The presidential candidate who offers a bold, common sense plan to reverse the unemployment rate and to bolster disastrously sagging home values, without brutalizing Medicare or Social Security, will be elected to the White House in 2012. Period.
It's the economy, stupid. And it will continue to be the economy when Americans go to the polls in November 2012, despite incumbent President Obama's anticipated $1 billion campaign chest, and despite Obama's hunting down and killing Osama bin Laden.
The economy is stagnating and stumbling for middle-class and working class Americans in late spring 2011, 18 months before the 2012 elections:
Home Values and Foreclosures
'Double-Dip' in Housing Prices Even Worse Than Expected reports CNBC today. Financial implications of a continuing decline in home values are near-catastrophic for tens of millions across the nation. Per CNBC:
"(CNN's Wolf) Blitzer told CNBC that the decline in prices, though fairly widespread, has become more prevalent in geographic pockets--the Southwest and Southeast as well as the Michigan and Ohio manufacturing regions."
Michigan and Ohio are must-win states in the 2012 presidential race, as are Florida the Southeast and several states in the Southwest, including Nevada. Those same four states have among the highest foreclosure rates in the nation.... foreclosure rates that have worsened in 2011. Writes the Los Angeles Times today:
"In some parts of North Las Vegas, more than 80% of homeowners have plunged 'underwater,' meaning they owe more on their mortgages than their properties are worth -- a stunning concentration of aborted plans and upended lives."Nationwide, 23.1% of homeowners with mortgages are underwater. No state is more underwater than arid Nevada, with about two-thirds of borrowers holding such mortgages... "
Unemployment and Underemployment Blues
The national unemployment rate rose back to 9% in April 2011, a misleading statistic that masks crushingly high rates in certain states and regions, and among certain demographic groups.
In the four crucial high-foreclosure states mentioned above, March 2011 unemployment was:
- Michigan - 11.0%
- Ohio - 9.0%
- Florida - 10.6%
- Nevada - 13.2%
Underemployment is compounding the money woes of working Americans. The Wall Street Journal explained two years ago in Working Two Jobs and Still Underemployed:
"Mr. Crane is part of a growing group of underemployed -- people in part-time jobs who want full-time work or people in jobs that don't employ their skills. Since the recession began two years ago, the number of people involuntarily working part-time jobs has more than doubled to 9.3 million, according to the federal Bureau of Labor Statistics, the highest number on record."The proliferation of underemployed could represent a profound reordering of the employment structure. Many people who had comfortable full-time jobs with benefits and advancement opportunities now are cobbling together smaller jobs often at lower pay, in a shift that economists say could become permanent for many individuals stuck in the cycle. Underemployment, along with unemployment, is widely seen as a force slowing the economic recovery."
"Underemployment, a measure that combines part-time workers wanting full-time work with those who are unemployed, surged in February to 19.9%," per Gallup polling.
The Numbers Are Grim
The number are grim, the New York Times observed yesterday:
"The economy is not growing nearly fast enough to dent unemployment. Unfortunately, no one in Washington is pushing policies to promote stronger growth now."The sinkholes in the economy should be obvious. Most prominently, the housing market is still awful, and state and local government budgets are still a mess..."
A huge swath of American voters are hurting badly, and are desperate for solid economic solutions. But it's not apparent that anyone in Washington D.C. has noticed... or even gives a damn.
Mark my words: the presidential candidate... liberal or conservative, man or woman... who convinces middle-class and working-class Americans that he/she has a viable answer to stopping the financial sledgehammer from pulverizing families across the nation will be sworn in as U.S. President in January 2013.
As of today, I've heard or seen nothing to yet convince me that Barack Obama is that person.
- Related Reading
- What Are President Obama's 2012 Reelection Chances?
- What Will It Take for Housing to Recover?
- Wall Street Journal Market Watch - Why housing is in a depression
- FireDogLake - White House to America: We Won't Stop Foreclosure Fraud
Comments
You forgot two important points in the unemployment numbers. Those Americans who have exhausted their unemployment benefits after 99 weeks of unemployment who have been dropped from the rolls, and those small business owners who have closed their businesses due to the continued lack of business in the ever weakening economy. Neither of these groups are counted as unemployed, even if they are actively seeking work.
Adding these two groups of workers to the number of unemployed/under-employed brings the number of jobless and/or underemployed to nearly 25%.
The media cheerleaders for a failed administration keep reporting rosy numbers and happy statistics based on false assumptions as signs of a strengthening economy. But the American people are not stupid. It only takes a drive down any street to see the effects of this downturn. Another home is in foreclosure, another business is shuttered, another family is losing their home or dipping into the college and retirement funds to make it to the next month.
