The Bad News On Unemployment

CONSERVATIVES are anxious to see bad news in the drop in the headline unemployment rate to 8.5 percent. Yes, it’s fabulous that employment is finally turning upwards, but the labor force isn’t expanding as it should in a healthy recovery. The following two charts using data from the Household Survey from the Bureau of Labor Statistics show the problem. Here is the trend in Employment.

It looks pretty good, finally. But here is the trend in Labor Force, i.e., the total of people with jobs and those looking for jobs. Not good at all. Compared to the so-called “jobless recovery” of the Bush years, it’s pathetic.

We know why the labor force isn’t expanding, and it isn’t because the baby boom is retiring. It’s programs like 99 month unemployment benefits and relaxed eligibility for disability.

Everyone wants to be compassionate to people that have lost their jobs but, as we know, government doesn’t do compassion. Government is force. The reason that the politicians passed the 99 month limit on unemployment is that, to them, it’s a cheap way of forcing the unemployment rate down. Give people money to keep them from looking for a job and they won’t get counted in the Labor Force.

Unfortunately, the experts tell us, long-term unemployment is harmful to workers, because people start losing job skills the moment they stop working.

As promised, the president is working to make the US more like Europe.

In many European countries, the total of people of working age on unemployment, welfare, or disability never drops below 15 percent of the workforce, even in the good times. This started during the 1980s when the recessionary aftermath of the inflationary 1970s when politicians were desperate to “do something” about sky-high unemployment. They did it by relaxing the qualifications for disability benefits.

In Britain, the disability program for working-age folks is called “incapacity benefit.” The welfare state underclass call it “going on the sick.”

In the US the disability rolls have been expanding rapidly for 20 years since the eligibility rules were relaxed in the 1990s. Back in 1985 the disability rate was 2.2 percent. In the mid 2000s it was four percent, and was expected to top out at seven percent of 18 � 64 year-olds. I’ve got a nickel that says it will hit 10 percent after we are done with Obamanomics. Here are links to several articles about the problem.

Of course, disability is just one component of our era’s great moral problem that will end up as divisive as the plantation slavery question of two hundred years ago. It is the program of cultural desertification that liberal politics has visited upon the lower orders.

To be fair to our liberal friends, let us revisit why they built the welfare state. Labor inspector Helen M. Todd explained “Why Children Work” in McClure’s a century ago in April 1913 (H/T Instapundit). Why did children work? Because their fathers were dead or disabled. You can see that it’s a short step from there to Aid to Families with Dependent Children, the Great Depression era program that gradually morphed into today’s vast entitlement state. But here’s the kicker in Todd’s article. The immigrant children she interviewed in her work mostly preferred work to going to school. They hated school because the teachers treated them like morons. Instead of a regular paycheck that their families appreciated they got lousy report cards that got them in trouble.

(Oh really? You mean to say that the public schools were doing a lousy job of educating immigrant children 100 years ago and they still haven’t figured it out?)

The problem is that all this liberal compassion, paid for with our tax dollars, leads to my favorite chart: the stats on children living with one parent.

Things are pretty good in America for the college-educated upper-middle class. Upper-middle class children get to live in two-parent families. And why not? The educated upper-middle class is the ruling class and the whole point of a ruling class is to make things comfy for the ruling class.

But for “other” Americans things are not so good. “Everybody knows” that these “other” Americans are uneducated bitter clingers that really aren’t educated enough to run their own lives. But there is a danger that, in the aftermath of yet another Great Crash cock-up by the ruling class, they might get fed up with their educated and enlightened rulers.

Some people define our present form of government as an “ineptocracy.” But they are wrong. Our modern rulers are extremely adept when it comes to looking after themselves and their immediate supporters. They are only “inept” when it comes to looking after the rest of us: little things like our education, our welfare, our health care, our money, our retirement savings. And what ruling class ever got its knickers in a twist about that?

A government that manipulates unemployment insurance and disability policy to get through the next election is going to do the same thing with education, health care--even national defense.

Christopher Chantrill blogs at www.roadtothemiddleclass.com. His Road to the Middle Class is forthcoming.

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The Bad News on Unemployment

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