The Commons is a weblog for concerned citizens of southeast Iowa and their friends around the world. It was created to encourage grassroots networking and to share information and ideas which have either been suppressed or drowned out in the mainstream media.

"But if the cause be not good, the king himself hath a heavy reckoning to make, when all those legs and arms and heads, chopped off in battle, shall join together at the latter day and cry all 'We died at such a place;' some swearing, some crying for a surgeon, some upon their wives left poor behind them, some upon the debts they owe, some upon their children rawly left. I am afeard there are few die well that die in a battle; for how can they charitably dispose of any thing, when blood is their argument? Now, if these men do not die well, it will be a black matter for the king that led them to it; whom to disobey were against all proportion of subjection." (Henry V, Act V, Scene 4)

Monday, November 06, 2006

Joplin Globe Guest column: Stay this course? What for?

Guest column: Stay this course? What for?

By Wm. Gerry Malan

Globe guest columnist

Last week, President Bush attempted to distract American voters from the disaster in Iraq by framing his main strength as the “robust” economy.

As evidence he claimed the following: The creation of 6.6 million new jobs, the 4.6 percent unemployment rate, increased federal revenue growth and rising personal income. Unfortunately, he neglected to put any of those statements in their proper context. Because you are not alone in wondering which part of the country these wonderful things must be occurring, let me explain.

There are fewer jobs than there were in 2000. If one starts adding and subtracting the employment, hours and earnings data on the U.S. Bureau of Labor Statistics site since this administration took office until August this year, the net new jobs are 3,124,000, not 6.6 million. Why? Because 3.476 million existing jobs were lost during the same period! To put this in context, since the GOP gained the White House, actual new jobs have averaged 950 per state per month.

As for the unemployment statistics, it is important to remember how that system works. You must have several years of qualifying payroll employment, not in 1099 or self-employed jobs. Then you must be laid off to qualify. If you are fired, or quit for any reason, you forfeit your benefits. It stands to reason that unless you are eligible, you will not apply. Since the system only counts the number of people applying in a given month, it is logical that the official unemployment rate will continue to decline as fewer and fewer people find qualifying jobs.

All of the federal revenue growth in the past two years has been from two sources: taxes on insider stock sales and taxes on real estate sales. Federal tax revenues are actually the lowest as a percentage of Gross Domestic Product than they have been since 1942. With national home sales off 22 percent in the past 12 months, delinquent mortgages (over 30 days late) soaring 770 percent since December 2005, and home values falling in every area of the country for the first time in history, it is apparent that real estate will no longer make a positive contribution to the economy.

While payroll amounts are up 2.6 percent in the past 12 months, all but 0.5 percent of the increase went to exempt managerial and executive employees. Family income, a much better indicator of reality, is down overall by 1.2 percent. Economic growth has effectively ceased for all but the fortunate few. We need a major course correction to keep us out of the economic dustbin of history.

Wm. Gerry Malan lives in Shell Knob. Before moving back to the Ozarks, he was a commercial banker, retirement plans manager for a major New York Stock Exchange broker, and the chief market economist for a national commercial realtor.


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