Sacramento ‘recovery’ reliant on government growth

Dec. 30, 2012

By Katy Grimes

A front page news story in Sunday’s Sacramento Bee claimed that 2012 “is shaping up as another year of solid but not spectacular economic growth – more groundbreakings, more cars sold, more stores and restaurants opening, and a gradual decline in unemployment.”

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Offering nothing more than provincial anecdotal evidence, the Bee, as most mainstream newspapers, have been selling a bogus economic “recovery,” even as America faces a fiscal cliff.

California will get there first.

Most mainstream newspapers have completely ignored the double-dip recession, staggering state and national debt, growing entitlement crisis, as well as the job killing effects of the implementation of Obamacare. The “recovery” has been largely undetectable  for approximately 90 percent of all Americans.

Even financial experts have said that any recovery from the recent Great Recession has been the weakest of any since 1945.

Yet the story in the Sacramento Bee also included a full admission that President Barack Obama’s economy is fully dependent on borrowing, as well as printing more than a trillion dollars every year just to sustain the weakest economic recovery in decades.

“Until the ‘fiscal cliff’ federal budget impasse is resolved, no one is really sure what 2013 will look like,” the Bee said.

“If you counted all the California unemployed, that number is 1.846 million,” CalWatchdog contributor Stephen Frank wrote. “The rate is not 9.8 percent.  According to the Bureau of Labor Statistics, the U-6 number, a broader measure of unemployment, is 19.6 percent — more than double what Obama and Brown want you to believe.”
I’ve been writing all year about the real unemployment numbers. The Bureau of Labor statistics provides these, but most media ignore the data. it apparently doesn’t fit the “recovery” agenda.

Perhaps the only “recovery” in Sacramento, the state Capitol and state government agency headquarters, is in government jobs. “In June, a total of 142,415,000 people were employed in the U.S, according to the BLS, including 19,938,000 who were employed by federal, state and local governments,” Terence Jeffrey of CNS News reported.

“By November, according to data BLS released today, the total number of people employed had climbed to143,262,000, an overall increase of 847,000 in the five months since June,” Jeffrey reported. “In the same five-month period since June, the number of people employed by government increased by 621,000 to 20,559,000. These 621,000 new government jobs created in the last five months equal 73.3 percent of the 847,000 new jobs created overall.”

The phony “recovery” in California is not only over-reported, but the state’s real debt is never mentioned.”California’s real debt is not just the measly $16 billion that Gov. Jerry Brown and state Democrats bandy about; California’s real debt is $617 billion.,” I wrote in October.“California again trumped other states with a $617 billion debt,”  State Budget Solution reported in August. “California’s debt is more than twice the size of New York’s state debt, and New York has the second largest total debt burden in the nation.”But this fact doesn’t support the recovery” agenda either.

University of the Pacific economist Jeff Michael, predicted for the Bee that “Sacramento-area unemployment should fall to 9 percent by 2014, when he believes the job market will move into a higher gear.”

“One of the X factors is tax rate,” the Bee reported. “Proposition 30, passed by voters in November, raises income taxes on wealthy Californians and sales tax on everyone. In addition, Sacramentans passed their ownsales tax increase, bringing the rate in the city to 8.25 percent.”

In a shock to my system, the Bee actually admitted “higher taxes in general aren’t good for business.” But then they killed that admission. “But in a community like Sacramento – where the public sector accounts for more than a quarter of all jobs – the good likely will outweigh the bad. The extra billions from Proposition 30 will help school funding and shore up the state budget.”

“You’re looking at a millionaires’ tax that’s going to pass through Sacramento in the form of state spending,” Michael said. He clearly is a big government guy who doesn’t see anything wrong with money passing through the government as economic stimulus.

I remember Michael at a Dec. 2011 hearing where he and another university economist promoted creating higher oil taxes, adding more progressive taxes, and called for Proposition 13 to be “revisited.” They said that project labor agreements needed to be strengthened and capital gains and inheritance taxes need to be beefed up.

They never once advocated free-market economic principles during the hearing. Instead, the university economists and Michaels criticized high-income earners and intimated that the wealth was ill-gotten.

It is no surprise that Michaels is the go-to economist for the Bee. He is the go-to economist for state Capitol Democrats as well.

All this story proves is that a Sacramento “recovery” is entirely reliant on government. And that’s never good for the private sector.

13 comments

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  1. Rex the Wonder Dog!
    Rex the Wonder Dog! 30 December, 2012, 20:55

    “You’re looking at a millionaires’ tax that’s going to pass through Sacramento in the form of state spending,” Michael said.
    ==
    It is actually state WASTE and MISMANAGMENT. Bloomberg News just proved that up.

    Reply this comment
  2. jimmydeeoc
    jimmydeeoc 30 December, 2012, 21:06

    All so true, Katy. Depressing but true.

    Don’t get me wrong – I’m not trying to shoot the messenger…..It’s just reality….not the Candy (Crowley) coated CNN version.

    Does ANYONE – other than a few of us kooks – understand that sooner or later, and at the end of the day, the 73.3% proportion of overall job growth that occurred in the PUBLIC sector can only happen when they are funded by the PRIVATE sector?

    We are so hosed……

    Reply this comment
  3. ExPFCWintergreen
    ExPFCWintergreen 30 December, 2012, 21:58

    Government is the only remaining industry in Sacramento, and is the only “industry” city and county politicians are interested in having here.

    Reply this comment
  4. Eric R.
    Eric R. 31 December, 2012, 03:48

    You weren’t expecting any honesty from the MSM, were you?

    Remember, they see Orwell’s Ministry of Truth as a how-to manual, not as a cautionary tale.

    Reply this comment
  5. Douglas
    Douglas 31 December, 2012, 07:06

    73% of new jobs created in the last five months were GOVERNMENT jobs.

    This is true, according to the BLS. 

    ALSO, according to the BLS, since January of 2012, there were 1.62 million new  jobs, and 24 thousand FEWER government jobs. 

    How do you calculate that percentage?

    Why go back five months for a comparison?

    There must be a spreadsheet function that automatically finds the most outrageous stats in any given set of tables. Call it the “cherry picking” formula. I believe David Crane originated this with his “2,000 % increase in pension costs in the last ten years.”

    Citing blatantly misleading “information” like this questions the credibility of the entire article. 

    Reply this comment
  6. David Yates
    David Yates 31 December, 2012, 08:18

    Thank you again Katy; for getting the real new’s out

    Reply this comment
  7. Rex the Wonder Dog!
    Rex the Wonder Dog! 31 December, 2012, 12:44

    Douglas says:

    73% of new jobs created in the last five months were GOVERNMENT jobs.

    THAT IS the problem Dougie, or do you think that is normal???????

    Reply this comment
  8. us citizen
    us citizen 31 December, 2012, 17:52

    Well the only thing the news reported correctly this year was that xmas sales SUCKED big time. That we never came out of a recession. Maybe the media is getting the hint that all of their lies are no longer believable. I can dream cant I? 🙂

    Reply this comment
  9. Douglas
    Douglas 31 December, 2012, 18:50

    No, it is not normal.

    There were 1.625 million new jobs since January 2012.
    There were 24 thousand FEWER government jobs since January 2012.

    Since November, 2008, there are 897,000 FEWER government jobs.

    73.3% is the highest ratio of government to private sector jobs gained, by far, in the entire data set for the 10 year period. So what is so special about “the five months since June”?

    That’s the point. It is cherry picking. It is sensationalism.

    Reply this comment
  10. Katy Grimes
    Katy Grimes 31 December, 2012, 23:41

    Where are you getting your data Doug?

    Reply this comment
  11. Douglas
    Douglas 31 December, 2012, 23:50

    From the BLS charts linked in your article.

    Reply this comment
  12. Douglas
    Douglas 1 January, 2013, 00:00

    Happy new year

    Reply this comment
  13. Douglas
    Douglas 1 January, 2013, 00:09

    I posted this in response to your article of Dec 7 : “Record numbers for govt. employment is no joke”

    It IS a joke, right? There has been a huge decrease in government jobs at all levels.

    THE “73%” is a huge anomaly, caused by who knows what economic factors and exploited shamelessly by CNS “News”.

    Reply this comment

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