The employment report and the election

Last big uncertainty resolved. Obama’s still ahead.

Today’s employment report was the last wild card in the electoral deck. Substantively, the report was fairly positive: more jobs gained in October than expected, and the August/September numbers revised upward. Politically, it was a mixed bag, with unemployment up a tenth of a percent to 7.9 it was 7.8 on Inauguration Day. The increase was due to people coming back into the labor force.

But Romney didn’t need a mixed bag: he needed a shockingly bad number. His odds on Betfair lengthened to 7/2 (22% chance of winning, which is pretty close to Nate Silver’s current 19%).

Those are still scary numbers, given what a horrible human being Romney turns out to be, what a disgustingly mendacious campaign he’s run, and what a collection of grifters and lunatics the GOP has become. There’s still five days of hard work ahead. Make sure your friends get out and vote.

But right now, despite all the happy h.s. coming out of the Noise Machine, it’s looking pretty good. And it’s hard to see what happens between now and Tuesday to turn it around.

Author: Mark Kleiman

Professor of Public Policy at the NYU Marron Institute for Urban Management and editor of the Journal of Drug Policy Analysis. Teaches about the methods of policy analysis about drug abuse control and crime control policy, working out the implications of two principles: that swift and certain sanctions don't have to be severe to be effective, and that well-designed threats usually don't have to be carried out. Books: Drugs and Drug Policy: What Everyone Needs to Know (with Jonathan Caulkins and Angela Hawken) When Brute Force Fails: How to Have Less Crime and Less Punishment (Princeton, 2009; named one of the "books of the year" by The Economist Against Excess: Drug Policy for Results (Basic, 1993) Marijuana: Costs of Abuse, Costs of Control (Greenwood, 1989) UCLA Homepage Curriculum Vitae Contact: Markarkleiman-at-gmail.com

23 thoughts on “The employment report and the election”

    1. Now, now, he’s promised us he’ll release a second tax return by the end of the year. I’m sure we can trust Mitt Romney to be true to his word, win or lose.

      I’m betting on December 24th.

    1. Pamela D – Mark(especially).

      I agree with Pamela and I wonder why Mark and the Reality Based Community in general is so sanguine about the prospects of a stolen election. Obama won Ohio because he swamped their vote switching – he won’t do that this time. The evidence of various vote rigging/swapping schemes has been building since 2004 when Ohio was stolen from Kerry. Your URL just scratches the surface.

      I am aware of sufficient evidence of vote theft that I expect that any “swing state” that is within 5% will be stolen. I think that the current rush of Republican optimism will be used to cover the surprise results in states like Ohio and Wisconsin (we knew that we were doing better than that effeminate Nate Silver claimed – this proves his extreme bias). Of course, Romney will also point to the magic of his campaigning in the last week or ten days. In Ohio, if totally anomalous results are announced, That’s it – there is no way to check on it. Unfortunately, this will be true in any such state as Republican state governments refuse to look at any evidence.

      Then, of course, we haven’t accounted for the effects of voter suppression – what do you think that might be worth? 0.5%? 1%? We’ll never really know.

      Could I be wrong? I hope that what I’ve written can be treated as the ramblings of a paranoid mind, frightened by the spectre of Romney/Ryan. I sure would like to hear of evidence that invalidates all of the data that have come to light since 2004 for systematic Republican voter fraud.

      Mark?

  1. I think I’d be willing to argue that the number IS shockingly bad, at this point in a nominal “recovery”. Is it quite as bad as the very nadir of the recession? No, by definition, or it wouldn’t be a “recovery”. But, while unemployement isn’t quite as bad as it got during the Great depression, compared to previous recessions it’s terrible.

    It is, in fact, much worse than Obama’s own prediction of where things would be now if there had been no attempt at a stimulus. (Which is worth remembering any time an economist claims he can predict things…)

    At this point even in the Great Depression, economic growth was doing better, for all that unemployment was worse.

    We’re not shrugging this recession off the way we did past ones. Blame it on administration policy, or anything but, it’s absurd to claim the economy is doing well. “Positive”? Only in the sense that even an infinitesimal number can be positive.

    1. Brett,
      We are doing the best of any country in the wealthy world (actually, apparently a couple of tiny countries outside the Eurozone are doing better, but when you’re that small the variation becomes a major obstacle to comparisons).

      And if you persist in your lies about the predictions made in support of the stimulus, I will have to assume that your repeated propagation of frequently debunked talking points defines who and what you are, and ask the front pagers to classify you accordingly.

      1. Ok, explain to me why it is a lie to say that things worked out worse than the administration predicted would happen without the stimulus.

        Mind, why it’s a lie, not unfair, or incomplete, or whatever. What makes it a lie. I assume no such prediction was made?

