# The Jobless Recovery, So Called

Agora Financial’s Founding Father Bill Bonner, writing in his Daily Reckoning, says there are approximately 131 M jobs in the USA.

Justice Little, Editor of Taipan Daily, also out of the AF stable, says that 26 M jobs have been lost.

The Federal Government says that the unemployment rate is 9.8%.  Traditional methods of accounting make the answer right at twice that much, recognizing that people are still jobless even though they have exhausted (expanded) unemployment compensation or been on the rolls more than six months.

Another source claims one million jobs were lost last month, as opposed to the government reports which will fluctuate for a while and finally show up on the back pages as 475,000 again, at a good guess.

Rocket scientists used slipsticks and Cray computers which have been replaced by fancier models, while split second “trades” are executed algorithmically on the floor of the stock exchange to garner half a cent a share, but let’s get back to good old tried and true methods which don’t even require an abacus.

If there are 130 M jobs, net, in the USA (rounding slightly to keep the arithmetic simple), and 25,000,000 have been lost (again, rounding to keep matters simple) then we can either say that the job market has shrunk on the close order of twenty per cent. (a ploy the government should have thought of but didn’t, and if we go with 26 M that is precisely 20% of 130M), or we can say that the jobless rate is approximately twenty per cent., which is exactly the same result I got when I told you in the second paragraph what the true rate probably is.  Inconvenient truths do not really disappear just because someone mumbles mystical new accounting parameters.

It is possible that the wizards were trying to tell us that there are currently 131M jobs in the USA, down from a previous high of 157M.  In that case, the job loss is 26/157 which is an awkward number to reduce by division while typing, so let’s multiply, instead.  The figure is one-sixth, almost exactly.  (6 x 26 = 120 + 36 = 156.  That is definitely close enough for government work.)

By that view, 15% + 1.66% (a quick way to deduce 1/6, since multiplication is far simpler than its upside down view, division.  Perhaps no one ever told you that, or that addition is only backwards subtraction.)  = 15.66 % total destruction of the portion of the economy known as employment.  That is even worse news than that 20% of those who need jobs can’t get them.  It means that a sixth of our economy has disappeared to foreign lands or been destroyed by the fall of the stock market, banking instutions, and real estate.

Even a large factory starting up isn’t going to produce more than a few thousand jobs (and it is not guaranteed to succeed, particularly with such horrors as cap and tax, more regulation, and the guarantee of many other new taxes ahead of us), and who has the capital for such an undertaking, other than foreigners with a surfeit of falling dollars?  Do we really want an economy dependent upon the good will of those chortling over the demise of the dollar as the reserve currency?  I guess assorted governments in Washington this century shouldn’t have borrowed so much money from them.  They did, though, and in some ways the best thing that could happen is for the whole sleazy fraud of fiat currency and the Fed to crash around their deserving ears.

It is possible to jigger figures in any number of entertaining ways, but that won’t change the facts.  All it does is disguise them and lead to more palatable annual corporate reports and soothing statements from Bernanke, Geithner, and Obama.  If our measure of “recovery” is getting back to the slippery ground we were on five years ago–not a pleasant place to stand, as events have revealed–then it follows that 25,000,000 jobs must be created, one or a few at a time.  These cannot be temporary jobs, such as census workers or seasonal workers; that is the equivalent of putting a bandaid on a ruptured appendix and saying that time will heal it.  Time is going to cause us to bleed out and die of septicemia if we don’t do some surgery, here.

Mind, all creating twenty-five million real jobs in manufacturing, construction, agriculture, and education would do is restore the status quo ante.  As daunting a task as that would be, it would not solve the problem; it would merely stanch the bleeding.  Until we work our way through the devastation of all the bubbles there is no way to clear the decks for rebuilding.

I don’t think it can be done.  I’m feeling nautical, so let’s say that we have been hulled between wind and water.  Our masts are down in a tangle of rigging, the sheets are snapped and tangled, and our lower decks are awash in blood and loose cannons rolling over the wounded.  All the surgeon has in his chest is salt and rough canvas.  In this case, Geithner and Bernanke are terrified of using the bone saw.

Oh, occasionally the Captain and senior officers will throw a bank overboard, but pretty much the fix is in for those who are connected.  We are witnessing the greatest transfer of wealth in the last two hundred and 233 years, and it is all going to special interest groups.  Other than what they dole out on luxury goods and buying more power that money is not going back into the economy to create new businesses or expand old ones which is the only way that genuine, long-lasting, productive jobs come into being.

Can there be a recovery without jobs?  Of all the idiotic suppositions that only Keynesians would promulgate!  Of course not, any more than those who are not employed can pay bills, eat, and provide tax recovery.

Jobs are not an intangible, save in one increasingly dangerous sense.  Jobs must produce something.  By its very definition, a job is labor which produces something the employer wants more than he wants or needs his money.  It always seems to surprise Statists, but the purpose of business is to create profits, not to create products, and certainly not to create jobs; indeed, technology is reducing the need for human workers, to the understandable delight of entrepreneurs.  Creating profits involves risk, forethought, knowledge (or hired experience), and it isn’t something just anyone can do.  In particular, it is not something which can be done under shackling regulations, increased taxes and cost, insecurity over fuel availability, and capricious governments dedicated to non-science and paying off themselves and open-handed constituents.