Teresa, I did not forget those points or many other statistical aspects of unemployment or foreclosures. My intent was to keep it simple and objective, and focus on the political fallout. Frankly, there are hundreds of ways these stats can be parsed.
Thanks for your comment, though.
Hi Deborah –
“The presidential candidate who offers a bold, common sense plan to reverse the unemployment rate and to bolster disastrously sagging home values, without brutalizing Medicare or Social Security, will be elected to the White House in 2012.”
Is there one? What would it look like?
Okay. Let’s break this down. How would one, as President, reverse the unemployment rate?
You could do a stimulus. There’s plenty of evidence that a stimulus package would work. However, there is no political appetite for additional stimulus spending. Indeed, since the recession officially ended in December 2009, there is a strong argument that we don’t *really* need one. Nice to have though.
Our Republican friends would say that we should lower taxes. However, there is plenty of evidence that lower taxes might not produce many new jobs. Even if it were so, there is that revenue thing.
The one control that a President has over the economy is monetary policy. However, that’s already at the floor boards.
How about “bolster disastrously sagging home values”? We might already be at the bottom. If so, it will happen by serendipidy. However, home values aren’t going to go up appreciably until the glut of foreclosures clear the market. Probably two years from now, at the earliest. Not much that a President could really do about that.
“Mark my words: the presidential candidate… liberal or conservative, man or woman… who convinces middle-class and working-class Americans that he/she has a viable answer to stopping the financial sledgehammer from pulverizing families across the nation will be sworn in as U.S. President in January 2013.”
Okay. The key word is ‘convinces’. Whether true or not.
“As of today, I’ve heard or seen nothing to yet convince me that Barack Obama is that person.”
Come November, we may have s distasteful choice. However, I would gently suggest that this choice will be pretty clear cut.
Oh, the recession ended in 2009. I must have missed that memo. Wish someone would have told me and shown me how my family is now out of recession status. All I know is that my savings dwindles more each month due to these small or null paychecks.
Liberal Politics or not – we face these issues. Unemployment is soaring and no one is minding the shop. Us 99ers and small business owners, even medium business owners are not counted because we don’t make the records or have fallen off them. True UE is 25% or more. Look around you. Unless you are in an especially lucky area, at least 1 of every 4 friends is un or under employed. It is hitting home and it hurts.
I saw our house decline this year in value. Sure it means lower taxes but… We need a solution. We all do! Jobs that are hiring are under paying us all since they know everyone is desperate enough to take it and actually be grateful at the time of hire. Sure, they are concerned about retention but their bosses are not authorizing hirer salaries since they know talent can be obtained at the lower price which only further fuels the underemployment issues. When will it all end?
Hi Andrea –
“Wish someone would have told me and shown me how my family is now out of recession status.”
I am sincerely sorry. FWIW, I have plenty of family in recession, if not depression, status. However, a recession ‘technically’ ends after six months of GDP growth. And I know that ‘technically’ doesn’t really cut it.
“True UE is 25% or more.”
At the depths of the Great Depression, the unemployment rate was 25%. If I were to guess, I’d say that the current actual unemployment rate, including the underemployed, is between 15% and 17% nationwide.
Ohio has been in deep recession for years now, our unemployment rate higher than the national average, and people here are universally saying… excepting the diehard democrats who sing the same tired hymnals from FDR,..
The current president is failing them,..
I’m conservative through and through, disagree with virtually every stand you take, distrust your sources, and wouldn’t pour water on Trumpka if he were on fire..
That said, you can count on this… most regular working folks are neither progressive or partisan republicans.. they barely pay attention outside the election cycle to who’s in or out. They do however like any living creature, know when they’re hurting, to blame the ones in charged with seeing that it’s over quickly, and that it should be their first priority.
The only name I hear in casual converstion, even from nominal democrats, is Obama.. they never mention Bush, or anyone else.. they don’t care who was in two going on three years ago..
They blame the current president, fairly or not depending on your preceptions, that is how it happens.
It barely matters to the largely politically apathetic voters who show up to punish the incumbents.
Unless the numbers improve soon, Obama has zero chance to win.. I believe that’s not only fair, but hugely his own fault. Keynesian policies never work, have never worked,.
Businesses are sitting dorment, if asked, they say the same things.. they WILL NOT commit to increased spending to expand their businesses until they know with certainty what is coming from Washington with Obamacare and tax policies.
You can hate it all you want, but 80% of new jobs are from small businesses. They don’t like or trust this progressive government either. A major problem when the left needs them.. but spends all it’s time demonizing them, and wrapping them up in red tape.