http://www.forbes.com/sites/adamhartung/2014/09/05/obama-outperforms-reagan-on-jobs-growth-and-investing/
The Bureau of Labor Statistics (BLS) today issued America's latest jobs report covering August. And it's a disappointment. The economy created an additional 142,000 jobs last month. After six consecutive months over 200,000, most pundits expected the string to continue, including ADP which just yesterday said 204,000 jobs were created in August.
Even though the plus-200,000 monthly string was broken (unless revised upward at a future date,) unemployment did continue to decline and is now reported at only 6.1%. Jobless claims were just over 300,000; lowest since 2007. Despite the lower than expected August jobs number, America will create about 2.5 million new jobs in 2014. And that is great news.
Back in May, 2013 (15 months ago) the Dow was out of its recession doldrums and hitting new highs. I asked readers if Obama could, economically, be the best modern President? Through discussion of that question, the number one issue raised by readers was whether the stock market was a good economic barometer for judging "best." Many complained that the measure they were watching was jobs – and that too many people were still looking for work.
To put this week's jobs report in economic perspective I reached out to Bob Deitrick, CEO of Polaris Financial Partners and author of Bulls, Bears and the Ballot Box (which I profiled in October, 2012 just before the election) for some explanation. Since then Polaris' investor newsletters have consistently been the best predictor of economic performance. Better than all the major investment houses.
This is the best private sector jobs creation performance in American history
Unemployment Reagan v ObamaBob Deitrick: "President Reagan has long been considered the best modern economic President. So we compared his performance dealing with the oil-induced recession of the 1980s with that of President Obama and his performance during this 'Great Recession.'
"As this unemployment chart shows, President Obama's job creation kept unemployment from peaking at as high a level as President Reagan, and promoted people into the workforce faster than President Reagan.
"President Obama has achieved a 6.1% unemployment rate in his sixth year, fully one year faster than President Reagan did. At this point in his presidency, President Reagan was still struggling with 7.1% unemployment, and he did not reach into the mid-low 6% range for another full year. So, despite today's number, the Obama administration has still done considerably better at job creating and reducing unemployment than did the Reagan administration.
"We forecast unemployment will fall to around 5.4% by summer, 2015. A rate President Reagan was unable to achieve during his two terms."
What about the Labor Participation Rate?
Much has been made about the poor results of the labor participation rate, which has shown more stubborn recalcitrance as this rate remains higher even as jobs have grown.
U3 v U6 1994-2014Deitrick: "The labor participation rate adds in jobless part time workers and those in marginal work situations with those seeking full time work. This is not a "hidden" unemployment. It is a measure tracked since 1900 and called 'U6.' today by the BLS.
"As this chart shows, the difference between reported unemployment and all unemployment – including those on the fringe of the workforce – has remained pretty constant since 1994.
Source: Bureau of Labor Statistics - Databases, Tables and Calculators by Subject
Source: Bureau of Labor Statistics – Databases, Tables and Calculators by Subject
"Labor participation is affected much less by short-term job creation, and much more by long-term demographic trends. As this chart from the BLS shows, as the Baby Boomers entered the workforce and societal acceptance of women working changed, labor participation grew.
"Now that 'Boomers' are retiring we are seeing the percentage of those seeking employment decline. This has nothing to do with job availability, and everything to do with a highly predictable aging demographic.
"What's now clear is that the Obama administration policies have outperformed the Reagan administration policies for job creation and unemployment reduction. Even though Reagan had the benefit of a growing Boomer class to ignite economic growth, while Obama has been forced to deal with a retiring workforce developing special needs. During the eight years preceding Obama there was a net reduction in jobs in America. We now are rapidly moving toward higher, sustainable jobs growth."
Economic growth, including manufacturing, is driving jobs
When President Obama took office America was gripped in an offshoring boom, started years earlier, pushing jobs to the developing world. Manufacturing was declining in America, and plants were closing across the nation.
This week the Institute for Supply Management (ISM) released its manufacturing report, and it surprised nearly everyone. The latest Purchasing Managers Index (PMI) scored 59, two points higher than July and about that much higher than prognosticators expected. This represents 63 straight months of economic expansion, and 25 consecutive months of manufacturing expansion.
