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Archive for the ‘Economy’ Category


by Joseph BeverlyJobs12

Wall Street Journal Headline: “U.S. Adds 113,000 Jobs, In Latest Worrying Sign On Growth.” (Eric Morath and Josh Mitchell, “U.S. Adds 113,000 Jobs, In Latest Worrying Sign On Growth,” Wall Street Journal, 2/7/14)

“The Labor Market In January Registered Weak Gains For The Second Straight Month, A Slowdown That Could Heighten Fears About The Economic Recovery.” “The labor market in January registered weak gains for the second straight month, a slowdown that could heighten fears about the economic recovery and may lead some to call on the Federal Reserve to reconsider its easy-money strategy.” (Eric Morath and Josh Mitchell, “U.S. Adds 113,000 Jobs, In Latest Worrying Sign On Growth,” Wall Street Journal, 2/7/14)


The New York Times : “A Disappointing Showing…” “The American economy added 113,000 jobs in January, a disappointing showing that is likely to spur fears that the labor market is poised for yet another slowdown. Before the report from the Labor Department on Friday morning, economists had been looking for the economy to gain 180,000 positions last month. But after an extraordinarily weak showing for hiring in December, some experts are concerned that weakness is carrying into 2014 and signaling a broader loss of momentum in the economy.” (Nelson D. Schwartz, “Weakness Continues As 113,000 Jobs Are Added In January,” The New York Times , 2/7/14)

CNN: Jobs Report “Far Weaker Than Hoped.” “The U.S. economy added 113,000 jobs last month, according to the government. That’s an improvement from December, but was far weaker than hoped. Economists had been expecting an addition of 178,000 jobs.” (Annalyn Kurtz, “Job Growth Remains Weak,” CNN, 2/7/14)

Politico : “The Number Of Jobs Added Fell Short Of Expectations.” “The number of jobs added fell short of expectations – analysts had predicted job growth of around 181,000, according to a Bloomberg survey.” (MJ Lee, “The Number Of Jobs Added Fell Short Of Expectations,” Politico, 2/7/14)

Politico Headline: “Another Disappointing Jobs Report.” (M.J. Lee, “Another Disappointing Jobs Report,” Politico, 2/7/14)

Financial Times Headline: “U.S. Employment Growth Disappoints In January.” (James Politi, “U.S. Employment Growth Disappoints In January,” Financial Times, 2/7/14)

CNBC’s Brian Sullivan: The Headline Number Was “A Big Miss.” THOMAS ROBERTS: “All right, so we got the first Friday of the new month, which means that the January jobs numbers have just come out, and CNBC’s Brian Sullivan joins us now with the breakdown on the economic news. And Brian, if we get meta on it, we see that the unemployment rate has dropped. So, explain where we see the best results.” SULLIVAN: “Well, the headline number, Thomas, was a big miss. We expected 180,000 jobs to be created in January. Unfortunately, that number was lower than expected at 113,000.” (MSNBC’s “Morning Joe,” 2/7/14)

Sullivan: “Certainly Not The Kind Of Number That Wall Street’s Going To Want To See.” SULLIVAN: “Overall, though, a headline miss, trying to dig out a few of the brighter spots HERE, so it’s not 100 percent negative. Certainly not the kind of number that Wall Street’s going to want to see, necessarily. But it does put the federal reserve back into play with the very dovish Janet Yellen as the fed chair.” (MSNBC’s “Morning Joe,” 2/7/14)

CNBC’s Steve Liesman: “It’s A Weak Report, No Doubt About It. I Think There’s A Disappointment In The Lack Of Revisions To December.” (CNBC’s “Squawk Box,” 2/7/14)

Bloomberg’s Peter Cook: “This Number, 113,00 Jobs Created Last Month Not The Kind Of Number The Fed Wants To See, Not The Kind Of Number Unemployed Americans Want To Be Seeing, Certainly Not The Number White House Wants To See.” (Bloomberg, “In The Loop,” 2/7/14)

The Associated Press : “Hiring Was Surprisingly Weak In January For The Second Straight Month, Likely Renewing Concern That The U.S. Economy Might Be Slowing After A Strong Finish Last Year.” (“US Employers Add 113K Jobs,” The Associated Press , 2/7/14)

