Time to Investigate the Bureau of Labor Statistics
October 10, 2012
This column by ACRU General Counsel and Senior Fellow for the Carleson Center for Public Policy (CCPP) Peter Ferrara was published October 10, 2012 on The American Spectator website.
Who needs the Bureau of Labor Statistics (BLS), when you have Rush Limbaugh? Limbaugh predicted almost a year ago that the unemployment rate reported last Friday would fall below 8% for the first time since Obama entered office. Limbaugh by his own admission is no economist. So how did he know? Maybe because we are in the realm of politics now, rather than economics.
How Stupid Do They Think We Are?
The BLS reported last Friday that the economy in September created all of 114,000 net new jobs, just 104,000 in the private sector. To give you some context for how great that is, the working age population increased by 206,000 in September. With a labor force participation rate normal for the fourth year of a recovery (where we are right now), just keeping pace with that population growth would require 138,000 new jobs, before we can even start to reduce the unemployment rate.
Indeed, since Obama became President, the working age population has increased by 8.4 million. At the same labor force participation rate as when Obama entered office, that would require 5.52 million new jobs just to keep pace with that population growth. The total number of net new jobs created since Obama became President according to the BLS: 787,000.
But not to worry. The BLS also reported on Friday that the number of full time jobs actually declined last month by 216,000. Thank you, President Obama. You are doing a great job. Socialism is finally working. Forward. Why would we ever consider turning back now?
So how did the reported unemployment rate fall to 7.8%, down from 8.1% in August, and 8.3% in July? That is because the BLS (might consider dropping the L) also reported that the separate Household Survey, on which the unemployment rate is based, found a giant 873,000 jump in jobs last month, the biggest one month increase in nearly 30 years! That makes sense because the same survey found a decline in jobs of 119,000 in August and 195,000 in July.
Of course, 582,000 of those supposed jobs were part time “for economic reasons.” The BLS defines that as “individuals [who] were working part time because their hours had been cut back or because they were unable to find a full-time job.” That is not all good either. But a part-time job is better than no job at all.
The supposed sudden surprise spurt in September jobs in the Household Survey provided another gift to Obama. By August, for Obama’s entire term in office the economy had created less than zero jobs. In the more than three and a half years from Obama’s inauguration until then, the economy in total had lost 86,000 jobs. But the September surprise spurt of 873,000 jobs put Obama in the plus territory for his entire term with a grand total of 787,000 jobs created. Creating 787,000 jobs would be one ordinary month in the Reagan recovery, where the largest gain in one month was 1.1 million jobs in September, 1983. That was not an anomaly then, when the economy was on the way to creating 20 million new jobs in 7 years.
The supposed sudden explosion of Household Survey jobs is inconsistent not only with the 114,000 jobs found in the Establishment Survey of employers. It is also inconsistent with the reported GDP growth of 1.3% in the second quarter, which has been declining for over two years. Monthly job creation of 873,000 would require economic growth 3 to 4 times that large, at least.
It is inconsistent as well with the decline of 216,000 full time jobs found for September. It is inconsistent with the decline of 16,000 manufacturing jobs that the BLS also reported for September, totaling a decline in manufacturing jobs of 38,000 in the last two months. Indeed, the Household Survey September burst of jobs is inconsistent with the prior months of declining jobs in the Household Survey itself. All the rest of this and other economic data is consistent with the reality that we are heading back into recession. Except for the September Household Survey, which is the basis for calculating the unemployment rate 4 weeks before the election.
Until that new found one-time explosion of jobs in September, the only way the unemployment rate has been dropping under Obama at all has been because 8.2 million Americans have given up looking for jobs, and have left the work force, while he has been President. When they are counted as not in the work force, they are not counted as unemployed. But who is and is not in the work force is not a hard number. It is subject to interpretation.
Over 8 million Americans fleeing the work force under Obama is not good. But it is better than the double digit unemployment for several years that would have resulted if they had been counted as in the work force and unemployed. The U6 unemployment rate for September counted only 2.5 million of those technically not in the work force in its rate, and that rate for September was 14.7%.
So are the 8.2 million more Americans without jobs under Obama really not in the work force as the BLS contends? Or is that number fudged and manipulated too, so that Obama would not have to defend a Depression-era record on unemployment?
Just Asking Questions
I am not alleging fraud or manipulation by the career bureaucrats at the BLS, who I know from personal experience with career federal officials are overwhelmingly Democrat and personally supporting Obama for reelection. I also know from personal experience with the Washington, D.C. area that these career Washington bureaucrats are personally doing better than ever.
But given the above inconsistencies and anomalies, along with the strange, fortuitous timing of the sudden September burst in supposed jobs, I just think it is time to ask some pointed questions, under oath, in an official investigation. That includes the Obama appointees to which the career bureaucrats report, as well as the bureaucrats themselves.
Is this questioning beneath their dignity? Well, they are public servants, and if they don’t want to answer to the public, they are perfectly free to get into the Obama job market themselves and try their own luck.
This all can be conducted in hearings in the House, which is virtually the last check and balance on Obama in the federal government, especially as Chief Justice Roberts has recently shown that even the Supreme Court can be intimidated. Such hearings would simply involve traditional Congressional oversight.
Labor Secretary Hilda Solis indicated to reporters asking doubting questions about Friday’s labor report that she was insulted by the questions. Well, sister, you can be insulted by this whole column. Because I don’t trust you.