New orders were up 3.3 points to 66.7, with 15 consecutive months of improvement and reaching the highest level since April, 2004 – five years prior to Obama becoming President. Not surprisingly, this economic growth provided for 14 consecutive months of improvement in the employment index. Meaning that the "grass roots" economy made its turn for the better just as the DJIA was reaching those highs back in 2013 – demonstrating that index is still the leading indicator for jobs that it has famously always been.
As the last 15 months have proven, jobs and economy are improving, and investors are benefiting
The stock market has converted the long-term growth in jobs and GDP into additional gains for investors. Recently the S&P has crested 2,000 – reaching new all time highs. Gains made by investors earlier in the Obama administration have further grown, helping businesses raise capital and improving the nest eggs of almost all Americans. And laying the foundation for recent, and prolonged job growth.
Investment Returns Reagan v ObamaDeitrick: "While most Americans think they are not involved with the stock market, truthfully they are. Via their 401K, pension plan and employer savings accounts 2/3 of Americans have a clear vested interest in stock performance.
"As this chart shows, over the first 67 months of their presidencies there is a clear "winner" from an investor's viewpoint. A dollar invested when Reagan assumed the presidency would have yielded a staggering 190% return. Such returns were unheard of prior to his leadership.
"However, it is undeniable that President Obama has surpassed the previous president. Investors have gained a remarkable 220% over the last 5.5 years! This level of investor growth is unprecedented by any administration, and has proven quite beneficial for everyone.
"In 2009, with pension funds underfunded and most private retirement accounts savaged by the financial meltdown and Wall Street losses, Boomers and Seniors were resigned to never retiring. The nest egg appeared gone, leaving the 'chickens' to keep working. But now that the coffers have been reloaded increasingly people age 55 – 70 are happily discovering they can quit their old jobs and spend time with family, relax, enjoy hobbies or start new at-home businesses from their laptops or tablets. It is due to a skyrocketing stock market that people can now pursue these dreams and reduce the labor participation rates for 'better pastures."
Where myth meets reality
There is another election in just eight weeks. Statistics will be bandied about. Monthly data points will be hotly contested. There will be a lot of rhetoric by candidates on all sides. But, understanding the prevailing trends is critical. Recognizing that first the economy, then the stock market and now jobs are all trending upward is important – even as all 3 measures will have short-term disappointments.
There are a lot of reasons voters elect a candidate. Jobs and the economy are just one category of factors. But, for those who place a high priority on jobs, economic performance and the markets the data clearly demonstrates which presidential administration has performed best. And shows a very clear trend one can expect to continue into 2015.
Economically, President Obama's administration has outperformed President Reagan's in all commonly watched categories. Simultaneously the current administration has reduced the deficit, which skyrocketed under Reagan. Additionally, Obama has reduced federal employment, which grew under Reagan (especially when including military personnel,) and truly delivered a "smaller government." Additionally, the current administration has kept inflation low, even during extreme international upheaval, failure of foreign economies (Greece) and a dramatic slowdown in the European economy.
Quote from: RecycleMichael on September 08, 2014, 05:01:14 PM
http://www.forbes.com/sites/adamhartung/2014/09/05/obama-outperforms-reagan-on-jobs-growth-and-investing/
The Bureau of Labor Statistics (BLS) today issued America's latest jobs report covering August. And it's a disappointment. The economy created an additional 142,000 jobs last month. After six consecutive months over 200,000, most pundits expected the string to continue, including ADP which just yesterday said 204,000 jobs were created in August.
Even though the plus-200,000 monthly string was broken (unless revised upward at a future date,) unemployment did continue to decline and is now reported at only 6.1%. Jobless claims were just over 300,000; lowest since 2007. Despite the lower than expected August jobs number, America will create about 2.5 million new jobs in 2014. And that is great news.
Back in May, 2013 (15 months ago) the Dow was out of its recession doldrums and hitting new highs. I asked readers if Obama could, economically, be the best modern President? Through discussion of that question, the number one issue raised by readers was whether the stock market was a good economic barometer for judging "best." Many complained that the measure they were watching was jobs – and that too many people were still looking for work.
To put this week's jobs report in economic perspective I reached out to Bob Deitrick, CEO of Polaris Financial Partners and author of Bulls, Bears and the Ballot Box (which I profiled in October, 2012 just before the election) for some explanation. Since then Polaris' investor newsletters have consistently been the best predictor of economic performance. Better than all the major investment houses.
