Friday, March 05, 2010

The giant economy size

Updated So this is what it's come to:
The Labor Department released its employment summary today[, Friday,] and found that payrolls shrunk by 36,000 people in February, with the overall unemployment rate holding steady at 9.7%. In addition, December was revised upwards to -109,000, and January revised slightly downward to -26,000. Experts predicted a larger decrease in payroll, so this figure outperformed those expectations.
That is, the good news is that job losses were smaller than expected. I feel oh so encouraged.

The chart, via the above link at Firedoglake, graphing job loss and recovery for post-World War II recessions, dramatically shows just how bad it is (click on it for a better look): We've experienced the longest, deepest shrinkage in jobs in at least 65 years, one so deep and so long that of the other ten post-WW2 recessions, seven had already fully recovered this long after their start and two more were just short of doing do.

The numbers are disturbing even when you already know what they express. Between March 2008 and April 2009, the economy lost 8.4 million jobs. February was the 25th out of the last 26 months to show a decline in jobs. In 2009, the overall US economy shrank 2.4 percent - the worst year since the end of World War II. And those lost jobs aren't coming back any time soon:
Sizzling growth in the 5 percent range would be needed for an entire year to drive down the unemployment rate, now 9.7 percent, by just 1 percentage point.

For all of this year, the economy is expected to grow 3.1 percent....
Mark Zandi, chief economist at Moody’s, estimates it will take five or six years to get back to prerecession job levels.

And that is based on accepting the official figures, which actually conceal some things: First, because of population and labor force growth, the steady unemployment rate means that more people are actually out of work: The total is just shy of 15 million now. Second, here's a different number:
When both unemployed and underemployed workers are counted, there still are 26.2 million people without full-time work - a 16.8 percent under-employment rate. In fact, the under-employment rate (which includes not just the officially unemployed, but also jobless workers who have given up looking for work and part-time workers who want full time jobs) worsened from 16.5 percent to 16.8 percent.
What's more, long-term unemployment - six months or longer - is the worst since the Great Depression: Some 40% of the unemployed have been without regular work for at least 27 weeks.

Numbers. One in eight Americans now receives food stamps, including one in four children. At the end of 2009, the US Conference of Mayors said cities reported a 26% rise over 2008 in the demand for food assistance, the largest such increase in nearly 20 years. The number of Americans ranked by the USDA as "food insecure," defined as having "limited or uncertain availability of nutritionally adequate and safe foods or limited or uncertain ability to acquire acceptable foods in socially acceptable ways" (i.e., without stealing it or getting the necessary cash illegally), hit 49 million in 2008, a huge 36% increase over 2007. (That from "Hunger in America 2010," a report by Feeding America, which has seen a 46% increase in its client base since 2006. The Executive Summary is here and the full report is here; both are .pdf files. I'm indebted to Richard at American Leftist for the links.)

Numbers. One in 20 households is evicted every year; in mostly black communities the rate is one in ten. Some poor people in more expensive cities are spending 80 or 90% of their income on rent, leaving the prospect of eviction just one unexpected expense away.

Homeowners are faring little better: 860,000 properties were repossessed in 2009. And it's unlikely to get better this year. Nationally,
[m]ore than 11.3 million homeowners - nearly one-fourth of all Americans with a mortgage - owe more on their loan than their home is now worth, according to ... FirstAmerican CoreLogic. ...

The number of underwater mortgages increased by about 620,000 from the third quarter, the firm said. Another 2.3 million mortgages had less than 5% equity in their home, which could be wiped out if home prices fall further.
The National Association of Realtors just reported that pending home sales dropped by 7.6% from December to January and the Commerce Department says that sales of new homes fell by 11.2% between December and January to the lowest total in almost 50 years - making such a further decline in prices quite likely.

In six states, more than 20% of mortgages are underwater; in six more, it's 25%. In California, more than one-third of mortgagees owe more than their house is worth; in Nevada, it's a jaw-dropping 70%. Homelessness, particularly among families and particularly in the suburbs, is increasing.

Numbers. Average weekly earnings fell 0.4% in February. They fell 0.8% (after adjusting for inflation) across 2009.

Numbers. In 2009, bankruptcy filings in 2009 were up 32% over 2008 and are predicted to go higher this year. Filings in February were up by 9% over January and 14% over February 2009.

