Jun 19 2009

Unemployment Skyrocketing In Many States. Obama-Pelosi-Reid Liberal Economic Experiment Failing Miserably

Published by at 10:31 am under Measuring The Recovery

Major Update: California’s unemployment rate jumped to an all time high of 11.5% in May (from 11.1% in April). Do the Democrats really think this pivotal electoral state will stay Dem blue if these conditions continue for the rest of the year? How about Florida, where unemployment shot up 4.4% to a whopping 10.2% unemployment rate? An incredible EIGHT states hit all time unemployment records in May.

The Labor Department says 48 states and the District of Columbia saw employment conditions deteriorate last month.

The eight states that set records are: California, Nevada, North Carolina, Oregon, Rhode Island, South Carolina, Florida and Georgia.

These don’t appear to be green shoots of a economic turn around – end update.

There is good reason to be concerned that the economy is not even close to turning around yet. I found this disturbing chart showing the Oregon and Michigan unemployment for May (which are the two highest in the nation at a shocking 12.4% and 14.1%, respectively). Not only did the levels send  a shiver through me, so did the ‘trajectory’, the path the numbers are on.

They look like a rocket launch. There is no turn around in sight. Even if the descent slowed, it is still climbing- and damn fast. There is another heart wrenching chart here for Michigan, which is clearly has a stagnant work force level as its unemployment rate climbs. Ohio jumped from 10.2% to 10.8% from April to May. New York State rose from 7.7% to 8.2%.  Pennsylvania went from 7.8% to 8.2%. California has not announced yet, but it should be a shocker (given their incredible state budget woes). Florida should also report a large leap given the weekly unemployment claim numbers from the Department of Labor (scroll to the bottom).

Initial claims (newly unemployed) are still at a staggering 608,000 a month. This is down only 1% from the peak job shedding months, so we still have a ways to go. As this article notes, the problem in the unemployment claims numbers is we have been at this so long benefits are running out. So those who began 26+ weeks ago are dropping off the rolls while new claims keep crashing in:

The number of people receiving unemployment aid fell for the first time since early January.

But that doesn’t necessarily mean more companies are hiring. Fewer people are receiving jobless aid largely because more of them have exhausted their standard unemployment benefits, which typically last 26 weeks.

Government figures, in fact, show the proportion of recipients who used up their jobless benefits averaged 49 percent in May, a record.

Just shows how incompletely the government tracks this key economic indicator. Actually, the imprecision allows the liberals to put a fake happy face on a supposed turn around. They keep pointing to the 1% drop in new claims as some miracle. I keep looking at that first chart and I fail to see any substantial deceleration in the problem.

That is the conundrum for the liberal Democrats with their failed economic experiment of trying to use the bloated and lethargic federal government to ‘stimulate’ job creation. They cannot do anything but pretend it is all OK when it is not. The wheels for this human tragedy are grinding slowly onward, and they cannot a damn thing to speed bureaucracy up.

Which comes to the tipping point question: when will America realize the Change they brought into power is actually Hopeless? When will the realization hit America these people cannot help them? It is a question many in the political industrial complex (pols, lobbyists, puppet media outlets) are pondering:

Seventy-two percent.

That’s the number of people in the new NBC/Wall Street Journal pollwho say that President Obama inherited the “current economic conditions” gripping the country as compared to just 14 percent who said the situation was the result mostly of his policies.

The message here is clear. Although people remain deeply pessimistic about the state of the economy — 12 percent are either very or somewhat satisfied while a whopping 89 percent are somewhat or very dissatisfied — they don’t blame Obama for it.


If and when the American public begins to see this as Obama’s economy rather than George W. Bush‘s economy, the data in the NBC/WSJ poll suggests the high-flying president could be in for some more difficult times.

Obama’s decision to use government to grow the economy out of its current rut, a decision that means a significant increase in spending and future deficits has been greeted skeptically by voters, according to the NBC/WSJ data.

We are in the denial stage for voters who supported Obama right now. They had high hopes, and they are clinging to them for as long as possible. Because to admit they were wrong is a very tough and emotional barrier. And the arrogant, lecturing from the also-failed far right only makes transcending the denial better that much tougher.