This is the best private sector jobs creation performance in American history
Unemployment Reagan v ObamaBob Deitrick: "President Reagan has long been considered the best modern economic President. So we compared his performance dealing with the oil-induced recession of the 1980s with that of President Obama and his performance during this 'Great Recession.'
"As this unemployment chart shows, President Obama's job creation kept unemployment from peaking at as high a level as President Reagan, and promoted people into the workforce faster than President Reagan.
"President Obama has achieved a 6.1% unemployment rate in his sixth year, fully one year faster than President Reagan did. At this point in his presidency, President Reagan was still struggling with 7.1% unemployment, and he did not reach into the mid-low 6% range for another full year. So, despite today's number, the Obama administration has still done considerably better at job creating and reducing unemployment than did the Reagan administration.
"We forecast unemployment will fall to around 5.4% by summer, 2015. A rate President Reagan was unable to achieve during his two terms."
What about the Labor Participation Rate?
Much has been made about the poor results of the labor participation rate, which has shown more stubborn recalcitrance as this rate remains higher even as jobs have grown.
U3 v U6 1994-2014Deitrick: "The labor participation rate adds in jobless part time workers and those in marginal work situations with those seeking full time work. This is not a "hidden" unemployment. It is a measure tracked since 1900 and called 'U6.' today by the BLS.
"As this chart shows, the difference between reported unemployment and all unemployment – including those on the fringe of the workforce – has remained pretty constant since 1994.
Source: Bureau of Labor Statistics - Databases, Tables and Calculators by Subject
Source: Bureau of Labor Statistics – Databases, Tables and Calculators by Subject
"Labor participation is affected much less by short-term job creation, and much more by long-term demographic trends. As this chart from the BLS shows, as the Baby Boomers entered the workforce and societal acceptance of women working changed, labor participation grew.
"Now that 'Boomers' are retiring we are seeing the percentage of those seeking employment decline. This has nothing to do with job availability, and everything to do with a highly predictable aging demographic.
"What's now clear is that the Obama administration policies have outperformed the Reagan administration policies for job creation and unemployment reduction. Even though Reagan had the benefit of a growing Boomer class to ignite economic growth, while Obama has been forced to deal with a retiring workforce developing special needs. During the eight years preceding Obama there was a net reduction in jobs in America. We now are rapidly moving toward higher, sustainable jobs growth."
Economic growth, including manufacturing, is driving jobs
When President Obama took office America was gripped in an offshoring boom, started years earlier, pushing jobs to the developing world. Manufacturing was declining in America, and plants were closing across the nation.
This week the Institute for Supply Management (ISM) released its manufacturing report, and it surprised nearly everyone. The latest Purchasing Managers Index (PMI) scored 59, two points higher than July and about that much higher than prognosticators expected. This represents 63 straight months of economic expansion, and 25 consecutive months of manufacturing expansion.
New orders were up 3.3 points to 66.7, with 15 consecutive months of improvement and reaching the highest level since April, 2004 – five years prior to Obama becoming President. Not surprisingly, this economic growth provided for 14 consecutive months of improvement in the employment index. Meaning that the "grass roots" economy made its turn for the better just as the DJIA was reaching those highs back in 2013 – demonstrating that index is still the leading indicator for jobs that it has famously always been.
As the last 15 months have proven, jobs and economy are improving, and investors are benefiting
The stock market has converted the long-term growth in jobs and GDP into additional gains for investors. Recently the S&P has crested 2,000 – reaching new all time highs. Gains made by investors earlier in the Obama administration have further grown, helping businesses raise capital and improving the nest eggs of almost all Americans. And laying the foundation for recent, and prolonged job growth.
Investment Returns Reagan v ObamaDeitrick: "While most Americans think they are not involved with the stock market, truthfully they are. Via their 401K, pension plan and employer savings accounts 2/3 of Americans have a clear vested interest in stock performance.
"As this chart shows, over the first 67 months of their presidencies there is a clear "winner" from an investor's viewpoint. A dollar invested when Reagan assumed the presidency would have yielded a staggering 190% return. Such returns were unheard of prior to his leadership.
"However, it is undeniable that President Obama has surpassed the previous president. Investors have gained a remarkable 220% over the last 5.5 years! This level of investor growth is unprecedented by any administration, and has proven quite beneficial for everyone.
