Thursday, August 27, 2009

The Obama Economy

Atlanta Fed Chief Dennis Lockhart says that if the national unemployment rate were figured by the old rules - including those who are underemployed and those who have stopped looking for work - that rather than the outrageous 9.4% rate touted by the Obama administration, the real rate of unemployment is approximately 16%.

Lockhart, whose knowledge of economics is more advanced than the guesswork indulged in by the Obama administration, says that public spending will not solve the unemployment problem. He additionally forecasts a protracted period of recession typified by perennial joblessness, and calls fears about excessive government spending leading to high deficits and inflation "warranted."

Economist John Williams of estimates that, when all data is taken into consideration, the real unemployment rate is teetering on the brink of The Great Depression's 25%. In an article at U.S. News & World Report, Williams is quoted:

So if you care not just about people who meet the official definition of "unemployed" but also about people who are dropping out of the labor force, 2009 seems to be trailing 1982 in terms of the health of the labor market. Williams says that when he takes into consideration people who haven't looked for work in more than a year because they can't find jobs, the real unemployment rate today goes all the way up to 20.6 percent by his calculations. "It won't take much to get it to the worst since the Great Depression," he says.
Whether you go with the Atlanta Fed's number of 16% or John Williams' number approaching 21%, it is plain that Obama will indeed go down in history...

... with Hoover.

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