Harbingers of Stagflation

The recent employment report was expected to show around a million new jobs. Only around a quarter of a million were created. The Consumer Price Index for April rose 4.2 %, even greater than the expected 3.6 % inflation.

And in other news, the Xiden administration wants to dump multiple trillions of deficit spending into the economy.

Carter’s second term is beginning to look like the best case scenario.

I wonder how badly the values of my 401k and IRA will be hit.

A Science Experiment

Whether or not they have realized what they were doing, the political leaders of several states have been conducting a scientific experiment. Their implied hypothesis is that extended draconian restrictions on the activities of the people in their states would result in fewer deaths from the Wuhan virus pandemic. Simultaneously several other states took the opposite approach to managing the pandemic, effectively providing a control group for the restrictive state experiment. We now have data comparing the results of the two approaches. Has the restrictive state hypothesis been falsified?

Here’s a chart of the relative performance of the states plowing relative levels of restriction versus death rate. A higher number on the death rate axis corresponds to a higher death rate. A higher number on the restriction axis corresponds to tighter restrictions.Chart Source: Wallethub

While there are more restrictive states among the ten best performing states, restrictive states account for half of the ten worst. Thus, the data do not support the hypothesis that tight restrictions on the public’s activities necessarily will result in relatively lower death rates.

It’s possible that tight restrictions on public activity might be beneficial in some circumstance, but the data also suggest the possibility that many other factors have affected the variation in performance among the states. For example, Hawaii and Vermont have relatively high restrictions, but are their low death rates a result of their relative isolation from the nation’s large population centers or some other factor? Could such relative isolation have a part in Nebraska’s low death rate? Could California’s high poverty rate be affecting its poor performance?

The science isn’t settled on exactly why some states are doing better than others, but it does seem to show that lockdowns and other such measures weren’t and aren’t a magic bullet.

Oh, one more thing …

The average unemployment rate in the the most restrictive states is 7.1% (9% in California). The national rate is 6.7%. The rate in the least restrictive states is 4.7% (3.1 % in Iowa).

Team Kimberlin Post of the Day

After Bill Schmalfeldt fled Maryland after losing LOLsuits III, IV, and V in rapid succession, he spent a bit more than a year in Milwaukee where he lost LOLsuits VI. He then moved on to his hometown of Clinton, Iowa, where he was briefly employed as a disk jockey at a local FM station. That gig didn’t last long, and his failure to keep the job was the subject of some pointage, laughery, and mockification in the comments here at Hogewash!, and that, of course, prompted an outburst from the Cabin Boy™ which was chronicled in a post titled Hilarious? Hilarious How? which ran three years ago today.

* * * * *

What does he mean I’m hilarious? What does he mean, the way I talk? What? Hilarious how? What’s hilarious about it? Hilarious how? Let me understand this, because, ya’ know, maybe it’s me, but I’m hilarious how? Hilarious like a clown? I amuse him? I make him laugh? I’m here to amuse him? Hilarious how? How am I hilarious? What’s so hilarious about me? What’s hilarious?

* * * * *

Actually, what’s hilarious is the Cabin Boy’s™ poor reading comprehension. I haven’t written anything here at Hogewash! about his being fired from his most recent job, but I will now note that he no longer seems be working an afternoon announcing gig at KMCN. OTOH, the Cabin Boy™ has plenty of experience never being impeded by not knowing what he’s talking about.

Failing failures gotta fail.

* * * * *

That post parodied a scene from Goodfellas, a movie containing a putdown line that Schmalfeldt often used. Given the number of jobs that have slipped through the Cabin Boy’s™ fingers over the past three years, something like a shoe shine box might be a reasonable investment for him as a way to pickup a bit of cash.

For the moment, he’s employed again. There are still some dates left on the calendar in the break area.

Campaign Promises

… I am absolutely certain that generations from now, we will be able to look back and tell our children that this was the moment when we began to provide care for the sick … (X)ObamacareScreenHartWeb

… and good jobs to the jobless; (X)labor-force-participation

… this was the moment when the rise of the oceans began to slow and our planet began to heal; ( )global-temperature-vs-co2

… this was the moment when we ended a war and secured our nation … (X)100918-A-0846W-219

… and restored our image as the last, best hope on earth. (X)G20 Leaders Meet In St. Petersburg For The Summit

Hmmmmmm.

So far, we’ve manage one goal in spite of him.

Minimum Wage

A quick show of hands, please … how many of you have ever worked for 70 cents an hour? Not very many. That’s what I made at my first job as a high school student shelving books in a university library. The minimum wage back then was $1 an hour, but as a student trainee all I got was 70 cents.

By the time I got my next paying job, the minimum wage was up to a buck-and-a-quarter, but I got $2 an hour. That was not because of any generosity on the part of my employer. It was because I had a First-Class Commercial Radiotelephone Operator’s License from the FCC and could legally operate the transmitter at the radio station that hired me.

I’ve never had a minimum wage job. Since that second job, I’ve been overqualified, but for that first job, I was underqualified. Indeed, if the library had had to pay me more that I was worth, I never would have had that first job. I’d have been priced out of the market.

There’s another way to look at the minimum wage. Declaring that there is a minimum price which must be paid for labor has the effect of outlawing labor not worth that much. That can have two effects. One is to keep more low-skill persons who want to work unemployed. The other is to force more workers into the off-the-books economy. Neither strikes me as a good idea.

Homeopathic Economics

Homeopathy is a form of quackery that bases medical treatment on the idea that stuff which makes well people sick will make sick people well. Obamacare is, among its many faults, a form of homeopathic economics.

Consider the effect of the Medical Device Excise Tax on unemployment. It’s a basic principle of economics that if you tax something, you’ll get less of it. That’s one of the justifications for the taxes on tobacco products. So if we tax medical devices, we should expect that the demand for them will go down (to the extent that it is elastic) or that manufacturing will contract because of the increase cost (to the extent that demand is inelastic) creating shortages. Either way, the costs to consumers go up and the need for employees at device manufacturers goes down.

Only an economic homeopath would think that doing something that kills jobs in a good economy will expand employment in a weak economy.

Oh, and the tax has the effect of raising the cost to consumers for medical devices. Again, only an economic homeopath would believe that increasing the cost of goods saves money.

Is it November yet?

This Isn’t Just Coincidence

The Examiner has a study posted on the relative employment recovery performance of states who elected new governors since 2010.

States that elected a Republican governor have seen unemployment drop an average of 1.35 percent. Michigan saw a 2.4 percent improvement.

States that elected a Democrat governor have seen unemployment drop an average of 0.95 percent. New York saw a 0.4 percent increase in its unemployment rate.

The states in the survey with Republican governors are creating jobs at a rate 50 percent faster that states led by Democrats. Almost all of the so-called swing states (except Colorado) are in the R column in this survey. Do you think this may have some effect this November?

Is it 12:01 pm, 20 January, 2013, yet?

Do The Math

Here are the results of President Obama’s recovery programs:

January, 2009 Percent of U. S. Workforce Employed 57.1%
January, 2012 Percent of U. S. Workforce Employed 55.2%

55.2 < 57.1

UPDATE–Mitch Berg has posted corrected numbers for the data above.

January, 2009 Percent of U. S. Workforce Employed 60.67%
October, 2010 Percent of U. S. Workforce Employed 58.5%
January, 2012 Percent of U. S. Workforce Employed 58.41%

While these numbers are a bit higher than the earlier figures, they are, in a sense, worse. October, 2010, was when the unemployment rate peaked. That this January’s number is even worse reflects how many folks have given up looking for work.

58.41 < 58.5