IT DIDN’T WORK: CRISIS OF CONFIDENCE IN THE OBAMA ECONOMY
“Every day delivers more disappointing news for the millions of Americans struggling in the Obama economy. Consumer spending and manufacturing activity is down, while economic uncertainty is up. Americans deserve better – they deserve a president who has what it takes to get middle-class families back on their feet.” –Amanda Henneberg, Romney Campaign Spokesperson
Last Week, President Obama Claimed His Economic Policies Have “Worked”:
President Obama: “We Tried Our Plan — And It Worked.” OBAMA: “Just like we’ve tried their plan, we tried our plan – and it worked. That’s the difference. That’s the choice in this election. That’s why I’m running for a second term.” (President Barack Obama, Remarks, Oakland, CA, 7/23/12)
But President Obama’s Policies Haven’t “Worked” – Consumer Spending Is Declining And Americans Are Losing Confidence In The Obama Economy:
Consumer Spending Fell In June “For The First Time In Nearly A Year” – Suggesting The Obama Economy “Lost Momentum As It Ended The Second Quarter.” “Spending by American consumers fell in June for the first time in nearly a year when accounting for inflation, suggesting the economy lost momentum as it ended the second quarter. Consumer spending, which makes up about 70 percent of economic activity, fell 0.1 percent when adjusted for rising prices, the Commerce Department said on Tuesday.” (“Inflation-Adjusted Consumer Spending Falls In June,” Reuters, 7/31/12)
Americans’ Confidence In The Economy Has Declined To “Levels Not Seen Since Early January.” “Americans’ confidence in the economy declined last week to -29, matching levels not seen since early January. The decline may be due to the estimate of slower-than-hoped second quarter GDP growth.” (Jenny Marlar, “Economic Confidence Down Last Week, Back To January Levels,” Gallup, 7/31/12)
Americans’ Hope For Future Generations “Reached An All-Time Low” With “Just 14% Of Americans” Expecting Today’s Children To Be Better Off.“Hope for the future generation has reached an all-time low. Just 14% of Americans expect today’s children to be better off than their parents. The latest Rasmussen Reports national telephone survey finds that 65% of American Adults do not expect today’s children to be better off than their parents. Twenty-one percent (21%) are not sure what to expect.” (“New Low: Just 14% Think Today’s Children Will Be Better Off Than Their Parents,” Rasmussen Reports, 7/29/12)
It’s No Surprise Americans Are Losing Faith In The Economy With Millions Of Young Americans Unemployed And Struggling To Make Ends Meet:
The Share Of Americans 18 To 24 Year Olds Who Were Employed Fell To 54% Last Year, The Lowest Since The Labor Department Began Tracking Data In 1948. “The share of American 18- to 24-year-olds who were employed fell to 54 per cent last year, the lowest since the labour department began tracking data in 1948, according to the Pew Research Center. The jobless rate for Americans age 16 to 24 is above 16 per cent, more than twice the national rate.” (Shannon Bond, “Jobless Generation Puts Brakes On US,” Financial Times, 7/30/12)
The Weak Job Market And Record Levels Of Educational Debt Pose A Threat To The Future Earning Power Of Young Americans That Could Have A Long-Lasting Effect On US Growth. “But the problem has a unique flavour in the US, where the weak job market has collided with record levels of educational debt – about $25,000 for the average graduate. Together, they pose a threat to the future earning power of young Americans such as Mr Grzywacz – and could have long-lasting effects on US growth.” (Shannon Bond, “Jobless Generation Puts Brakes On US,” Financial Times, 7/30/12)
“Americans Under 35 Have Lost More Than A Third Of Their Net Worth Since 2001, Compared With A 27 Per Cent Decline For All Ages, According To The Federal Reserve.” (Shannon Bond, “Jobless Generation Puts Brakes On US,” Financial Times, 7/30/12)
“Median Income For Those Under 35 Dropped 10.5 Per Cent From 2007 To 2010 – More Than Any Other Age Group – Compared With A 7.7 Per Cent Overall Decline.” (Shannon Bond, “Jobless Generation Puts Brakes On US,” Financial Times, 7/30/12)
The Median Income Of College Graduates Fell Nearly 10 Percent From 2007 To 2010. “While a university degree still promises a higher income than a high school diploma, the median income of college graduates fell nearly 10 per cent from 2007 to 2010, according to the Fed, compared with a 5 per cent fall for high school graduates.” (Shannon Bond, “Jobless Generation Puts Brakes On US,” Financial Times, 7/30/12)
The Jobless Rate “Doesn’t Tell The Whole Story” – Millions Of Other Americans Are Also Struggling For Work:
“The Overall Jobless Rate, Which Now Stands At 8.2%, Doesn’t Tell The Whole Story.” “But the overall jobless rate, which now stands at 8.2%, doesn’t tell the whole story. For example, the national unemployment rate doesn’t take into account people who want to work but haven’t looked for a job in the previous four weeks because they figured none were available. The national unemployment rate also doesn’t account for people in part-time jobs who would prefer full-time work.”(Neil Shah, “States’ Hidden Jobless Woes,” The Wall Street Journal, 7/30/12)
In Regions Of The Country, Broader Underemployment Can Be As High As Double The Unemployment Rate. “To get a broader view that encompasses both groups, economists at the federal Bureau of Labor Statistics track the under-employment, or U-6, rates for states and the entire country. According to Labor Department figures released late last week, California and Nevada are struggling not just with high unemployment, but also severe under-employment. California’s average unemployment rate from July 2011 through June 2012 was 11.2%, but its broader under-employment rate was far higher, at 20.3%.” (Neil Shah, “States’ Hidden Jobless Woes,” The Wall Street Journal, 7/30/12)
And The Jobs Picture Dimmed Further In July After Regional Manufacturing “Worsened Sharply” Due To “Washington Uncertainty”:
Business Conditions In Texas-Area Manufacturing Worsened Sharply In July. “Business conditions in Texas-area manufacturing worsened sharply this month amid questions about future government policy although production, orders and employment stayed positive, according to a report released Monday by the Federal Reserve Bank of Dallas. The bank said its general business activity index plunged to -13.2 in July from 5.8 in June.” (Kathleen Madigan, “Dallas Fed Survey Hits 10-Month Low, Cites Washington Uncertainty,” The Wall Street Journal, 7/30/12)
“July Is The Weakest Number In 10 Months.” “The bank said its general business activity index plunged to -13.2 in July from 5.8 in June. July’s is the weakest number in 10 months. The company outlook index fell to 1.6 from 5.5. Readings below 0 indicate contraction, and positive numbers indicate expanding activity.”(Kathleen Madigan, “Dallas Fed Survey Hits 10-Month Low, Cites Washington Uncertainty,” The Wall Street Journal, 7/30/12)
The Wall Street Journal Headline: “Dallas Fed Survey Hits 10-Month Low, Cites Washington Uncertainty” (Kathleen Madigan, “Dallas Fed Survey Hits 10-Month Low, Cites Washington Uncertainty,” The Wall Street Journal, 7/30/12)
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