        1. Are you saying you’ll concede that your argument was “unfair” and/or “incomplete” but not a lie? How is this not trolling?

          1. “Unfair” is a subjective judgement, and “incomplete” is unavoidable, so I’ve no interest in disputing those. It would be like arguing which is tastier, chocolate or vanilla.

            Heck, practically everything Mark posts is both of those things, (No, not chocolate or vanilla.) I try to restrict myself to disputing factual issues. (Try being the operative term here, of course.)

            Now, go back to that first link. Look at the graph on the bottom, comparing job losses in the last 11 recessions. The brute fact is that we have now recovered to a point CONSIDERABLY WORSE THAN THE BOTTOM OF MOST OF THEM. No, 7.9%, or whatever it’s revised up to after the election, is not “good” news. Stick that percent unemployment in any randomly chosen year of the last quarter century. It SUCKS.

            Just eyeballing the graph, I’m estimating that the recession will be finally done with, the economy bounced back to where it was in terms of jobs, at the current rate, IN FOURTY FREAKING YEARS. Compared to the average recession lasting maybe 18 months to two years. IOW, this great recession is on track to last quite a bit longer than the Great Depression, unless something drastically changes.

            That’s what I mean by “shockingly bad”. Anybody care to dispute my reasoning?

          2. As opposed to my math, of course, which is pretty darn terrible; Make that four years, not decades. Making this recession only 4-5 times longer than most recessions, and a bit shorter than the Great Depression. (Don’cha hate it when you spot the dropped decimal AFTER you hit “submit”?)

            But the reasoning still stands. The number isn’t great, it’s further evidence the economy is NOT bouncing back the way it normally would.

        2. Brett,
          I’m feeling unwell today, or I’d put more effort into rounding up links re your absurd repetition of “the stimulus failed because we’re not at 5% unemployment!”. Basically, as you know perfectly well already, the facts are:
          1) Based on then-available statistics and predictions about the situation they were already in, a prediction was made.
          2) It later turned out that even the assessment of the situation they were already in was wildly optimistic – things were far, far worse then they knew. This is because economic data lag by months.
          3) Essentially every economist who’s looked at it reports that the stimulus saved a huge number of jobs (I forget the actual number – a million or a couple million).

          When you lazily repeat these lies about how the stimulus must have failed because things aren’t better, you either display your own persistent ignorance or that you think people reading you are fools. Neither type of behavior should be acceptable.

          1. Sorry to hear of your illness, Warren. Hope you’re feeling better soon.

            There, a prediction was made, it was wrong. No lie, you just think that I’m being unfair in pointing out it was wrong, because you think there were extenuating circumstances.

            Whereas I think there will always turn out to have been extenuating circumstances when prediction fails. What’s the point in excusing bad predictions due to extenuating circumstances, if you have no way of knowing at the time the prediction is made whether they exist? The reason the prediction was worthless doesn’t matter. What matters is that it WAS worthless, and that you don’t know when a prediction isn’t worthless until it’s either turned up right or wrong.

            Your complaint does not address my point, which is that you should be dubious any time an economist claims they can predict the economic future. But, of course, so much of economic policy rests on the presumption that economists CAN predict the future, that the dismal science is a genuine hard science. Perhaps a little more skepticism is in order?

            In the mean time, no comment on my point that recent recessions seem different in kind from previous ones?

      2. I will have to assume that your repeated propagation of frequently debunked talking points defines who and what you are, and ask the front pagers to classify you accordingly.

        Oh noes! Don’t say anything Warren disagrees with or he’ll rat you out to the reality police!

        What do you hope to accomplish by threatening to “ask the front pagers to classify” Brett in some presumably negative way? He’s already demonstrated his willingness to remove himself from the conversation here, do you presume he’s somehow intimidated by an implied threat to attempt to have him removed?

        Here’s a suggestion: If you don’t like Brett’s “repeated propagation of frequently debunked talking points”, and would rather not offer rebuttal, just ignore him! It should be easy enough for a person of reasonable intelligence, since the author of every comment is conveniently posted at the very top of each comment.

        1. I’m suggesting that it should be appropriate to engage in personal abuse against Brett on this site, in violation of the normal commenting rules. Nothing more, and nothing less. Because I think a willingness to repeatedly deceive deserves no better.

    2. it’s absurd to claim the economy is doing well

      I guess it depends on perspective. I agree with you from my perspective, but I hear corporate profits are at record levels. You might not guess that, what with all the whining we hear about Obamacare and other government regulations hampering corporate America’s natural ability to grow the economy, but there it is. Seems like a lot to an ordinary average guy like me, but apparently it’s just below the level where they can afford to let a tiny bit of it trickle-down to you, me, and the unemployed.