"In 2009, with pension funds underfunded and most private retirement accounts savaged by the financial meltdown and Wall Street losses, Boomers and Seniors were resigned to never retiring. The nest egg appeared gone, leaving the 'chickens' to keep working. But now that the coffers have been reloaded increasingly people age 55 – 70 are happily discovering they can quit their old jobs and spend time with family, relax, enjoy hobbies or start new at-home businesses from their laptops or tablets. It is due to a skyrocketing stock market that people can now pursue these dreams and reduce the labor participation rates for 'better pastures."
Where myth meets reality
There is another election in just eight weeks. Statistics will be bandied about. Monthly data points will be hotly contested. There will be a lot of rhetoric by candidates on all sides. But, understanding the prevailing trends is critical. Recognizing that first the economy, then the stock market and now jobs are all trending upward is important – even as all 3 measures will have short-term disappointments.
There are a lot of reasons voters elect a candidate. Jobs and the economy are just one category of factors. But, for those who place a high priority on jobs, economic performance and the markets the data clearly demonstrates which presidential administration has performed best. And shows a very clear trend one can expect to continue into 2015.
Economically, President Obama's administration has outperformed President Reagan's in all commonly watched categories. Simultaneously the current administration has reduced the deficit, which skyrocketed under Reagan. Additionally, Obama has reduced federal employment, which grew under Reagan (especially when including military personnel,) and truly delivered a "smaller government." Additionally, the current administration has kept inflation low, even during extreme international upheaval, failure of foreign economies (Greece) and a dramatic slowdown in the European economy.
Curly, Moe and Larry will just grumble and moan that Forbes is 'librul rag'...wait...what?
The only difference is that Reagan was very successful in making policy and getting it passed through Congress. He actually worked well with Democrats and did some great bi-partisan work.
Obama had a sympathetic congress for his first two years and the policies he was able to enact were less than economically popular. He has never had any ability to work across party lines because all he is equipped to do is make decree, demand and threat. :D
So, basically this shows that an Obama incapable of getting his polices passed is equal to a Reagan successful in getting his party's policies passed.
Funny to watch the Dems grumble about not being able to get any thing done, then stand up and say "look what we did!"
It seems that liberal policy works very well when it fails to pass.
Oh good grief. Obama>Reagan.
Love the part about deficit reduction...
So funny to read gaspar and guido try and explain this. Your non-stop criticisms of Obama and the economy sure sound hollow now.
Shall we go to the way back machine and show your follies?
Here's where I get confused on the state of Obamanomics:
In light of this high employment participation rate, more Americans than ever are on food stamps:
QuoteOdd Trends: More Americans Remain on Food Stamps, Post-Recession
In the four years following the end of the downturn in 2009, the number of SNAP recipients increased by 7.3 million. Moreover, the percentage of the population receiving food stamps increased from 13 percent to 15 percent. To give perspective on this number, we can compare the recent recovery with the recovery after the recession of the 1980's, whose duration and unemployment levels are most comparable. Adjusting for population, in the four years following the 1981-82 recession, there was a 12.5 percent decline in food stamp recipients. In the four years following the 2007-09 recession, SNAP recipients increased by 15.6 percent. Were this recent recovery to have behaved similarly to that of the 1980's, by 2013 only 11.5 percent of the population would have been receiving SNAP benefits: 36 million individuals as opposed to 47.6 million. That is not a small difference.
By itself, SNAP benefits may not be enough to reduce the incentive for a recipient to go to work, or to move from part-time to full-time regular employment, but when combined with unreported earnings or other assistance programs -- perhaps most notably unemployment insurance benefits – the program does appear to allow a significant number of adult recipients to remain out of work longer than they might otherwise. Without some effort to require these SNAP recipients to participate in employment programs such as those offered under TANF, I fear that the number of non-working, nonelderly, nondisabled SNAP recipients will remain high.
http://townhall.com/tipsheet/kevinglass/2014/08/03/odd-trends-more-americans-remain-on-food-stamps-postrecession-n1874227
And Obama requested increases in welfare expenditures in his FY 2015 budget proposal.
QuoteThe Obama administration's proposed budget, released to Congress Tuesday, includes increased spending on education and welfare.
President Barack Obama unveiled his 2015 budget proposal Tuesday, calling for increased spending on welfare with increases in education and research paid for by closing tax loopholes for the wealthy ahead of heated midterm elections.
http://www.usnews.com/news/articles/2014/03/04/obama-budget-boosts-welfare-spending-ahead-of-election
You'd think with all this new-found job prosperity, we'd be spending less on welfare programs, or maybe that's not how things work any more. I must be some sort of anachronism.