“This Follows December’s Tepid Increase Of Just 75,000.” “This follows December’s tepid increase of just 75,000. Job gains have averaged only 154,000 the past three months, down from 201,000 in the preceding three months.” (“US Employers Add 113K Jobs,” The Associated Press , 2/7/14)
“Sluggish Job Growth For A Second Straight Month May Reflect What Investors And Economists Have Begun To Fear: That The U.S. Job Market Is Weakening Again, Along With Sectors Like Manufacturing And Retail Sales In The United States And Abroad.” (“US Employers Add 113K Jobs,” The Associated Press , 2/7/14)


“December’s Weak Payroll Figure, And Signs Of Weakness In The Housing Sector And Emerging Markets, Sparked Fears That 2014 Could Get Off To A Disappointing Start. January’s Report May Heighten The Concerns.” (Eric Morath and Josh Mitchell, “U.S. Adds 113,000 Jobs, In Latest Worrying Sign On Growth,” Wall Street Journal, 2/7/14)

“Compared With Previous Economic Downturns, Of Course, The Recovery That Followed The 2008 Financial Crisis Is Still Crawling.” “Compared with previous economic downturns, of course, the recovery that followed the 2008 financial crisis is still crawling. In the 10 recessions the U.S. has faced since the end of World War II, until 1980 it took an average of nine months for the labor market to fully heal, according to the Economic Policy Institute.” (Alain Sherter “Another Month Of Weak Job Growth,” CBS News, 2/7/14)

CBS News Headline: “Another Month Of Weak Job Growth Raises Slowdown Fears.” (Alain Sherter “Another Month Of Weak Job Growth,” CBS News, 2/7/14)

“The Year-End Plunge In Job-Creation Has Raised Fears That The Economic Recovery Was Losing Steam.” (Alain Sherter “Another Month Of Weak Job Growth,” CBS News, 2/7/14)

The New York Times : The Jobs Report “Is Likely To Spur Fears That The Labor Market Is Poised For Yet Another Slowdown.” “The American economy added 113,000 jobs in January, a disappointing showing that is likely to spur fears that the labor market is poised for yet another slowdown.” (Nelson Schwartz, “U.S. Adds 113,000 Jobs In January,” The New York Times, 2/7/14)

“Some Experts Are Concerned That Weakness Is Carrying Into 2014 And Signaling A Broader Loss Of Momentum In The Economy.” “But after an extraordinarily weak showing for hiring in December, some experts are concerned that weakness is carrying into 2014 and signaling a broader loss of momentum in the economy.” (Nelson Schwartz, “U.S. Adds 113,000 Jobs In January,” The New York Times , 2/7/14)

Los Angeles Times : Job Growth Was “Sluggish,” And Is “Likely To Heighten Concerns That The Economy And Labor Market Recovery May Be Faltering Again.” “Job growth was sluggish in January for the second straight month, the government said Friday in a report likely to heighten concerns that the economy and labor market recovery may be faltering again.” (Don Lee, “Job Growth Remains Weak In January,” Los Angeles Times, 2/7/14)

“A Second Straight Month Of Weak Job Growth Raised Concerns That The Economic Recovery…Is Stalling Out.” “A second straight month of weak job growth raises concerns that the economic recovery, which had seemed to be gaining speed, is stalling out. Employers added a disappointing 113,000 jobs in January, according to the U.S. Labor Department’s latest employment report, short of consensus forecasts. Unemployment ticked down to 6.6 percent, from 6.7 percent. Most economists had forecast payroll growth in January of around 185,000.” (Alain Sherter “Another Month Of Weak Job Growth,” CBS News, 2/7/14)

“It Has Been 55 Months Since The Recession Officially Ended In June 2009, And Employment Levels Remain A Long Way From Their Pre-Bust Highs.” “Since then, however, the economy has taken longer and longer to snap back into shape. It took nearly two years after the 1990-91 recession for job growth to hit its previous peak; following the dot-com crash in 2001, the economy need 39 months to recover. By comparison, it has been 55 months since the recession officially ended in June 2009, and employment levels remain a long way from their pre-bust highs. The economy would need to add an average of 285,000 jobs per month for the next three years for the labor market to return to where it was just before the recession, according to EPI, a liberal-leaning think-tank.” (Alain Sherter “Another Month Of Weak Job Growth,” CBS News, 2/7/14)

Guess What Group is Getting Food Stamps at an Alarming Rate

obama-soup-line-e1340713849725-500x350-220x120Food stamp rolls have been growing rapidly. But what many may not realize is that participation among able-bodied adults without dependents (ABAWDs) has been skyrocketing compared to the total number of participants. That’s just one reason Congress should reform the food stamp program in the farm bill now under consideration. In just four years, the number of able-bodied adults without dependents (ABAWDs) on the food stamp rolls skyrocketed by over 2 million. While overall food stamp use grew by 53 percent between Fiscal Year 2007 and Fiscal Year 2010 (from about 26 million to nearly 40 million), it more than doubled among able-bodied adults without dependents during this time–from 1.7 million to 3.9 million–an increase of roughly 127 percent. Food stamp spending today is roughly $80 billion, double what it was in Fiscal Year 2008.

