Why go back to work when you can make more on the dole?

We wondered aloud whether the congressional bailout bill giving the unemployed $600 a week would be a disincentive to return to work for many low-income workers laidoff due to the coronavirus shutdown orders. For many that will mean they will receive more income for staying home than they were getting while working.

The morning paper recently ran an op-ed by a Henderson businessman who calculated that his company was paying employees — now laidoff as non-essential — $12 an hour, but their unemployment benefits amount to about $300 a week plus the $600 a week from the federal government. He said this works out to $22.50 an hour. “So if we keep them on the payroll, they earn $12 per hour, and if we lay them off, they earn $22.50 per hour with no taxes owed. What would you do for your employees?” he asked.

How many would come back to work if his business reopens?

A man in the restaurant business in Oregon has the answer in an op-ed today in The Wall Street Journal. He writes that the takeout and delivery business has worked better than expected and the company started making calls seeking to get former workers to return. “When we asked our employees to come back, almost all said, ‘No thanks.’ If they return to work, they’ll have to take a pay cut,” he writes.

With unemployment and the fed bailout, he calculated that former workers at getting $1,016 a week, or $376 more than he or she made as a full time employee. “Why on earth would he want to come back to work?” he writes. The checks will keep coming until July 31. Reopen?


Why Obama’s executive fiat on immigration might not really help Reid

Reid arrives in Las Vegas on Air Force One (R-J photo)

The hed on the online version of the Sunday follow-up story in the Las Vegas newspaper about Obama’s visit to Las Vegas to tout his executive order waiving the threat of deportation for millions in the country illegally read: “Obama’s Las Vegas trip helps Reid, too.” The hed and subhed in print read: “Obama’s visit start of 2016 campaign: Del Sol speech seen as boost to Reid’s hopes.”

I’m not sure the story itself ever really reaches that conclusion.

Harry Reid himself, when asked whether the announcement might aid his re-election effort, simply said, “We’ll see.”

The story says Reid won 90 percent of the minority Hispanic vote in 2010. How many more votes than that could he possibly get?

The better question may be: How many votes might the immigration ploy cost Reid?

There are no hard numbers I could find on how many black votes Reid got in 2010, but Democratic candidates often get close to 90 percent.

Illegal immigrants, mostly Hispanic, already make up 10 percent of Nevada’s workforce. What might that number climb to as millions as added to the workforce?

According the Economic Policy Institute, in the third quarter of 2014 the unemployment rate for Hispanics in Nevada was 6.8 percent. For blacks it was 16.8 percent and 7.2 percent for whites. Both of those were the highest in the nation, EPI said.

Could black and white employment levels be affected by competition from newly “legalized” workers?

2008 Commission on Civil Rights report found that young black workers are especially affected by legal and illegal immigration.

A summary of testimony by Dr. Gordon H. Hanson, professor of economics at the University of California, San Diego, concluded:

Dr. Hanson’s coauthored research suggested that a 10 percent immigrant-induced increase in the labor supply is associated with a 4 percent decrease in black wages, a 3.5 percent decrease in the black employment rate, and a 0.8 percent increase in the black incarceration rate. This correlation held true in both national and state-level data, according to Hanson. The same data source showed that the effect of immigration on white men also produced a 4.1 percent decrease in wages, but had much less effect on employment and incarceration rates. Thus, wages went down for the skill group generally, but black men lost proportionally more jobs and disproportionally increased in incarceration rates.

Dr. Hanson stated that the economic changes created by the large immigrant inflow from 1980 to 2000 (half of which he attributes to illegal immigration) resulted in a labor supply shock that increased the number of workers in the U.S. by 10 percent, with an increase in the number of high school dropouts in the population by over 20 percent. These adjustments account for about 40 percent of the overall 18 percent decline in black employment rates and 10 of the 20 percentage point increase in the incarceration rate of black high school dropouts over the same period. Dr. Hanson noted that this influx reduced the employment rate of low-skill black men by eight percentage points.

The commission report also noted in that same year the Coalition for the Future American Worker sponsored an ad campaign featuring Dr. Frank Morris, the former executive director of the Congressional Black Caucus Foundation, which says:

So, the question should not be whether this immigration ploy will help or hurt Reid, but whether it will hurt American citizens, black and white? And how will they react at the polls?

Obama bragging about economy while real wages are down

Obama talks about the size of workers’ pay checks while at Northwestern University recently. (AP photo)

Obama is engaging in a bit of sleight of hand.

“This progress has been hard, but it has been steady, and it has been real,” the president said recently. “It is a direct result of the American people’s drive and their determination and their resilience but it is also the result of sound decisions made by my administration. So it is indisputable that our economy is stronger today than it was when I took office.”