(http://i.ytimg.com/vi/brC8vzd2QkE/0.jpg)
Quote from: RecycleMichael on September 08, 2014, 07:25:12 PM
So funny to read gaspar and guido try and explain this. Your non-stop criticisms of Obama and the economy sure sound hollow now.
Shall we go to the way back machine and show your follies?
It's really quite simple.
When success happens under our guy's watch, it's all his doing. When it happens under your guy's watch, he didn't have a thing to do with it.
When the smile hits the fan, our guy had nothing to do with it. When it's your guy, his fingerprints are all over it.
Capisce?
Quote from: RecycleMichael on September 08, 2014, 07:25:12 PM
So funny to read gaspar and guido try and explain this. Your non-stop criticisms of Obama and the economy sure sound hollow now.
Shall we go to the way back machine and show your follies?
Explain what? That Obama is a better jobs creator than Reagan? Obama's deficit reduction is better than Reagan? I am just laughing about it.
Glad you can laugh. I am laughing too, probably just for a slightly different reason.
Quote from: Gaspar on September 08, 2014, 06:53:03 PM
The only difference is that Reagan was very successful in making policy and getting it passed through Congress. He actually worked well with Democrats and did some great bi-partisan work.
Obama had a sympathetic congress for his first two years and the policies he was able to enact were less than economically popular. He has never had any ability to work across party lines because all he is equipped to do is make decree, demand and threat. :D
So, basically this shows that an Obama incapable of getting his polices passed is equal to a Reagan successful in getting his party's policies passed.
Funny to watch the Dems grumble about not being able to get any thing done, then stand up and say "look what we did!"
It seems that liberal policy works very well when it fails to pass.
If you count two of the largest tax increases in the history of the world as successful.
And grant amnesty to millions of illegal aliens as successful.
And commit massive criminal activity with all the Iran/Contra issue (the policy part - supplying Iran with weapons). Wildly successful. You remember that - the one that our Great American Hero Oliver North was anointed after being convicted. Twice.
Just think how much better off we could be if there were a real Congress in place that would do it's job!
Quote from: guido911 on September 08, 2014, 07:20:02 PM
Love the part about deficit reduction...
Reality is a real b$tch, ain't it... gotta really sting!
Quote from: Conan71 on September 08, 2014, 07:31:03 PM
Here's where I get confused on the state of Obamanomics:
In light of this high employment participation rate, more Americans than ever are on food stamps:
Must be nice not to have felt the effects that the other 98% feel...employment growing at better than Reagan rates, but wages actually decreasing. Consider yourself 'special'....
All we need now is a decent increase in minimum wage to make the whole thing work even better - as it always has in the past, regardless of the mindless pablum the Hannity/Limbaugh/O'Reilly/Drudge feed you....
Quote from: heironymouspasparagus on September 08, 2014, 10:12:20 PM
Must be nice not to have felt the effects that the other 98% feel...employment growing at better than Reagan rates, but wages actually decreasing.
Take him to the wood shed, RM. He's off the reservation.
You heard it here first: "Wages decreasing under Obama".
What happened to Obama's promises that under his watch the middle class was going to rally and take America back? As of labor day, crazy Uncle Joe was saying it's time for the middle class to take back America. I thought they did that when they elected Obama ???
Quote from: Conan71 on September 08, 2014, 10:18:07 PM
Take him to the wood shed, RM. He's off the reservation.
You heard it here first: "Wages decreasing under Obama".
What happened to Obama's promises that under his watch the middle class was going to rally and take America back? As of labor day, crazy Uncle Joe was saying it's time for the middle class to take back America. I thought they did that when they elected Obama ???
You cannot possibly be that obtuse - I have been saying for a long, long time that wages have been decreasing for 40+ years. Hence the comparison that shows the minimum wage decreasing by more than 30% in real terms since 1968. Dissemination. Deflection. The Script. Still need a lot of 'recovering'....
A period of time - 46 years - where we have had Republicans for well over half the time. 28 years versus about 18 so far of Democrats.
And you do remember that chart a few months ago showing how the economy in general always does better with Democrats in office - for about the last 75 + years. That's gotta sting, too....
