Quote of the day

Whether here within the university, at think tanks, in the government, in the press, or even working with us in the labor movement, working people need the help of engaged policy intellectuals if we are together going to build an economy that works for all.
Think about the great promise of America and the great legacy we have inherited. Our wealth as a nation and our energy as a people can deliver, in the words of my predecessor Samuel Gompers, “more schoolhouses and less jails; more books and less arsenals; more learning and less vice; more leisure and less greed; more justice and less revenge; in fact, more of the opportunities to cultivate our better natures.” ...
Working people are angry—and we are right to be angry at the betrayal of our economic future. Help us turn that anger into the energy to win a better country and a better world.

From Richard Trumka's (President of AFL-CIO) speech on “Why Working People Are Angry and Why Politicians Should Listen” delivered at Harvard's Kennedy School of Government
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So, is the economy doing better or ...?

Same tea leaves ready by different people yields different results. 
Compare Robert Reich's op-ed in the WSJ with Daniel Gross' essay in Newsweek and you might even think that they are talking about two different planets.  And it is not that either one is a hardcore Republican.  Reich is a lefty Democrat, and Gross always has come across as the DLC Democrat type.
First: here is Gross:

the long-term decline of the U.S. economy has been greatly exaggerated. America is coming back stronger, better, and faster than nearly anyone expected—and faster than most of its international rivals. The Dow Jones industrial average, hovering near 11,000, is up 70 percent in the past 13 months, and auto sales in the first quarter were up 16 percent from 2009. The economy added 162,000 jobs in March, including 17,000 in manufacturing. The dollar has gained strength, and the U.S. is back to its familiar position of lapping Europe and Japan in growth. Among large economies, only China, India, and Brazil are growing more rapidly than the U.S.—and they're doing so off a much smaller base. If the U.S. economy grows at a 3.6 percent rate this year, as Macroeconomic Advisers projects, it'll create $513 billion in new economic activity—equal to the GDP of Indonesia.

Since he wrote this, the DJIA finished the day at 11,006
Reich writes:

Some economic cheerleaders say rising stock prices are making consumers feel wealthier and therefore readier to spend. But most Americans' biggest asset is their homes. The "wealth effect" is felt mainly by the richest 10%, whose net worth is largely stocks and bonds. The top 10% accounted for about half of total national income in 2007. But they were only about 40% of total spending. A vigorous jobs recovery can't be based on 40% of what was spent before the economy collapsed.

 Reich worries about the job losses, and the economy's inability to create new ones, fast:

Since the start of the Great Recession in December 2007, the economy has shed 8.4 million jobs and failed to create another 2.7 million required by an ever-larger pool of potential workers. That leaves us more than 11 million jobs behind. (The number is worse if you include everyone working part-time who'd rather it be full-time, those working full-time at fewer hours, and people who are overqualified for the jobs they're in.) This means even if we enjoy a vigorous recovery that produces, say, 300,000 net new jobs a month, we could be looking at five to eight years before catching up to where we were before the recession began.

Gross, any response to this one?

All well and good, the skeptics note, but we've got a long way to go. To recoup the 8.2 million jobs lost since December 2007, it'll take four years of growth at 170,000 jobs per month. And by definition, it's hard to identify the next transformative economic force—the next steam engine or interstate-highway system. White House economic adviser Larry Summers tells a story about the economic summit in Little Rock after the 1992 election. In the thousands of pages of briefing papers and policy briefs, one word didn't appear: Internet.

I will stop here, before I drive myself crazy :)  Can you imagine how much more incomprehensible this will all become if I added in here a truly economic conservative's analysis as well?

Unemployment: "It's a very cruel game of musical chairs"

The mixed report on unemployment is a measure of how much we are yet to get out of the recessionary hole.

Job seekers are now out of work for an average of 30.2 weeks, or 7-1/2 months, up from a record high of 29.1 weeks the previous month. In fact, the average duration of unemployment has notched new records for the last 10 months in a row.

With more than six job seekers for every job opening, it's not surprising that it's taking that long to find work, said Lawrence Mishel, president of the Economic Policy Institute, a research group based in Washington. "It's a very cruel game of musical chairs."

Jobless recovery: can the economy stand on its feet?

John Cassidy wonderfully and succinctly summarizes the recession and recovery, and notes:

With short-term interest rates at or close to zero, the government running a record deficit, and taxpayers propping up the housing market and the financial system, it is hardly surprising that the economy is growing again. Even a terminally ill patient often responds positively to aggressive medication, for a while. The big test will come when the government starts to remove the meds. Come the new year, the Fed will be eyeing higher interest rates, and it will also be shutting down some of its generous lending programs. The administration, meanwhile, will be talking about fiscal consolidation. Can the economy stand on its own two feet?

That is, indeed, the gazillion dollar question :-(
Already there is talk of continuing with the first time home buyer tax credit, which otherwise would end next month.  Is that a reflection of the thinking that the economy isn't quite ready to stand on its feet?

The future of manufacturing, and American workers

Robert Reich has a fantastic piece on why we ought not to be insanely worried about the loss of manufacturing. Read the entire argument here. An excerpt:

Want to blame something? Blame new knowledge. Knowledge created the electronic gadgets and software that can now do almost any routine task. This goes well beyond the factory floor. America also used to have lots of elevator operators, telephone operators, bank tellers and service-station attendants. Remember? Most have been replaced by technology. Supermarket check-out clerks are being replaced by automatic scanners. The Internet has taken over the routine tasks of travel agents, real estate brokers, stock brokers and even accountants. With digitization and high-speed data networks a lot of back office work can now be done more cheaply abroad.

Any job that's even slightly routine is disappearing from the U.S. But this doesn't mean we are left with fewer jobs. It means only that we have fewer routine jobs, including traditional manufacturing. When the U.S. economy gets back on track, many routine jobs won't be returning--but new jobs will take their place. A quarter of all Americans now work in jobs that weren't listed in the Census Bureau's occupation codes in 1967. Technophobes, neo-Luddites and anti-globalists be warned: You're on the wrong side of history. You see only the loss of old jobs. You're overlooking all the new ones.

The reason they're so easy to overlook is that so much of the new value added is invisible. A growing percent of every consumer dollar goes to people who analyze, manipulate, innovate and create. These people are responsible for research and development, design and engineering. Or for high-level sales, marketing and advertising. They're composers, writers and producers. They're lawyers, journalists, doctors and management consultants. I call this "symbolic analytic" work because most of it has to do with analyzing, manipulating and communicating through numbers, shapes, words, ideas.

Unemployment, geography, and maps

A follow-up to this post on why geography matters, particularly when it comes to issues like unemployment.

Chris Wilson at Slate has an awesome county-by-county mapping of unemployment, and over time since 2007. You will see how the slowly blue (jobs gained) changes to red (jobs lost). It is almost like the spread of infection, from Michigan. No, I am not saying that Michigan triggered job losses. Not at all. But, if one did not know what the data were, then that reader might think something started in Michigan and spread everywhere ..... Wilson writes:

A map of employment gains or losses by county tells the story of how those job losses first struck in the most vulnerable regions and then spread rapidly to the rest of the country. As early as August 2007, for example—several months before the recession officially began—jobs were already on the decline in southwest Florida; Orange County, Calif.; much of New Jersey; and Detroit, while other areas of the country remained on the uptick.

Recession and job losses

Remember Mark Twain's comment on lies, damned lies, and statistics ....?
Compare for yourself the following charts: