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Tom Blumer

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January 28, 2014 - 12:02 am
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When President Barack Obama delivers his State of the Union speech on Tuesday, he will surely contend — as he did in 2013, 2012, 2011, and 2010 — that “our union” is “stronger,” “getting stronger,” or at least “strong.”

It is no such thing.

The federal government is certainly weaker, and the situation continues to worsen. The five highest annual deficits the nation has ever incurred have been on Obama’s watch. Barring a significant improvement in the economy — unlikely, as will be seen — the sixth highest will occur when the current fiscal year ends on September 30. The national debt, at $17.27 trillion as of January 22, has increased by a jaw-dropping $6.6 trillion since he was first inaugurated. That this year’s deficit will be less than half of the official $1.4 trillion recorded in fiscal 2009 means, in his mind, that we can ramp up spending again. Outlays for the federal government’s operations plus interest are on track to remain above $3.5 trillion this year. That’s a ridiculous 30 percent above fiscal 2007, and virtually unchanged from fiscal 2009, when the so-called stimulus package was sold as a largely temporary spending ramp-up.

In his 2012 speech, Obama admitted that “the recovery is still fragile.” Two years later, in most of the U.S., it still hasn’t happened.

Yes, the overall economy finally got its real gross domestic product (GDP) back above where it was at the end of 2007 during the second quarter of 2011, the eighth quarter after the recession’s official June 2009 end. No other post-World War II recovery required more than three. It even met Warren Buffett’s benchmark for determining the recession’s end, namely ”when real per capita GDP gets back up to where it was before,” in the second quarter of last year. The problem is, it took 22 quarters for that to happen, twice as long as after any other post-World War II comeback.

Unfortunately, the economy’s GDP recovery is still very slight, very unevenly spread geographically, and far less important than its failure to regain pre-recession employment levels in the vast majority of the nation.

In its recently released 2013 County Tracker based on late 2013 data, the National Association of Counties (NACo) echoed Obama’s early 2012 statement. Noting that the “recovery is still fragile in some parts of the country,”the NACo report described a still dismal situation:

About half of U.S. county economies had no recession or recovered their economic output (GDP) lost during the recession by 2013, most of them in the South. About 800 county economies, mostly in the South and Midwest, had no drops in employment over the last decade or were above their pre-recession levels in 2013.

Which tells us that roughly half of all U.S. counties have failed to return to their previous GDP over four years after the recession officially ended. Clearly, far more than half have failed to get back to their previous levels of per capita GDP.

Given that the U.S. has 3,069 counties (Connecticut and Rhode Island, which are two of the country’s worst economic basket cases, don’t have county governments), that paragraph’s second statement is much more troubling. Only about 26 percent of them (800 divided by 3,069) have returned to or exceeded their previous employment levels. In other words, almost three-fourths haven’t.

Top Rated Comments   
Very good, thank you. We live in what Thos. Sowell once called the Age of the Yak -- meaning endless blather as a substitute for reality.

We're now at extreme levels and the panic is rising: elites haven't a clue (doubt that? -- read up on Davos) and central banks around the world are down to firing blanks and scattering smiley-face propaganda. Politicians generally don't even speak the language, though they do pick up the clues needed to blame someone else before they run for the hills. And as for media and academics....

I'm temporarily based in europe. The nightly antics in the media -- I watch the 'best' stations in UK, France, Spain and, sometimes, Germany -- all drink from the same bucket of warm spit, often with a shared straw (same footage, same spin). The EU is in an even bigger mess than we are.
Sooner or later, we've all got a date with reality.
11 weeks ago
11 weeks ago Link To Comment
All Comments   (11)
All Comments   (11)
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I have some acquaintances in the UK I tweet back and forth with and they are not very pleased either. They feel their government has betrayed them on immigration, political correctness, banksterism, all the same gripes we have.
I don't think the rest on Europe is all that placid either.Something big is rumbling just below the surface of the first world and there will soon be hell to pay. Our messiah and hopeychange guy is just piling up the powder waiting for the match to drop.
Watch out.
11 weeks ago
11 weeks ago Link To Comment
I also, have an acquaintance, a retired British Army Colonel, who lives in London. He used to say the same things that you mention. But he has been silenced, and is now afraid to criticize anything about what he used to call the Fascist-Left elites who run Europe and the UK. But he says it is obvious that people are angry, and growing angrier, and sooner or later will take action.
11 weeks ago
11 weeks ago Link To Comment
real median household income hasn’t budged in two years