I for one know the far right is not as ‘right’ as much as they wish. The idea of tax cuts to stimulate job creation, limiting the amount the federal government hinders and bleeds the private sector is important to many. Those are “Duh!” concepts that are supported by a broad range of people from left of center to the right. The right did not invent this – John Kennedy was a great believer in the concept as he proved. Some could argue they poisoned these tried and true concepts with their hate and anger over immigrants and hispanics. Their anger at everyone in the center bled over and tainted even the most obvious truths.

The fact stands, though, that the Obama-Reid-Pelosi stimulus plan enacted back in February is going nowhere. They are not yet spending money to create new jobs (let alone saving them). I have been tracking regarding their job creating efforts, showing the whole sad story.

In the first graph there are 4 sets of columns showing: (from left to right) (1) the amount budgeted for stimulus programs, (2) the amount allocated to specific programs, (3) the amount spent creating jobs and (4) the amount unspent from the total budget. (click image to enlarge)

As everyone can see much of the money has not even been assigned to programs (an arduous but legally required process to make sure programs are valid). The second chart translates the dollar amounts for the last three sets of columns into percentages of the budgeted amounts. (click image to enlarge)

Bottom line: 99% of the job-creating money for these departments/agencies is stuck in the government coffers – doing nothing. Here’s the summary across all 6:

  • $105 billion was budgeted across the organizations to start new programs and create jobs (the largest amounts going  to the Departments of Energy and Transportation)
  • Of that, only $22.7 billion as even been allocated to programs to be spent (21.5%)
  • The total amount spent to date on stimulus programs: $0.350 billion has been spent stimulating the economy. A paltry 0.33%.

Nothing spent. And all this data is from the government sites reporting the progress on recovery programs. It is the government’s own report card on their dismal failure.

Here’s the kicker. Let’s assume the budgeted (allocated) money was actually spent creating jobs over the last four months. This is similarly (but not identical) to how tax cuts of the same magnitude could have worked on our economy since February. If the $22.7 billion dollars went directly to paying unemployed workers at a full time, $100k per year job, that would have employed 681,000 people. That would have also knocked out a complete month of new unemployment claims. 

The liberal economic experiment using the government to stimulate job creation is an utter and complete failure. Obama and the Dems may have inherited a problem, but their answers to the problem were all wrong. And that realization will come to hit the American public as this unemployment debacle runs through out the summer of 2009. It is not a matter of ‘if’, only ‘when’.

12 responses so far

12 Responses to “Unemployment Skyrocketing In Many States. Obama-Pelosi-Reid Liberal Economic Experiment Failing Miserably”

  1. WWS says:

    good graphs – the problem with places like Michigan is that there really is no turnaround strategy for those unemployment rates. The factory jobs aren’t coming back there, no matter what, and businesses are still leaving, not starting. The entire focus of the billions we’re spending on GM and Chrysler is, amazingly enough, NOT intended to create any new jobs – it is simply an attempt to avoid losing those that are left.

    In the long run, a static, backward looking “solution” like that cannot possibly succeed.

    For the best graphs and charts on the situation, I suggest that this link is a “must read”.

    Go to the slideshow to see all of the charts. Will give you a better picture of where we’re headed than anything I’ve seen. It will probably be shocking to many people, but try to construct a rational argument that negates what is there in those charts.


  2. ph2ll says:

    Maybe Republicans can campaign on fiscal sanity as Nat’l Review states:


    It would go a long way to show that America needs grown ups and not wild eyed liberals running the show.

  3. AJStrata says:


    I think if the only things the GOP and conservatives talk about is the pain and suffering of the unemployed, of the failure of the dems to fix the problem, of the proven results of tax cuts after 9-11, etc they can gain the confidence of the people back.

    But they cannot look distracted by whacky theories, they cannot be insulting those who believed in the hope and change, they can not be arrogant know-it-alls. They need to be champions for the people suffering.