Numbers. Numbers. The data, the statistics, keep coming. Now, I'm well aware that I said in the previous post that the numbers about the economy "can't express the day-to-day stress" people are experiencing. And that's true. As stunning as the numbers are, and as much as such figures, properly projected in the imagination, might hint at the totality of that stress, they don't really describe what it's like at ground level. But sometimes, just sometimes, there comes a number that says something so clearly that it is like a shout in a library. This, I think, is one such and even though it comes from two months ago, to me it still rings across the whole economic front:
About six million Americans receiving food stamps report they have no other income, according to an analysis of state data collected by The New York Times. In declarations that states verify and the federal government audits, they described themselves as unemployed and receiving no cash aid - no welfare, no unemployment insurance, and no pensions, child support or disability pay.

Their numbers ... have soared by about 50 percent over the past two years. About one in 50 Americans now lives in a household with a reported income that consists of nothing but a food-stamp card.
About a fifth of those people, 1.2 million, are children.

Six million people. Two percent. One in fifty. Statistically, in the neighborhood where I live at least one family, maybe two, are in a condition of having no income, nothing to live on - as in nothing, nil, zilch, nada, goose egg - other than food stamps. I simply can't think about that without getting a knot in my stomach. That's real, that's here and now, and a measure of desperation far deeper than the straightforward fact of unemployment or the statistics about income levels.

Officials are quick to note that for any given family, this may be a short-term condition - but all that means is that for every family that locates some sort of aid or income, another family loses it. I'm not sure how that's supposed to be a whole lot better, especially when, as the same article notes,
tougher welfare laws [have] made it harder for poor people to get cash aid....

The main cash welfare program, Temporary Assistance for Needy Families, has scarcely expanded during the recession; the rolls are still down about 75 percent from their 1990s peak.
Tougher and harder to the point where ColorLines magazine (the link coming here via Democracy Now! via Susie Madrak at Crooks & Liars) reported a couple of weeks ago how poor people are selling their food stamps on the black market in order to have the cash "to pay for the rent, phone bill, detergent and tampons." Bluntly put, and as many predicted at the time only to be dismissed and mocked as doom-sayers by triangulating Democrats, "ending welfare as we know it" has lead to, in the face of economic decline, "expanding poverty as we knew it."

In fact, according to a Brookings Institution analysis, between 2000 and 2008, poverty grew at twice the rate of the population as a whole. In 2008, some 39.1 million Americans lived below the poverty line. Add in the 52.5 million living in households with incomes between 100% and 200% of the federal poverty line, and you have a whopping 30% of Americans surviving on incomes no greater than two times the poverty line. (Thanks to Tim at Green Left Global News & Info for those links.)

And guess what, something else we always knew: The official numbers on poverty were designed to artificially reduce the reported poverty rate, which is actually higher. The government admitted as much on Tuesday, when by ditching a measure based on an emergency food budget in 1955 and adopting a more realistic measure of income and expenses in today's world, the "official" poverty rate jumped from 13.2% to 15.8% - from 39.8 million to 47.4 million people.

Enough numbers. I want to close with two thoughts: First is that the British-style crosswords that appear in The Nation have sometimes made use of a type of pun that is a play on sounds rather than words (I'm sure there's a term for it but I have no idea what it is), giving as a clue something like "quantities of anesthetics" with the answer "numbers" - the pun being that the word can be pronounced two different ways: the obvious one that refers to quantities and the less obvious one that refers to anesthetics, which can make you numb and therefore can be called "numbers" (with a silent b).

Numbers can overwhelm us, making it too easy to intellectualize, to separate ourselves from their meaning, such that they become mere statistics, figures to be parsed and played with but which have lost their connection to flesh-and-blood people. They become anesthetics and so the numbers become... numbers. We have to guard against that every day, every time. Numbers can tell stories, as all these here surely do, but only if we don't just gather, analyze, and recalculate them, only if we don't just read them with our eyes, only if we listen to them with our consciences.

The other thing is that in gathering data for this post, I was struck by a comment made by a columnist at After noting that "it's no wonder" that many American households "are often living paycheck to paycheck," he said:
While many may be tempted to launch a partisan tirade to "explain" these statistics, trends that stretch back decades are structural in nature.
Yes, they are. And that is exactly the problem. But yet again, that is a discussion for another day. Perhaps tomorrow, in fact.

Updated to add more figures on jobs, home sales, earnings, and bankruptcies, obtained via another link at Green Left Global News & Info.

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