Ideal Taxes Association

Raymond Richman       -       Jesse Richman       -       Howard Richman

 Richmans' Trade and Taxes Blog



Rise in Initial Unemployment Claims Shows Lack of Economic Recovery
Raymond Richman, 12/6/2012

Unemployment sky-rocketed during the weeks preceding December 1, 2012 as the actual number of initial claims for unemployment compensation filed during the week ending December l, 200012 reached the astronomical figure, during a supposed economic recovery,  of 498,619. As usual the media did not report the actual number of claims, but something they called the “seasonally adjusted” number of claims filed. I can think of no good reason for reporting the seasonally adjusted number of claims filed. Agricultural labor is seasonal; manufacturing items for sale at Christmas may be seasonal and falls in October and November; and retail trade, transport, and related activities rise in November and December. None of those are sufficient to account for the reported seasonal decrease of  25,000 in initial unemployment claims in the week ending December 1 when the actual increase in claims was 139,000.

Jack Welch, former head of GE, wrote a couple of months ago that the Department of Labor report on unemployment could not be trusted. Mark Thoma, writing in support of official statistics in The Fiscal Times, has this to say about official seasonally adjusted statistics:

     Lastly, there is the problem of seasonal adjustment. The statistical agencies do a good job of adjusting for            seasonal fluctuations, but seasonal patterns change over time and seasonal adjustments aren’t always perfect.      These errors get smoothed out eventually, but problems with seasonal adjustment can distort the initial picture      provided by the data. 

This is a view I generally share. But the seasonal data reported for the week ending December 1is in my opinion not to be believed. Coupled with other data, last week’s report of GDP, which showed that private investment in plant and equipment for the third quarter of 2012 was stagnant, we are in for a recession whether or not we “go-over-the-cliff” or not. Growing investment in plant and equipment is a sine qua non for a genuine economic recovery. We are making no economic progress except for oil and natural gas and mobile phones and software and these cannot account for the decrease in seasonal unemployment claims. Investment in wind and solar energy during the past decade has not helped the economy but made it worse; it contributed to the massive budget deficit and to declining overall labor productivity because of its high cost.

Your Name:

Post a Comment:




  • Richmans' Blog    RSS
  • Our New Book - Balanced Trade
  • Buy Trading Away Our Future
  • Read Trading Away Our Future
  • Richmans' Commentaries
  • ITA Working Papers
  • ITA on Facebook
  • Contact Us

    Archive
    Aug 2014
    Jul 2014
    Jun 2014
    May 2014
    Apr 2014
    Mar 2014
    Feb 2014
    Jan 2014
    Dec 2013
    Nov 2013
    Oct 2013
    Sep 2013
    Aug 2013
    Jul 2013
    Jun 2013
    May 2013
    Apr 2013
    Mar 2013
    Feb 2013
    Jan 2013
    Dec 2012

    November 2012
    October 2012
    September 2012
    August 2012
    July 2012
    June 2012
    May 2012
    April 2012
    March 2012
    February 2012
    January 2012
    December 2011
    November 2011
    October 2011
    September 2011
    August 2011
    July 2011
    June 2011
    May 2011
    April 2011
    March 2011
    February 2011
    January 2011
    December 2010
    November 2010
    October 2010
    September 2010
    August 2010
    July 2010
    June 2010
    May 2010
    April 2010
    March 2010
    February 2010
    January 2010

    Categories:
    Book Reviews
    Capital Gains Taxation
    Corporate Income Tax
    Consumption Taxes
    Economy - Long Term
    Economy - Short Term

    Environmental Regulation
    Real Estate Taxation
    Trade
    Miscellaneous

    Outside Links:

  • American Economic Alert
  • American Jobs Alliance
  • Angry Bear Blog
  • Economy in Crisis
  • Econbrowser
  • Emmanuel Goldstein's Blog
  • Levy Economics Institute
  • McKeever Institute
  • Michael Pettis Blog
  • Naked Capitalism
  • Natural Born Conservative
  • Science & Public Policy Inst.
  • TradeReform.org
  • Votersway Blog
  • Watt's Up With That


    Wikipedia:

  • [An] extensive argument for balanced trade, and a program to achieve balanced trade is presented in Trading Away Our Future, by Raymond Richman, Howard Richman and Jesse Richman. “A minimum standard for ensuring that trade does benefit all is that trade should be relatively in balance.” [Balanced Trade entry]

    Journal of Economic Literature:

  • [Trading Away Our Future] Examines the costs and benefits of U.S. trade and tax policies. Discusses why trade deficits matter; root of the trade deficit; the “ostrich” and “eagles” attitudes; how to balance trade; taxation of capital gains; the real estate tax; the corporate income tax; solving the low savings problem; how to protect one’s assets; and a program for a strong America....

    Atlantic Economic Journal:

  • In Trading Away Our Future   Richman ... advocates the immediate adoption of a set of public policy proposal designed to reduce the trade deficit and increase domestic savings.... the set of public policy proposals is a wake-up call... [February 17, 2009 review by T.H. Cate]