  4. kathie says:

    One aspect of a poor economy, the psychology of Obama. It feels that Obama has a distain, and even disgust for those who make money. I’m not talking about just the 1%ters, I’m talking about those of us who can take care of ourselves. He speaks to us as if we were not generous enough, thoughtful enough to take care of the planet (we like bad cars, our footprint is too big, our homes too cold, or too hot), not kind enough to think of a struggling neighbor, not smart enough to embrace his ideas that will save us from ourselves (like government run medical insurance). He calls us out, he berates us, he guilt trips us, he tries to humiliate us, and he punishes us, citizens of America.

    In my humble opinion Americans don’t respond well to being told who we are and what to do. Obama’s psychology is all wrong. He lacks inspiration, he treats us like disobedient children who are defying the omniscient father. My inclination is to hide until it’s over, hang onto what I have, and hope it will be over soon. Not a prescription for growth.

  5. crosspatch says:

    These are the same people what want to spend over a trillion dollars in order to insure only 16 million more people than are already insured today. It would be much cheaper to simply contract to someone like Kaiser Permanente to insure them. Simply pay their premium.

  6. MarkN says:


    You make a good case that the government’s economic numbers can be misleading.

    Let me give you an easy number to remember. The new claims number is the most accurate however it is volatile because of temporary layoffs. So the 4 week moving average number is a more accurate indicator which this past week was about 610,000.

    To use this number to project upon the general conditions of the economy is rough but generally accurate. Any number over 500,000 is a bad recession. Any number over 400,000 would suggest a mild recession. Between 300,000 and 400,000 you have a slow expansion. Under 300,000 and the economy is growing fairly well.

    The one caveat is that even the new claims number is a lagging indicator. However, it has more coincident characteristics than the plain unemployment rate. So for 3 to 6 months the ecomomy can turn in some impressive growth without the new claims number reflecting the improving economy. The unemployment rate can take over a year to turn around.

    Still the 600K number would suggest that the 2nd quarter GDP will be negative again. Just not as negative as the 1st quarter, which the rookies in the WH will proclaim as a great recovery. Positive GDP will be a recovery and a greater than 5% number would be normal after two consecutive quarters of minus 6% GDP performance. A bounce of 5% or more is not hard to achieve. It is like the stock market when a stock is at $5 and goes up $5, then you have a 100% increase. A $5 dollar increase to a $50 stock is only 10%. Because the economy was so low starting the 2nd quarter of 2009, positive growth should be easy. A negative GDP in the 2nd quarter 2009 will be a huge failure.

    If the 2nd quarter 2009 GDP number is negative again, then the 3rd quarter will be even easier to produce a positive number. The lower the economy goes the bigger the % increase will be on any growth. If we can’t put a big number on a lower base then it will show just how anemic the economy really is.

  7. sanjeevn says:

    The fist line of the news item (LAT):
    California’s unemployment rate shot up to its highest level in the post-World War II era.

    Your first line:
    California’s unemployment rate jumped to an all time high of 11.5% in May (from 11.1% in April).


    “Highest level in the post-World War II” is NOT the same as “all time high.”

  8. AJStrata says:


    if you read the AP article it lists the states with records, CA is in that list. If you thought about it, you would realize CA records only go back to the WW II era – and so they are both accurate.


  9. […] From Strata-Sphere.com There is good reason to be concerned that the economy is not even close to turning around yet. I found this disturbing chart showing the Oregon and Michigan unemployment for May (which are the two highest in the nation at a shocking 12.4% and 14.1%, respectively). Not only did the levels send  a shiver through me, so did the ‘trajectory’, the path the numbers are on. […]

  10. Woofguy says:

    Forgetting all the charts and indicators and supposed ‘green shoots’, this economy is tanking. From a general business perspective in California, there is little talk of business increasing for 09, in fact, people in my business line (construction) are really nervous of ’10.

    The people in the squishy middle not paying attention to Obama’s programs, will be in the next two months. Let’s check his approval ratings at that point.

  11. AJStrata says:


    I am an ex-democrat, ex-conservative who has been ringing the alarm bells about Obama’s liberal economic stimulus.

    While the GOP was spend drunk, followed by the liberals, it was a few of us centrists who stayed the course.

    Wake up. Be a pawn or an agent of real progress.

  12. […] of liberalism will be a spectacular failure. Between the failed liberal economic stimulus package – which is not stimulating any new jobs – and the energy tax & trade bill being voted on in the house, we could see an economic […]