Going forward, food stamp policy should ensure that resources are going to those most in need — particularly at a time when budgets are tight for so many Americans Able-bodied recipients should be encouraged to work. This way, help is available to those who truly need it, while at the same time individuals are encouraged to do what they can to help themselves.

Congress has the opportunity now to reform food stamps as policymakers debate the farm bill. The House’s current proposal makes some steps towards encouraging work, but it is yet to be seen whether the House will maintain the work component of their proposal, or if they will fold on this important matter.
While the recession no doubt plays into the increases in food stamp participation, policy loopholes have opened the doors to boost growth as well In his 2009 stimulus bill, Obama allowed states to waive the modest ABAWD work provision (which says that after 3 months ABAWDs must work or perform some type of work activity for 20 hours per week to remain on food stamps).
With the work waivers in place, ABAWDs can stay on food stamps for an unlimited amount of time without working or preparing for work. Without a work requirement it is difficult to ensure food stamps are not going to those who could otherwise work. A work requirement acts as a gatekeeper: those who really need assistance can still get it, while those who may not really need it will be deterred, thus targeting resources to the truly needy. It also encourages individuals to move towards work, and it can provide job training and other employment help.
Self-sufficiency for able-bodied adults should be the goal of any sound welfare policy. Unfortunately, most of the government’s 80-plus welfare programs–including food stamps–aren’t focused in this direction.
Helping those in need means helping them rise above government dependence. Unfortunately, self-sufficiency seems to be kicked to the bottom of the list all too often when it comes to reforming the nation’s broken welfare system. It’s time for Congress to realize that helping individuals means a hand-up, not merely a handout.

10 Things You Might Not Realize You’re Paying For Through Washington’s Budget Deal

Washington is currently considering a $1.1 trillion appropriations bill for fiscal year 2014. The 1,582-page mother of a document sets the spending priorities (not limits) for a variety of government agencies and initiatives. Here are a few you may not know about:

#1 – “Increased Intelligence Collection” Efforts Against Notorious Ugandan Guerilla Leader Joseph Kony: $30 million

#2 – Equipment for School Cafeterias: $25 million

#3 – Marketing Campaign to Prevent Domestic Terrorism: $3 million

#4 – National Endowments for the Arts and National Endowment for Humanities – $146 million

#5 – Woodrow Wilson International Center for Scholars – $10.5 million

#6 – HIV/AIDS Programs – $2.3 billion

#7 – Department of Education’s “First of the World” Initiative – $75 million

#8 – Veterans Affairs Employee Training and Overtime Pay – $100 million

#9 – Amtrak – $1.39 billion

#10 – Architect of the Capitol’s Office – $602 million


White House reaches out to Sen. Paul for economy meeting

Rand paulSen. Rand Paul, R-Ky., a frequent thorn in President Obama’s side, is among a bipartisan group of senators expected to attend the president’s announcement Thursday on the designation of “Promise Zones” to help communities tackle poverty.

Paul is also expected to join Senate Minority Leader Mitch McConnell and other lawmakers at a private meeting with the president at the White House to discuss the initiative prior to the announcement, an aide for Paul told Fox News.

Though Paul’s inclusion may seem out of place, the conservative senator recently introduced separate legislation to create “economic freedom zones” in troubled cities like Detroit where taxes and red tape would be cut in order to encourage growth.

“They say the sincerest form of flattery is imitation,” Paul told Fox News, confirming he will be at the White House on Thursday. He questioned, though, why the president’s plan does not include Detroit, as his does.

Obama’s announcement is part of a focus on income inequality in the lead-up to his State of the Union address. Promise Zones are areas where the federal government provides tax incentives and grants. Obama first announced the initiative during last year’s State of the Union speech.

An eight-county region of southeastern Kentucky will be among five locations that Obama will announce this week as “Promise Zones.” The president’s proposed zones also include San Antonio, Texas; Philadelphia; Los Angeles; and the Choctaw Nation of Oklahoma.

The Paul invitation could have the makings of another Obama “charm offensive” to reach out to Republicans, as he did early in 2013 to try — unsuccessfully — achieve a “grand bargain” budget deal.

