes absolutely the same amount of sense as Pelosi's claim.
Aside from using a level of logic that hasn't been so illogical since the invention of the Biathalon (seriously...skiing plus shooting a gun...who thought of THAT?), this is not a win for Obama. Based on his claims, we never should've seen 9% unemployment to begin with. If Obama hadn't played his Keynesian games that have yet to work in the history of the world, we'd be out of this recession. So no, this isn't a win for Obama. This is a loss for Obama. End of story.
(1) U.S. unemployment rate falls to 9%
(2) The Forgotten Depression of 1920
(3) Pelosi: Without Obama's Stimulus, Unemployment Would Now Be 15%