Instead of dreaming up theories about some byzantine government conspiracy to manipulate the jobs data for the Obama reelection campaign, it might be easier to take five minutes to read last month’s employment report. Little has changed. The numbers are grim.
The jobs numbers still stink.
The new Bureau of Labor Statistics release is more of the same bad news, not a government conspiracy to tweak one of the last two employment reports to be issued before the November election. The real conspiracy is the PR blitz to convince unemployed Americans that they have a job in their future and retirement security in their golden years if they reject Republican budget proposals.
When the unjustified exuberance in the Obama camp is over, the September jobs numbers will speak for themselves. A drop of only 0.3% in the unemployment rate since April 2012 is an appalling testament to failure and the numbers are likely to change. Did everyone forget that in November 2011 the BLS first reported a 0.4% drop in the unemployment rate that was later revised?
The president insisted in his weekly address that Congress keep the nation moving forward. At the snail’s pace of the Obama jobs recovery, how do we define “moving forward”? The hype about the rescue of American manufacturing would play better if we had continued gains in manufacturing jobs. Despite Labor Secretary Hilda Solis’ boast that “We saw unemployment drop for every group across the board last month.”¹, we lost manufacturing jobs and the sector has been stagnant for the past six months. Not surprisingly, Secretary Solis neglected to use the word “manufacturing” in the press release announcing her department’s newest figures.
582,000 more Americans are now working less than full time because of the economy. The jobs numbers show little change in high unemployment for teenagers, blacks, and Hispanics. How can the Obama campaign keep a straight face touting job creation success when the unemployment rate for blacks is 13.4% and for Hispanics, the president’s favorite ethnic group, 9.9%?²
Worst of all, the number of long-term unemployed remains close to 5 million. With long-term unemployment among older workers a national catastrophe no one wants to talk about (see: Jobless Older Workers are Worthless in the Obama Economy), what happens when these jobless Americans reach retirement age?
Do Democrats understand how the Social Security trust funds work?
Democrats are promising more than jobs. They continue to offer assurances of federal retirement security and golden years lived in health and dignity thanks to Social Security and entitlements that have been the subjects of watchdog agency warnings for years. Nevertheless, Harry Reid sounds positive about the future of Social Security:
Social Security faces long term challenges but, contrary to some claims, it is not in crisis. According to the nonpartisan Congressional Budget Office, it will be fully solvent through 2038 and will be able to pay about 80 percent of the promised benefits after that, which will actually be more than beneficiaries receive today, even if no further congressional action is taken.³
The truth is that we are two years past the 2010 tipping point where Social Security’s outlays became larger than the tax revenue that supports this entitlement.4 There is no good news about the future of guaranteed federal retirement benefits. The Social Security disability trust fund will be exhausted in just four years and the Old-Age and Survivors Insurance Trust Fund by 2038.5 Senator Reid should have added that the two trust funds are treated as one and that if we need to shift funds to the disability trust both funds will be depleted four years earlier, by 2034.6
Will baby boomers be forced to opt for federal retirement security?
In 2004 the Congressional Budget Office cautioned us about what promises of federal retirement security can do:
Furthermore, people’s saving behavior is influenced by their expectations about future benefits. To the extent that baby boomers believe they will receive all of the government benefits to which they would be entitled under current law, that expectation may induce them to work or save less than they would otherwise.7
No one wants to retire on nothing but a Social Security check. Working longer used to be a fallback and the CBO report held out hope that warnings about the long-term viability of federal benefits could induce baby boomers to save more or work longer. That was in 2004.
What happens to those who have had spotty or no employment for years and retirement savings that went to pay the mortgage? Americans are already filing for Social Security at an earlier age or opting for Social Security disability benefits. For older jobless Americans approaching retirement age, a 0.3% drop in the unemployment rate is an irrelevant detail and nothing more.
Democrats appease the jobless with PR spin.
Obama, Reid and company will be long gone before we fully appreciate the damage they have done. 2038 seems like a long time from now. Harry Reid will be nearly 100 years old. If he is still with us, he won’t have to worry about living on Social Security any more than the Republican presidential candidate he has been condemning for his wealth and success. As for the middle class, their jobs and futures are up for grabs. For those still working, this would be a good time to stop listening to campaign pronouncements and start socking away some cash. If there is a government conspiracy afoot, it is the all-out PR campaign to convince Americans of an improving employment outlook and the permanence of federal retirement security.