Paul may be a particularly elusive legislative partner. Besides launching a recent class-action lawsuit against the administration over the National Security Agency’s spying practices last week, Paul has also pressed Obama on a range of issues, including a filibuster over his drone policy.

McConnell, R-Ky., said in a statement Wednesday he was pleased the Obama administration decided to include Eastern Kentucky in its promise zone designation.

“I wrote a letter last year supporting this designation because this region has suffered enormous economic hardship over the last several years,” McConnell said. “Thousands of jobs have been lost and economic opportunity is extremely limited, particularly because of this administration’s hostile policies toward the coal industry.”

Fox News’ Ed Henry and The Associated Press contributed to this report.

Minimum Wages: Evaluating New Evidence on Employment Effects

David Neumark – UC-Irvine, J.M. Ian Salas – UC-Irvine Min Wages

The fierce political debate over raising the minimum wage, which is repeated yearly in legislatures across the country, has at times been matched by a strong academic debate on the subject. Specifically, economists have argued over whether a higher minimum wage reduces the employment of less-skilled jobseekers.

The published research on the subject points overwhelmingly in one direction: A summary of the last two decades of literature on the minimum wage, co-authored by the lead economist on this study, concluded that most of the evidence points to job loss following wage hikes. Economists have detected this job loss using state variation in minimum wages, with states that do not raise their minimum wage acting as a “control group” for states that do.

But today, a small group of economists has mounted an aggressive challenge to the existing academic consensus on minimum wages. In a series of studies first published through the organized labor-aligned Institute for Research on Labor and Employment (and later in the journals Review of Economics and Statistics and Industrial Relations), they’ve argued that prior studies on the minimum wage were incorrect in blaming the policy for a drop in employment opportunities among less-skilled employees (like teens) or in service-intense industries. Rather, they claim, these employment declines are due to unrelated changes in states’ economies—in particular, unexplained downturns in employment of unskilled workers that just happen to coincide with dozens of state minimum wage increases.

To get around this purported problem, they toss out most of the labor market data available to detect the effects of wage increases, and restrict their analysis to either neighboring state border counties or states in the same Census division. Using this highly-restrictive model, they claim, provides better control groups and shows that a higher minimum wage has no negative effect on employment.

With the encouragement of the economists themselves, who have a history of working in support of progressive causes, these studies (henceforth IRLE papers) have gained prominence among activist groups who leverage them to claim that mandated wage hikes will have no adverse impact on employment. (One of the economists even said explicitly at a 2010 conference in Atlanta that this research should “help to pave the way” for higher mandated wages.)

Or so they hope. But in this new study, University of California-Irvine labor economist David Neumark worked with UC-Irvine Ph.D. student J.M. Ian Salas to determine whether the IRLE papers have merit. Specifically, do the studies make good on the claim their authors’ have put forth, of overturning the decades of research preceding them? Neumark and Salas report that the evidence presented in the IRLE papers only runs contrary to earlier studies because the authors’ empirical models rely on inappropriate control groups, and toss out the economic data necessary to detect the impact of a minimum wage increase. They are unequivocal in their conclusion: “[N]either the conclusions of these studies nor the methods they use are supported by the data.”

The authors of the IRLE papers provide no direct evidence to justify their highly-restrictive study design, instead speculating that nearby states or counties constitute ideal control groups against which to measure the effects of the minimum wage. But Neumark and Salas demonstrate that the premise of the IRLE papers is wholly incorrect: If you examine the characteristics of the control counties and states used in the IRLE papers (which the authors of those papers failed to do), you find that they’re generally very poor control groups.

For instance, the authors’ preferred control for Leon County, FL—home of the Florida state capital in Tallahassee, with a population of roughly 275,000 people—is Grady County, GA, which has barely 25,000 people and no major cities.

Similarly, one control state for Connecticut—a vibrant northeastern state with 3.5 million people and $237 billion in annual economic output—is Vermont, a state with roughly 1/6th of Connecticut’s population and one-tenth its economic output.

Instead of speculating about which states represent ideal controls, Neumark and Salas closely examine the economic characteristics of all states in each Census Division, and find that it’s mostly states outside the Census Division that serve as better control groups. (A similar pattern holds for nearby counties, which they also examine individually.)

Yet all of this identifying data is discarded by the authors of the IRLE papers. In other words, the robust set of control groups the authors use actually aren’t robust at all—indeed, they’re less suited to the task at hand than studies that have come before. And in the small number of cases where nearby states or counties are appropriate controls, the data in these cases show that employment did fall after a minimum wage increase.