As for taking back America, well that's a nice dream and an ideal to be pursued, but made doubly difficult by the fact that corporate America has bought and paid for Congress. If we could figure out a way to get to the point where money was not the same as "free speech", there might even be a chance. Well, except in Oklahoma - we gotta have our Inhofe's....
Quote from: heironymouspasparagus on September 08, 2014, 10:36:54 PM
You cannot possibly be that obtuse - I have been saying for a long, long time that wages have been decreasing for 40+ years. Hence the comparison that shows the minimum wage decreasing by more than 30% in real terms since 1968. Dissemination. Deflection. The Script. Still need a lot of 'recovering'....
A period of time - 46 years - where we have had Republicans for well over half the time. 28 years versus about 18 so far of Democrats.
And you do remember that chart a few months ago showing how the economy in general always does better with Democrats in office - for about the last 75 + years. That's gotta sting, too....
As for taking back America, well that's a nice dream and an ideal to be pursued, but made doubly difficult by the fact that corporate America has bought and paid for Congress. If we could figure out a way to get to the point where money was not the same as "free speech", there might even be a chance. Well, except in Oklahoma - we gotta have our Inhofe's....
What did you call me?
(http://content7.flixster.com/question/54/60/51/5460513_std.jpg)
Anyone else smell asparagus farts?
Quote from: Conan71 on September 09, 2014, 09:01:20 AM
What did you call me?
I called you - "greater than 90 but less than 180 degrees..."
RM, I'll see your op-ed and raise you one:
QuoteReagan vs. Obama: These 5 Charts Prove Who Was the Better President
As can be expected, because of the drop of the unemployment rate to 7.8%, comparisons of Obama's "recovery" and the Reagan recovery have been making the rounds.
1. Unemployment Rates are Alike
(http://static.ijreview.com/wp-content/uploads/2014/01/1001512reaganobama.jpg?10ae6a)
But the reasons behind the drop in unemployment rates are disguised by the above chart.
The chart below shows exactly why the unemployment rate drops: those not in the labor force are at a record 91.8 million.
2. Unemployment Rate Drops as People Leave Workforce
LFP Participation
(http://static.ijreview.com/wp-content/uploads/2014/01/LFP-Participation1.jpg?10ae6a)
Reagan's "recovery" came from an expanding labor market, and not from a shrinking one.
Reagan's economy created 15.8 million new jobs, but Obama's has only produced 3.2 million over five years. And... fewer people are working now than six years ago.
3. 1,687,000 Fewer People Working Than Six Years Ago
FEWER PEOPLE EMPLOYED TODAY THAN SIX YEARS AGO-CHART
(http://static.ijreview.com/wp-content/uploads/2014/01/FEWER-PEOPLE-EMPLOYED-TODAY-THAN-SIX-YEARS-AGO-CHART.jpg?10ae6a)
Wait, it gets worse. Reagan-bashers accuse of him of worsening income inequality, which would be the case if we ignore that all income levels rose under Reagan.
These same critics let Obama off the hook for actually worsening income inequality: while the top 1% has made 95% of the income gains, the middle class has been decimated.
4. Income Inequality Worse Under Obama Than Reagan
Historical-US-Income-Inequality-Current-Dollars (2)
(http://static.ijreview.com/wp-content/uploads/2014/01/Historical-US-Income-Inequality-Current-Dollars-2.jpg?10ae6a)
No wonder the American people tended to love Reagan, while Obama is falling out of favor.
5. Obama's Approval Abysmal Compared to Reagan's
(http://static.ijreview.com/wp-content/uploads/2014/01/obama.trend_.jpg?10ae6a)
http://www.ijreview.com/2014/01/109489-reagan-vs-obama-7-charts-prove-real-recovery/#PrettyPhoto[109489]/4/
Your graphs are all four years old.
Your are comparing their first four years and not the last years of their presidencies.
Nice try though.
Quote from: RecycleMichael on September 09, 2014, 11:49:19 AM
Your graphs are all four years old.
Your are comparing their first four years and not the last years of their presidencies.
Nice try though.
Not correct. Labor participation charts were annual figures through 2013. Income inequality was put out by the Census Bureau after 2011. Are you betting it's improved?
Let's see how this year ends for Obama.
Does anyone else find it a bit odd that in a post (and indeed in the linked article) focused on jobs performance, the number of jobs created in the subject years was not discussed or even mentioned?
