Why America is Treading Water

First, the facts. From an article in Barron's magazine:

More than a little shocking to Philippa and Doug (and to us as well) is that private employment today is 2% below where it stood 10 years ago and, as they've noted before, job loss over a 10-year period is unprecedented since the advent of something resembling reliable tallies began in 1890. So far, they point out somewhat grimly, "we've regained just 1.8 million jobs lost in the Great Recession and its aftermath, or about one in five."

Couple this with the fact that incomes are stagnant and you get a population that is struggling to maintain its standard of living. Funny, the actual wealth of the country has increased over the past 10 years by roughly 3% per year (or 30% over the decade) and you can see that all the wealth is flowing to the top.

The US economy is limping. The 2009 stimulus was long ago and no longer supports the economy, so things are limping along:

There were all of 54,000 additions to payrolls last month, far fewer than the Street's consensus of 130,000-140,000 and, more to the point, far fewer than the 220,000 averaged in the prior three months. The unemployment rate edged a tick higher, to 9.1%. The private sector upped its hiring to 83,000, which pales considerably when stacked up against the 244,000 new jobs averaged in the February through April stretch.

The above shows that employment is so weak that the unemployment rate is increasing despite the fact that many, many people have dropped out of the work force, i.e. simply given up hope of getting a job. This is a disaster, but Washington is belly-button gazing with their big fight over the debt ceiling. That is a joke. The real problem is to get the economy moving. That means a stimulus and that in turn means more public debt until the private sector is on its feet. But the politicials -- especially Obama -- don't "get it".