Given their numerous methodological problems, it’s not surprising that the evidence in favor of the empirical approach advocated in the IRLE papers is “weak or non-existent.” When the analysis is not restricted to these inappropriate control groups, the data clearly show that wage hikes do cause job loss. Indeed, in some cases Neumark and Salas find that the IRLE authors omitted evidence that exposed the weaknesses in their approach.

Neumark and Salas end with a strong admonishment to the authors of the IRLE papers: “[P]rior to concluding that one has overturned a literature based on a vast number of studies, one has to make a much stronger case that the data and methods that yield this answer are more convincing than the established research literature that finds disemployment effects, and understand why the studies in that literature would have generated misleading evidence.”

It’s a warning that the economists themselves should heed, as should legislators eager for studies (no matter their accuracy) that validate their ideological preferences.

Marine Le Pen: EU will collapse like the Soviet Union


By Martin Banks, Henry Samuel and Alex Spillius

The leader of France’s far-Right party has vowed that the European Union would “collapse like the Soviet Union” as she conspired to form what would be the most radical faction yet seen in the European parliament.
Marine Le Pen, buoyed by a weekend by-election triumph in southern France, criticised the EU as a “global anomaly” and pledged to return the bloc to a “cooperation of sovereign states”.
She said Europe’s population had “no control” over their economy or currency, nor over the movement of people in their territory.
“I believe that the EU is like the Soviet Union now: it is not improvable,” she said. “The EU will collapse like the Soviet Union collapsed.”
Ms Le Pen, 45, will next month travel to Holland to chart a joint campaign with Geert Wilders, whose anti-Islamic Freedom Party (PVV) currently tops national opinion polls for May’s European elections.
Together they aim to establish a pan-European, far-Right parliamentary grouping that would run on an anti-immigrant, anti-integration platform. Once in office its overriding aim would be to be as disruptive as possible.
Even ardent European federalists now concede that as much as 30 per cent of the new parliament will comprise Euro-sceptics capitalising on economic misery and record levels of unemployment across Europe.
“If Eurosceptic parties are successful in 2014, this would create the most extreme European parliament ever,” Sarah Ludford, a Liberal Democrat MEP, said.
“I’m alarmed at not only their racist and discriminatory attitudes but also their protectionism and hostility to the European single market to which three million British jobs are linked.”
Guy Verhofstadt, a former Belgian PM, urged mainstream parties across Europe to stand firm against the forces of extremism that fuelled the Second World War.
“If we allow these forces to gain a foothold once again on our continent we will have wasted a century of building closer ties and condemned history to repeat itself,” he said.
President François Hollande of France warned this week that the prospect of a significant anti-EU grouping could lead to “regression and paralysis” in Europe, adding that it could threaten the continent’s ability to recover from the after-effects of the crisis in the Eurozone.
Ms Le Pen has already cultivated links with Austria’s far right Freedom Party, which gained 21 per cent of the vote in last month’s general election.
Mr Wilders, whose party was until last year a member of his country’s ruling coalition, has forged links with Vlaams Belang in Belgium, the Democratic Party in Sweden and the Northern League in Italy.
“We want to do whatever we can to turn the forthcoming European elections into a Europe-wide electoral landslide against Brussels,” said Mr Wilders.
The new anti-EU bloc would be to the Right of the existing Eurosceptic group in Brussels, Europe of Freedom and Democracy, which is dominated by the UK Independence Party.
Nigel Farage, Ukip’s leader, has ruled out any alliance with FN or PVV, saying their views on race and religion were too extreme.
It is predicted Ms Le Pen’s party could win 20 seats or more in May. Forming an official group in the European parliament requires 25 members from at least seven of the union’s 28 states.
Creating such an official faction brings major advantages such as guaranteed speaking time in debates and considerable subsidies.
Ludovic de Danne, Ms Le Pen’s international affairs adviser, said: “She is not wandering alone in the desert. If I were a federalist, I would be very, very frightened.”
In the past Mr Wilders refused to associate with FN because he disapproved of the anti-Semitic remarks of Ms Le Pen’s father, Jean-Marie Le Pen.
Since she replaced her father in January 2011, Ms Le Pen has tried to improve the party’s image and move it into Left-wing territory on social policy and economic protectionism.
Previous attempts at cooperation by the far Right in Brussels have been defeated by national rivalry and policy disagreements.
In 2007, 23 far-right and nationalist MEPs formed a group called Identity, Tradition and Sovereignty. Within months, they had broken up after Alessandra Mussolini, an Italian MEP, insulted the Romanians.

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