Obama's Rebound Numbers are Misleading

Donald Lambro

1/14/2011 12:01:00 AM - Donald Lambro

WASHINGTON -- Recent polls say Barack Obama's job-approval ratings are up, yet other indicators of our troubled times show that some of our biggest problems persist or have worsened under his presidency.

Forty-eight percent of registered voters said they approved of the job Obama is doing, though 44 percent didn't, and 8 percent were undecided, according to a Quinnipiac University poll conducted between Jan. 4 and Jan. 11.

However, when voters are asked if his two years in office have "been mainly a success or mainly a failure," 47 percent said mainly a success, 45 percent said mainly a failure, and 8 percent said they were still undecided. Not a good sign for his prospects in 2012.

Fifty percent of the electorate's independent voters, who hold no allegiance to either party and have turned against him in the past two years, said he has been mainly a failure. Only 39 percent said he has not.

This split decision on his job-approval scores stems in large part from his failure to get the engine of the American economy up and running at full throttle, producing the number of jobs needed to move the country back to full employment -- as it was in 2007, the year before he was elected, when unemployment was a low 4.7 percent.

The job-creation numbers for the month of December showed the unemployment rate falling from 9.8 percent to 9.4 percent, but the reasons why got lost or obscured by many of the network nightly news shows.

First and foremost, the jobs created last month were, in and of themselves, too meager to drive down unemployment. Employers added 103,000 to the nation's payrolls, but it was nowhere close to the numbers needed to keep up with population growth.

Obama, boasting about the anemic jobs numbers, said that the economy has produced jobs during every month under his presidency.

But University of Maryland business professor Peter Morici says that, under Obama's current snail's pace record, "it will take six years to recoup the 8 million jobs lost during the Great Recession. By then, another 9 million job seekers will have joined the labor force."

Most economists are saying that under the glacial pace of new job creation, unemployment could be in the 8 percent to 9 percent range by 2012. Fed Chairman Ben Bernanke, in testimony before Congress last week, said that it could take four to five years for the economy to approach full employment.

There is less than meets the eye in last month's much-ballyhooed drop in the unemployment rate. Yes, the decline in the jobless rate was in part due to the number of jobs created last month, but it was also the result of "a nearly equal number giving up and dropping out of the workforce," says the Washington Post's economics writer Neil Irwin.

When compiling its monthly unemployment rate, the Bureau of Labor Statistics counts only people who are looking for work. People who say they are no longer seeking employment are subtracted from the overall labor force and that drives the unemployment rate down -- which is what happened last month.

The news sound bites and headlines led with "unemployment rate falls," but the reasons why were often obscured or buried in the fog of shallow nightly news reporting.

Have you noticed how little the network news shows address the unemployment rate and its severe impact on our country, except of course when the monthly numbers come out?

Democratic leaders in Congress rarely bring it up, hoping that the issue will go away by itself.

And then there are the other economic and social indicators that are fueling Obama's latest disapproval numbers.

The national poverty rate increased to 14.3 percent of the nation's population in 2009, compared to 13.2 percent in 2008, and forecasters are predicting that data will show it worsened in 2010. In the South, the rate has risen to nearly 16 percent.

The housing industry, despite all of the government programs Obama has pored money into, still remains in a deep recession. The Federal Reserve's annual report on the economy, in the so-called Beige Book, said this week that "activity in residential real estate and new-home construction remained slow across all (Fed) Districts."

In nine of the 12 Fed Districts, home prices fell or remained in neutral, with a continuing oversupply of houses in the real-estate market that has paralyzed the construction industry. Foreclosures and evictions continue at a high rate.

Meantime, beware of news reports that a booming economy is just around the corner. Remember all those breathless stories of robust Christmas sales in December? It turns out they were weaker than expected. Overall sales looked solid, "but this was not the December many had hoped for," says Amy Noblin, a retail analyst with Weeden & Co.

Before December's unemployment data came out, the payroll-processing firm ADP released a widely promoted report that said businesses added nearly 300,000 jobs. Not even close.