Yes, unemployment ticked down to 5.9 percent, though the labor force also shrank as people gave up looking for work or retired.

But what really matters is buying power, and that is stagnant and well below what it was when Obama took office, according to the latest Census figures.

The median inflation-adjusted income in 2013 was $51,939, down $2,120 from when Obama took office.

Obama likes to compare himself to Ronald Reagan, so compare.

When Reagan took office in 1981 that median inflation-adjusted income level was $46,877. When he left office eight years later it was up $4,637.

WSJ graphic

The American worker disappearing like a Cheshire cat

Maybe you heard the news? It will be in all the papers tomorrow.

Cheshire cat

Employers, according to the Bureau of Labor Statistics, added 169,000 jobs in August and the jobless rate dropped to 7.3 percent, the lowest in nearly five years — because those who can’t find jobs have given up and are no longer counted as unemployed. “The proportion of Americans working or looking for work reached its lowest point in 35 years,” AP reports.

Actually, if you apply the unadjusted numbers, it is worse than even that sounds. While 169,000 found jobs in August, there were 621,000 fewer employed people in August than July. And 1.4 million more Americans left the labor force entirely from July through August. If just that one month’s worth of discouraged workers were added to the unemployment rate — much less the millions who have dropped out since the recession ended shortly after Obama took office — the rate would be 8.3 percent.


Those jobless numbers never lie, but don’t always tell the whole story

Yes, the seasonally adjusted unemployment rate in Nevada ticked down a 10th of a point in July from June, from 9.6 percent to 9.5 percent.

“Today’s news, which shows a decline in the unemployment rate, also shows that job numbers have decreased slightly in the last month,” Gov. Brian Sandoval was quoted as saying in Friday’s press release from the Department of Employment, Training and Rehabilitation/

While job growth is up year over year, the release noted, Nevada suffered a loss of 10,200 jobs between June and July.

But an even more telling figure, which seldom gets mentioned, is the decline in the total labor force.

If one were to add the 4,200 who left the labor force between June and July (seasonally adjusted), the jobless rate would be 9.8 percent, up 2 tenths of a point, not down.

If one were to add the 5,300 who left the labor force between June and July (not seasonally adjusted), the unemployment rate would be 9.9 percent, the same as June.

Meanwhile, since July 2012, the Nevada labor force has declined by 10,100. Not exactly a robust recovery.

Employment figures for July from DETR.

Employment figures for July from DETR.

Nationally, the picture is pretty much the same. According to Business Insider, in July the labor force dropped to 63.4 percent, down from 63.5 percent in June. “The civilian labor force decreased by 37,000 to 155.80 million in July, while those not in the labor force rose by 240,000 to 89.96 million,” the report said.

The American Thinker reports, 77 percent of this year’s new jobs are part-time. Tough the national unemployment rate declined to 7.4 percent, more than 250,000 frustrated job-seekers dropped out of the labor force. The U5 and U6 rates of labor underutilization were 8.8 percent and 14.0 percent, respectively, in July. Median household income has fell 4.1 percent in the two years following the recession. The avergae workweek is now only 34.4 hours. Fewer than 50 percent of working Americans hold full-time jobs. Homeowner ship is the lowest in 18 years.

In the face of climate change, the press keeps writing about the weather

In February the L.A. Times reported about the 157,000 new jobs added in January and stated, “The pace of job creation is consistent with moderate growth and could ease concerns that the economy’s unexpected contraction in the final three months of last year was a sign another recession could be near.”

In March the N.Y. Times told us about the 236,000 jobs added in February and reported, “The economy picked up speed in February, creating jobs at a pace that would substantially lower the unemployment rate.”

This past week WaPo reported that a “paltry” 88,000 jobs were added in March and said this clouded previous optimism about momentum in the economy. Of course, there was the sequester to blame.

The press just keeps reporting on the weather without recognizing the climate change that has taken place — economic climate change that is.

Yes, a few jobs have been added, but the economic Ice Age fact is that the labor participation rate has fallen to 63.3 percent, the lowest since 1979, as Investor’s Business Daily reports in its Monday edition, which was delivered to homes Saturday. (Don’t ask me, that’s how they label it.)

To illustrate the point, here is the economic version of the infamous hockey stick chart:

Feel the chill?

Taking a jaundiced view of those rosy employment figures

Review-Journal's gleeful headline today

Review-Journal’s gleeful headline today

You could almost see the AP reporter rubbing his hands in glee as he wrote: “The American job market isn’t just growing. It’s accelerating.”

That was the lede (typesetter jargon for the first paragraph) on the banner story in the Las Vegas newspaper today. It also appeared on The Washington Post website and in countless newspapers across the country.