Puleeze, real median household income has fallen dramatically every year for the past fifteen or twenty or so. Especially so if you exclude the top 1%.
11 weeks ago
11 weeks ago Link To Comment
Actually, the numbers I find are:

Year end 2000 56,538
In between 2000 and 2008 are dotcom crash and 9/11
Year end 2008 56,948
Mid 2009 at recessions end approx 55,000
Mid 2011 low point 51,079
Year end 2013 52,297 and has been essentially unchanged since year end 2011

I don't see dramatic decline every year for past 15 years. Cratered since the END of the recession in mid 2009 from 55,000 to 52,300 where we seem to be stuck.
11 weeks ago
11 weeks ago Link To Comment
Are these numbers adjusted for inflation?
11 weeks ago
11 weeks ago Link To Comment
Yes. REAL Median Household Income. I didn't go back to look, but if I recall correctly adjusted to 2013 dollars.
11 weeks ago
11 weeks ago Link To Comment
If you were Cloward-Piven, Bill Ayers, Frank Marshall Davis, Van Jones, Anita Dunn, Paul Krugman, Chomsky, Zinn, Soros, the Midwest Academy, the Socialist Scholars, ...how would the economy be doing?

Would you be pleased at the crushing weight of policies that are killing small businesses and wiping out entire industries?

Would you be pleased at the confiscatory taxes and tyrannical imposition of laws, selectively prosecuted against those who dissent?

The economy is doing fine. If, by fine...we use the definition of Barack Obama, Sr. And the Weathermen. And the One World Socialists.

Take a look at what THOSE people have advocated out loud...and try to convince any rational, reasonable person...that it is mere coincidence that the policies that lead our current condition...is the conspiracy theory of "an hysteric".
11 weeks ago
11 weeks ago Link To Comment
Market Place Mall in Champaign, Illinois has seen better days. IMO it is worse off than it was last summer. It has 4 anchor stores and one of them has left. It is Sears and sears has had problems for over a decade. So let's discount that datum. Among retail spaces there are many vacancies.

This mall is in a major college town. There is not another mall in the metropolitan area other than Lincoln Square Mall and it does not count. It looks like it had wanted to dry up and blow away for decades.

an investor and write once wrote that he di d nt want to be dragged to the mall by his family. He relented and started observing mall traffic and it gave him insights or reinforcement n how to invest.

So yeah, I now watch mall traffic after reading his article. Mall traffic is down after 4 Obama Summers of Recovery.
11 weeks ago
11 weeks ago Link To Comment
Another reality check this AM.

"Durable goods which in November were said to have risen by 3.5%, were revised lower to 2.6% (we said there was something very fishy with the seasonally adjusted numbers last month). The December number, however, plunged by 4.3%, well below the expected 1.8%, and a paltry 0.1% increase Y/Y. Any time the Y/Y series is consistently negative, there is a recession."
11 weeks ago
11 weeks ago Link To Comment
Very good, thank you. We live in what Thos. Sowell once called the Age of the Yak -- meaning endless blather as a substitute for reality.

We're now at extreme levels and the panic is rising: elites haven't a clue (doubt that? -- read up on Davos) and central banks around the world are down to firing blanks and scattering smiley-face propaganda. Politicians generally don't even speak the language, though they do pick up the clues needed to blame someone else before they run for the hills. And as for media and academics....

I'm temporarily based in europe. The nightly antics in the media -- I watch the 'best' stations in UK, France, Spain and, sometimes, Germany -- all drink from the same bucket of warm spit, often with a shared straw (same footage, same spin). The EU is in an even bigger mess than we are.
Sooner or later, we've all got a date with reality.
11 weeks ago
11 weeks ago Link To Comment
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