Jobs crash endangers Brown budget

by John Seiler | January 10, 2014 12:08 pm

Uh oh. Just a day after Gov. Jerry Brown's budget[1] spending splurge proposal, the latest U.S. jobs numbers [2]came in. Unemployment in December dropped to 6.7 percent, which is good.

But only 74,000 jobs were created, which is really bad. That was way below expectations of 200,000 jobs created.

The Guardian reported[3]:

“Only 62.8% of the adult workforce participated in the jobs market in December, down 0.2 percentage points from the previous month. It was the lowest participation rate – the number of people employed or actively looking for work – since the 1970s.”

Working-age Americans not in the labor force now amount to 92 million, a new record.

This really is a “jobless recovery” — assuming it's even a recovery.

Some economists say the economy still is “growing.” Certainly it still is in some areas, such as technology.

But it also seems that the large new weights on the economy — the Obamacare taxes and regulations, and in California the Proposition 30 tax increase and AB 32 regulations — are preventing the kind of strong jobs growth enjoyed in earlier recessions.

Another problem is the inflationary policies of the Federal Reserve Board, which will be continued when Janet Yellen becomes chairperson in February. Inflation is like cocaine, seeming to bring about euphoria for short time, then causing a crash.

If a crash does occur, the Brown's budget assumptions go out the window. And his illusory “surplus” turns into another $20 billion budget deficit.

Source URL: https://calwatchdog.com/2014/01/10/jobs-crash-endangers-brown-budget/