White House July Jobs Report

Note: 7th in a series on President Obama’s job creation record
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How can you turn absolutely truthful statistics into a fanciful, ruse?

The answer:
First, you have to understand the full truth. Then you carefully hand pick subsets of the full truth and/or mismatch facts to twist them into deception.

That is exactly what Alan Krueger, President Obama’s Chairman of the Council of Economic Advisers, did in an official White House statement on the current condition of the economy of the United States:
The Employment Situation in July” – Alan Krueger, The White House Blog, 8/3/2012

It is despicable when knowledgeable government officials continue to deny reality.

Alan Krueger’s cherry-picked subset of data showing 29 strait months of continuous job growth

BLS Total Employment showing ZERO strait months of continuous job growth

The Truth

You will find that if you dig deep into the numbers, as I have, that literally every statistic quoted by Chairman Krueger is accurate.

He even one ups the official BLS July 2012 Jobs Report by accurately reporting there were, seasonally-adjusted, +172,000 new private-sector jobs created in July.

Krueger’s report is a textbook example of statistical gerrymandering.

The $2,200 Middle Class Tax Increase

CBPP estimates of Bush-era Tax Cuts by Income Level:  Note $1,266 for 2012 incomes between $50K-$70K

First off, Kruger reports that the typical middle class family faces a tax increase next year if the Bush-era tax cuts are allowed to expire. Though it is true middle class families face a $2,200 increase, what is not true is that it is all due to the Bush-era tax cuts as Krueger implies. Kruger mismatches his figures.

According to a July 30th, 2012 report from the liberal-leaning Center on Budget and Policy Priorities (CBPP) the Bush-era tax benefit for those making $50,000-$70,000 a year will be $1,266 in 2012. According to the CBPP, that is 2.3% of their after tax 2012 income.

The median American family income is about $50,000 a year. That means their Bush-era tax benefit is slightly less… around $1,150 this year.

So why does Krueger report a higher $2,200 figure?
Answer: His number includes the payroll tax holiday!

The payroll tax holiday is also scheduled to expire the end of this year. That tax cut is 2% of your income. It is slightly less than half of the tax increase faced by middle class families next year.

The payroll tax pays for Social Security and Medicare. The payroll tax holiday over the last two years has resulted in a loss of about $230 billion in tax receipts to pay for Social Security benefits. Social Security is no longer self-supporting. That $230 billion simply grew the deficit and got tacked onto the national debt.

It is kinda hush-hush, but nobody in DC expects the payroll tax holiday to be extended a 3rd time. Middle class families will experience a minimum 2% tax increase in 2013 even if the Bush-era tax cuts become permanent.

That part Chairman Krueger didn’t tell us… but you can bet your Bibby he knows it!

How 195,000 Jobs Lost Becomes 172,000 Jobs Created!

Its statistical magic!

According to the BLS, total overall U.S. employment showed a seasonally-adjusted loss of -195,000 jobs in July and a real -76,000 jobs lost. The BLS July Jobs Report is a subset of that data. It is only total non-farm employment. That report says +163,000 new jobs were created. That is a big difference.

Krueger takes things one step further, he reports an even smaller subset of the total employment picture. He reports total seasonally-adjusted, private-sector job growth of +172,000.

Krueger’s number suffers these prominent flaws:

  • It is a classic cherry-picked number
  • Private-sector job growth is happening almost despite Administration policies
  • The July seasonal figure greatly exaggerates what really happened in July

Lets ignore “seasonally-adjusted” for a moment. This is perfectly acceptable if your intention is to just compare two adjacent months, like June and July of 2012. Then we can look at the “Not seasonally-adjusted” private-sector job growth report to see what really happened.

Do that and you’ll find the REAL private-sector job growth in July was +27,000 new jobs. That is less than 1/6th of the “adjusted” private-sector growth reported by Krueger. Imagine that!

For my money, when it applies, I’ll take real numbers representing real people over “seasonally-adjusted” ones every day of the week and twice on Sundays.

Public-Sector Job Losses

Chairman Kruger reports a reduction of -485,000 public-sector state and local jobs since an oddly selected date of February 2010. Subsidizing public-sector state and local jobs is a main purpose of the American Jobs Act which Krueger is pushing so hard for in his report.

What he doesn’t tell you is those job losses occurred despite the Administration’s 2009 “Stimulus” package that was specifically designed to save them. That is exactly what the American Jobs Act is proposing to repeat again. You can see how that worked out the first time.

Further, he doesn’t tell you that since President Obama assumed office in January 2009 that Obama has expanded the size of the federal executive branch by +68,000 new jobs. At the same time, public-sector state and local employment decreased by -671,000 jobs due to decreased tax revenues from a stalled economy.

Despite a weak economy, President Obama expanded the size of the federal government.


I could go on and on.

The bottom line is this…
The Chairman of the Council on Economic Advisers knows the facts intimately. Alan Krueger has served as an economist for two Presidents – Clinton and Obama. He is Bendheim Professor of Economics on leave from Princeton.

Chairman Krueger knows he is twisting the facts beyond reasonable recognition.

Yet he and the Administration continue to minimize the extent of this nation’s serious economic problems using bogus statistics and the same old worn out rhetoric we’ve been hearing for three years:

While there is more work that remains to be done, today’s employment report provides further evidence that the U.S. economy is continuing to recover
– Alan Krueger, “The Employment Situation in July“, 8/3/2012

You can’t fix a serious problem if you do not first acknowledge that one exists.


About azleader

Learning to see life more clearly... one image at a time!

Posted on Aug 9, 2012, in culture, economics, Job Creation, Jobs, Jobs Reports, Life, news, Opinion, Politics, Thoughts. Bookmark the permalink. 5 Comments.

  1. Well said, AZ. We are in an ideological war. If we were not, then both parties would be working together to find a solution. The Obama side doesn’t want to find a solution. They want to advance their ideology.

  2. I unfortunately agree… we are in an ideological war.

    You hit the nail on the head… Democrats and Republicans should be working together to find a solution. They are not. 😦

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