“Employers added 236,000 jobs in February and drove down the unemployment rate to 7.7 percent, its lowest level in more than four years,” the writer informs.

Mixing stats is almost as bad as mixing metaphors, but everyone does it. I know I have.

You see, the jobs figure of 236,000 is from a Bureau of Labor Statistics payroll survey of businesses and government agencies at more than half a million worksites. But you can’t calculate an unemployment with payroll figures. For that the BLS surveys about 60,000 households to find the population, labor force, employed, unemployed and those not in the labor force at all to come up with the 7.7 percent unemployment rate. A quick guide to this is available online. Both figures are seasonally adjusted.

Jobs growth vs. those not in the labor force. (IBD graphic)

The figures never jibe. The household survey shows an increase of only 170,000 more employed from January to February, not 236,000.

More telling is that the household survey found that from January to February there were 296,000 more people saying they were not in the labor force, though the population grew by 165,000. The labor force itself fell by 130,000.

In the past year 1.7 million have fallen from the labor force, even though the population grew by 2.4 million.

Bottom line: If those 1.7 million had said they were looking for work, the unemployment rate would be 8.8 percent.

Rub your hands with glee over that, Mr. AP writer.

Investor’s Business Daily’s lede editorial today reports “just 58.6% of Americans work today, down from 60.6% when Obama took office. The average over the previous two decades was 63%,” and “the economy is still 3 million jobs below its previous peak. When you factor in population growth, the jobs deficit is more like 10 million.”

Household survey data from BLS

Household survey data from BLS

Seasonally adjusted BLS household data

Seasonally adjusted BLS household data

Maybe its just Harry’s version of the Ghost Dance — to remove almost all people from the land

Perhaps you’ve heard by now how Harry Reid is holding 800 Yerington area jobs hostage so he can placate his environmentalist buddies who would like to wipe every trace of human habitation off the face of the planet.

Rep. Mark Amodei managed to get a bill through the House that would allow Yerington to buy 10,000 acres of BLM land at market value to facilitate development of the Pumpkin Hollow copper mine, but Harry is holding it up in the Senate because he wants to hang a wilderness ornament on the tree.

Harry Reid wants 80,000 acres of wilderness designation in exchange for bill to allow Yerington to buy land and create jobs.

I mentioned it in August and Sherman Frederick mentioned it Sunday in his column in the Review-Journal, but it’s not been widely reported.

“It is not a lot of wilderness area but it is something that is important,” Reid was quoted as saying by the Reno Gazette-Journal. “They cannot think they are going to get this thing and do nothing for the environment.”

It apparently turns out that “not a lot of wilderness area” to Harry is 125 square miles, about the size of the entire city of Las Vegas or about 6 percent of all of Lyon County.

According to an article in the Mason Valley News — “The Only Newspaper In The World That Gives A Damn About Yerington,” but not enough to use its name for its flag — Harry recently suggested (though it is not stated where or to whom) 80,000 acres of what has been called the “Wovoka” area, which the paper says is on the south and east side of the Pine Grove mountain range, should be designated as wilderness as a part of the Yerington bill.


The area seems to be appropriately named for the Northern Paiute who in 1889 claimed God had shown him the Ghost Dance, which would remove all the white people and return the land to the Paiutes. The Ghost Dance soon spread from Mason Valley to Paiutes in Oregon, California and Utah, as well as to the Shoshone, Utes, Cheyenne, Arapaho and Lakota.

The land in question is doubtlessly already under the control of the BLM or one the federal bureaucracies that control 85 percent of Nevada and its use is subject to rules, regulations and whims of federal agents. But wilderness designation would make the land off-limits for the average Nevadan.

The Wilderness Act of 1964 defines a wilderness area as one “where the earth and its community of life are untrammeled by man … retaining its primeval character and influence, without permanent improvements or human habitation, which is protected and managed so as to preserve its natural conditions … has outstanding opportunities for solitude or a primitive and unconfined type of recreation …”

No vehicles, no roads, no trails, no outhouses, no park benches, no trash cans, no power tools, no bicycles, no cutting firewood. Hunting is allowed in season under state law, but if you bag anything bigger than a squirrel be prepared to haul it out on your back.

Ghost Dance

The Mason Valley paper quoted Amodei as saying, “I don’t know how you can hold up (the bill) when it is ready to move on its own merits.” He said any wilderness bill should be separate, backed by the local community and “stand on its own merits.”

But give Harry a place to stand in the Senate with a lever as long as the Senate calendar and a fulcrum of job-desperate Lyon County residents, where the unemployment rate is 15 percent, he can move (or block) mountains of legislation. With no apologies to Archimedes.

Or maybe its just Harry’s version of the Ghost Dance.