OpEdNews Op Eds

Government Labor Statistics: Lies and Damned Lies

By (about the author)     Permalink       (Page 1 of 1 pages)
Related Topic(s): ; ; , Add Tags Add to My Group(s)

View Ratings | Rate It

opednews.com Headlined to H3 2/4/10

Become a Fan
  (63 fans)

By Dave Lindorff

For months, the various government departments dealing with things economic--Treasury, Commerce, Labor and of course the Council of Economic Advisers and the Federal Reserve, have been issuing soothing words that the nation's economy is headed back up from the Great Recession that allegedly began in December 2007.

But now comes word from the Department of Labor that, whoops, we minsunderestimated, as former President George W. Bush would say, the number of jobs lost. The Department of Labor's Bureau of Labor Statistics is reporting that because of a "modeling error," it misstated the number of jobs lost between March 2008 and March 2009 by 17%. In hard numbers, that is to say, the BLS was reporting that a record 4.8 million jobs were lost during those 12 months of economic collapse, when in fact the job loss total was actually 5.6 million.

They missed 824,000 lost jobs! Just to give you an idea of how many people that is, we're talking about 10% of the population of the city of New York, and more people than the entire population of San Francisco.

And it gets worse. The same broken model was used for the next year, so that while we've been getting all those soothing words about how job losses are slowing, and about how the economy is going to start coming back, in fact, the number of jobs supposedly created or added during the past nine months has actually been overstated by almost one million! That would be the entire population of the cities of Seattle and Miami combined.

Technically, what happened is that the BLS was relying on an assumption that new businesses were forming all during these two periods, and that these new businesses were hiring people. That's what happens during normal years, of course. But of course, any dunce without out an economics PhD could have told the BLS that over the past two years, which were hardly normal in any sense of the word, not many new businesses were being formed.

As Dean Baker, an economist with a PhD who is co-director of the Center for Economic Policy and Research, and a guy who, as a left-leaning economist outside of the mainstream concensus does exercise common sense, puts it, when all those rosy numbers about job creation or slowing job losses were coming out, "the idea that we had a significant number of businesses being created didn't make sense."

Ah, but that begs the question: if the government numbers are that grotesquely wrong, what does that say about the government's policy with regard to joblessness, about it's policy towards economic stimulus, about the government's policy towards alleviating the suffering of the struggling citizenry? After all, policies are supposed to be designed around a solid set of facts.

It would seem that a major reappraisal of economic policy would be in order, no?

But not a word are we hearing about such a reappraisal.

In fact, I suspect that after this little moment of embarrassment, the whole thing will be forgotten, and we'll go on with our laissez faire approach to dealing with this recession, pretending that things will all get better on their own.

This shouldn't surprise anyone. After all, we're still hearing, day in, day out, on the news that the unemployment rate is only10 percent, when the economists all know that this is a fiction. Thanks to political pressures dating back to the Reagan administration, and continued through the Clinton and Bush years, that figure has carefully excluded people who have been jobless for over a year, people who say to Labor Department pollsters that they have "given up" looking for work, and people who are working at a part-time job because they can no longer find full-time employment. By any fair standard, all these people are unemployed too, but we just erase them from the books. If we counted all these people, as the Labor Department used to do back in the 1970s and earlier, the real unemployment rate would be over 18 percent today in America.

The bogus figure of 10 percent unemployment gives the false impression that unemployment in the US is not all that bad. It also gives the impression that it's not any worse here than in Europe, where the rate is also about 10 percent,except that Europe, the long-term unemployed are counted, as are those who are only working part-time involuntarily.

The lesson here is not to trust the government. When it comes to the nation's true economic condition, as the old saying goes: "Who are you going to believe: the numbers or your own lying eyes?"
__________________
DAVE LINDORFF is a Philadelphia-area journalist. His latest book is "The Case for Impeachment" (St. Martin's Press, 2006). His work is available at www.thiscantbehappening.net


 

Dave Lindorff is a founding member of the collectively-owned, journalist-run online newspaper www.thiscantbehappening.net. He is a columnist for Counterpunch, is author of several recent books ("This Can't Be Happening! Resisting the (more...)
 

Share on Google Plus Submit to Twitter Add this Page to Facebook! Share on LinkedIn Pin It! Add this Page to Fark! Submit to Reddit Submit to Stumble Upon

Go To Commenting
The views expressed in this article are the sole responsibility of the author and do not necessarily reflect those of this website or its editors.

Writers Guidelines

Contact Author Contact Editor View Authors' Articles

Most Popular Articles by this Author:     (View All Most Popular Articles by this Author)

Israel's Gaza Atrocities Recall America's Atrocities in Vietnam

The Case for Impeachment of President Barack Obama

Barack Obama: Manchurian Candidate Version 2.0

Free John Walker Lindh, Bush's and Cheney's First Torture Victim!

What Nobody's Saying: The Bailout Will Kill the Dollar

Comments

The time limit for entering new comments on this article has expired.

This limit can be removed. Our paid membership program is designed to give you many benefits, such as removing this time limit. To learn more, please click here.

Comments: Expand   Shrink   Hide  
1 people are discussing this page, with 1 comments
To view all comments:
Expand Comments
(Or you can set your preferences to show all comments, always)
I wonder more and more what the hell the governmen... by Chris Mihal on Thursday, Feb 4, 2010 at 11:09:06 AM