      But just because it hasn’t happened yet is no reason to believe that the market won’t work it’s trickle-down magic if only we would do a little more to destroy unions and otherwise tilt the balance further in favor of corporations over citizens, we’re told by Obama’s top competition for the job. I don’t know about you, but I’m having trouble buying it, what with my diminished buying power and all…

      1. No, actually I would guess that, I’m somewhat in the loop where I work, and we’re doing gangbusters. And none of it’s making it’s way back to us employees, because the unemployment rate is so high they don’t have to share it with us to keep us from looking for other employment. That’s what you get when the unemployment rate stays high for a long while, and only as low as it is because of declining labor force participation: An imbalance of negotiating power between labor and capital. Labor isn’t a scarce resource right now, so the price is low.

        We need a much lower unemployment rate to get pay rising again, instead of stagnating while unacknowledged inflation robs it of it’s value.

        1. Your experience mirrors mine. Gangbusters at work but compensation stagnation. Worse actually, was just informed that we’re losing the Friday after Thanksgiving holiday and half the New Year’s Day holiday — yes, they actually expect one-half day of productive work on Jan 1. The only reason I’m not losing even more ground is that I possess hard-to-find abilities necessary for the specialized niche market my current employer serves, having made a lateral move a few years ago from a company that served a broader market where I was losing ground at a much more rapid rate. Supply and demand, ya know.

          We need a much lower unemployment rate to get pay rising again, instead of stagnating while unacknowledged inflation robs it of it’s value.

          I couldn’t agree more. I’m just wondering where the jobs are going to come from, and highly dubious that giving corporations more advantages will help. What motivates companies to hire is a desire to profit more by satisfying more demand. If they can profit more without hiring, they will, every time.

          As the working class shrinks and our compensation stagnates or falls and inflation progresses, the nation’s collective demand for non-essential goods can go nowhere but down. Most of us, by far, work in fields satisfying demand for non-essential goods. A vicious cycle of reduced demand is no recipe for long-term economic success, it’s a recipe for cooking the Golden Goose.

          1. Yeah, thank God I’m a tooling engineer, not one of the production workers. We’re a little harder to replace or do without.

            I personally think there are two factors here.

            The first is automation ratcheting. Automation has become competitive enough with most labor, that while you might not lay people off to automate, if you do lay them off due to a recession, you’re going to automate instead of hiring when production rises again. Each recession is now going to semi-permanently reduce the workforce.

            If you’ll look at that graph comparing past recessions to the present, (In terms of job loss…) two things jump out: This recession may be a lot deeper than the last, but it’s following the same trajectory as the last one, just super-sized. A trajectory rather different from all the previous recessions, where the economy crashed and picked itself back up again in just a couple years. I think that IS due to automation replacing the lost jobs, instead of rehiring.

            The second is the cost of energy. It figures into everything in an industrial economy, it’s the economy’s oxygen. Raise the price of energy relative to other inputs, and it’s like gagging somebody so that they can barely breath. All their efforts will be turned to getting enough energy to not croak, instead of doing productive stuff. The economy is barely getting enough air to breath these days, what with the price of oil.

            Here we’ve got ideology working, IMO, and this is why I have at least some slight hope for Romney: HE certainly isn’t going to hire an energy secretary who openly wants higher energy prices. A lot of people on the left really like energy being expensive, for greenhouse reasons, and to speed the adoption of alternate energy sources which aren’t really all that cheap. If they realize it’s depressing the economy, they consider that an acceptable price to pay.

            I don’t think it is. We need cheap energy, like a marathon runner needs air. The economy is never really going to pick up steam again in any big way so long as the prices stay high.

          2. To put it a different way, I don’t think what we’re going through now is actually a “recovery”, in the classic sense. I don’t think there’s going to BE a “recovery”, in the classic sense. You know, where the economy drops in the first part of the recession, and then bounces back up to where it would have been if there hadn’t been a recession.

            Rather, I think that what has happened is that the economy just suffered a permanent loss, which it will never bounce back from, and has now resumed normal economic growth from a reduced baseline. If you go back to that chart, you can see that the 2001 recession, and to a lesser extent the 1990 recession, followed a different sort of trajectory from previous ones.

            We’re suffering through a series of abrupt economic declines, followed not by recoveries, but merely by a resumption of normal economic growth. It’s a whole new ballgame, this is a different phenomenon than the “recession of years past.

          3. Brett,

            The nit I’d pick here is on the cheap energy argument. First, energy’s apparently cheap enough that corporations can post record profits despite the energy costs involved. It doesn’t seem to be affecting their bottom line in any negative way. Second, the kind of things we often refer to as cheap energy sources, oil for instance, are nothing close to cheap in geological terms. It takes enormous amounts of organic compounds, heat, pressure, and time for the earth to produce oil, and when the easily-extractable reserves are tapped out, that’s going to be the end of cheap oil for a long, long time.

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