The numbers are interesting, to say the least:
Obama administration through August of year 6: 4,344,000 jobs added.
Reagan administration through August of year 6: 8,644,000 jobs added.
http://data.bls.gov/pdq/SurveyOutputServlet
Average annual increase in number of jobs:
Reagan 1st term: 1.43%
Reagan 2nd term: 2.69%
Obama 1st term: 0.28%
Obama 2nd term (to date): 1.8%
Quote from: Oil Capital on September 09, 2014, 01:16:35 PM
Does anyone else find it a bit odd that in a post (and indeed in the linked article) focused on jobs performance, the number of jobs created in the subject years was not discussed or even mentioned?
The numbers are interesting, to say the least:
Obama administration through August of year 6: 4,344,000 jobs added.
Reagan administration through August of year 6: 8,644,000 jobs added.
http://data.bls.gov/pdq/SurveyOutputServlet
Average annual increase in number of jobs:
Reagan 1st term: 1.43%
Reagan 2nd term: 2.69%
Obama 1st term: 0.28%
Obama 2nd term (to date): 1.8%
In President Obama's defense, his stimulus, cash for clunkers, numerous green energy scams, and blind passage of the Affordable Care act were pretty devastating on his jobs numbers. Now that he can't push any more of his policies through congress, I expect his the jobs numbers to continue to improve slowly. He can't wreck the car if he's not allowed to drive.
He does his best work on the golf course anyway, it's just expensive for us to keep him there.
(http://farm4.staticflickr.com/3844/15191674085_c100077e59.jpg)
Quote from: RecycleMichael on September 08, 2014, 05:01:14 PM
http://www.forbes.com/sites/adamhartung/2014/09/05/obama-outperforms-reagan-on-jobs-growth-and-investing/
The other glaring omission in this article is there is ZERO credit given to Bill Clinton for 22 million new jobs created during his tenure. THAT was the largest job growth under any administration, not Reagan as was posited by Hartung or one of the experts he quoted.
Hartung gets categorically beat down:
QuoteEconomic Growth: Obama Vs. Reagan
Last week, Adam Hartung qualified for the "Mark Twain Award" if there was such a thing. In his article, "Obama Outperforms Reagan On Jobs, Growth & Investing," Adam goes to some length to try and show that unemployment rate, the S&P 500 and economic growth are currently better under the current administration than they were during the Reagan administration.
Adam's first mistake was in the use of the Bureau Of Labor Statistics measure of unemployment (U3) as a comparative benchmark of success as President. To wit:
""President Obama has achieved a 6.1% unemployment rate in his 6th year, fully one year faster than President Reagan did. At this point in his presidency, President Reagan was still struggling with 7.1% unemployment, and he did not reach into the mid-low 6% range for another full year. So, despite today's number, the Obama administration has still done considerably better at job creating and reducing unemployment than did the Reagan administration."
While this is "technically true," it falls within Twain's category of a "statistical lie."
The BLS's measure of unemployment has become obfuscated by the rise in the number of individuals that are no longer counted as part of the labor force. As I discussed in "Why The Unemployment Rate Is Irrelevant," the measure of labor force participation is markedly different between Reagan and Obama.
During Reagan's Presidency, workers that were unemployed longer than 52-weeks were still part of the labor force. This inclusion gave a more accurate measure of the relative size of the labor force overall. However, in 1994, Clinton removed individuals from the labor force that were currently unemployed for longer than 52-weeks. This adjustment immediately improved the overall measure of unemployment by shrinking the labor force by some 500,000 individuals. Since then, the number of individuals no longer counted as part of the labor force has swelled to more than 92 million individuals, or roughly 45% of the working age population (16-54) as of the end of 2013
In other words, a large part of the drop in the U-3 unemployment rate is due to the increase in the number of individuals excluded from the workforce. In theory, if the dropout rate continued at the current pace, the unemployment could fall towards zero allowing the Federal Reserve to win the battle of unemployment, but losing the war of economic prosperity.
The chart below shows the annual change in those not counted as part of the labor force by President from 1981-Present.
(http://c3352932.r32.cf0.rackcdn.com/content/picc09fdd8bc272b3e8d8ac24170aa374bd.PNG)
One of the arguments made by Adam is that the slack in the Labor Force Participation Rate is due to "Baby Boomers" retiring. This is hardly the case as I discussed in "Don't Blame Boomers For Not Retiring:"
"Recent statistics show that the average American is woefully unprepared for retirement. On average, 40% of American families are NOT saving for retirement, and of those who are, it is primarily about one year's worth of income. Furthermore, important to this particular conversation, one-fourth of those at retirement age postponed retirement with only 18% being confident of having enough saved for retirement.
With 24% of "baby boomers" postponing retirement, due to an inability to retire, it is not surprising that the employment level of individuals OVER the age of 65, as a percent of the working age population 16 and over, has risen sharply in recent years."
(http://c3352932.r32.cf0.rackcdn.com/content/pic1a26b3b9132c80b57f3e1f5731ab1151.PNG)
This also explains that while the unemployment RATE has fallen to levels more commonly associated with full-employment, the actual levels of full-time employment have not risen. Critically, in an economy that is nearly 70% driven by consumption, it is ONLY full-time employment that leads to increasing levels of consumption, household formation and ultimately economic growth.
However, for the sake of argument, let's exclude all individuals OVER THE AGE OF 54 from the analysis so we can focus on those of working age 16-54. If the employment has indeed improved better under the Obama Administration then the level of full-time employment for the working age population should have improved markedly.
(http://c3352932.r32.cf0.rackcdn.com/content/picb8779fe1f92f50a4aa8752f3db5e1285.PNG)
Unfortunately, that is not the case. At the end of Reagan's administration full-time employment relative to the working age population was at 51.98% versus 47.78% for Obama currently. However, following the recession in 1981, full-time employment under Reagan surged sharply as the real economy gained traction. This has not been the case as full-time employment has remained primarily a function of population growth and little else.
Adam also makes another critical mistake in his analysis using the stock market as a measure of economic performance. To wit:
""However, it is undeniable that President Obama has surpassed the previous president. Investors have gained a remarkable 220% over the last 5.5 years! This level of investor growth is unprecedented by any administration, and has proven quite beneficial for everyone."
Again, it is a true statement but a "statistical fallacy."
The surge in the stock market since 2009 has not been a representation of underlying economic strength but rather a direct correlation to the expansion of the Federal Reserve's balance sheet. The chart below shows the level of excess reserves of depository institutions and the S&P 500 index by President.
(http://c3352932.r32.cf0.rackcdn.com/content/pic3482df7f21c58961cce81c029f795397.PNG)
As you will notice, the surge in excess bank reserves beginning in 2009 has correlated with the surge in asset prices that is a benefit that the Reagan did not have. Therefore, to judge which President had better stock market performance we must extract the effect of the Federal Reserve interventions. The next chart shows, by President, the ratio of the S&P 500 Index divided by excess reserves at depository institutions.
(http://c3352932.r32.cf0.rackcdn.com/content/picfb828e377a9fd3c5dede08448e524def.PNG)
During the Reagan administration the stock market was growing at a rate faster than excess reserves which was a reflection of actual economic strength. Since 2009, growth of the stock market has only been a function of monetary interventions rather than broad-based economic prosperity.
Lastly, there is one point that must be considered. If we are truly going to compare President Obama to Ronald Reagan, it should be on the basis of a level playing field. As shown in the chart below, President Reagan's achieved real, inflation-adjusted, economic growth of 3.88% annually on average as compared to 2.04% under President Obama.
(http://c3352932.r32.cf0.rackcdn.com/content/pic211e34482925ba6cabffb98a2227205f.PNG)
This outperformance was achieved despite headwinds of an average interest rate nearly 5-times that of the current administration and an inflation rate that was more than double.
When considering that President Obama has been able to achieve real economic growth of just 2.04% annually despite historically low levels of inflation and interest rates combined with massive government interventions and balance sheet expansions; it makes his overall performance even more disappointing.
However, I do agree with Adam on his concluding point:
"There are a lot of reasons voters elect a candidate. Jobs and the economy are just one category of factors. But, for those who place a high priority on jobs, economic performance and the markets the data clearly demonstrates which presidential administration has performed best."
Clearly, the right answer was Reagan. Reagan, faced with skyrocketing inflation and interest rates, laid the groundwork that paved the way for a 20-year expansion of economic growth and prosperity. Unfortunately, as we move into the fifth longest economic recovery in history, there is little evidence such an economic "boom" is on the horizon.
http://www.investing.com/analysis/economic-growth:-obama-vs.-reagan-225151