Editorial: A number to keep Obama up at night
Scripps Howard News Service
The number that President Barack Obama needs to worry about is not two, the number of governorships the Democrats lost on Tuesday. It is 10.2 percent, the unemployment rate for October announced Friday by the U.S. Department of Labor.
Unless the Obama administration can wrestle that rate down, he and his party face serious political trouble next November. The last time unemployment passed the highly symbolic double-digit mark was in 1982, and President Ronald Reagan and the Republicans lost 26 House seats that fall.
Unfortunately for Obama, while the government can affect the markets for, say, housing, credit and consumer goods, the labor market is almost immune to tinkering. He is at the mercy of larger economic forces.
The outlook is not good. Economists say the jobless rate will peak early next year, probably at about 10.5 percent, and then still have subsided only to around 9 percent by Election Day.
While the October jobless rate was officially 10.2 percent, counting those who got so discouraged they quit looking for work and those who want to work full time but have been forced to settle for part time, the rate is more like 17.5 percent, the highest in the 15 years that record has been kept.
Lawmakers are acutely aware of the jobless rate, which can whack incumbents of either party. In a rare act of bipartisanship, the Senate passed unanimously and the House by 403-12 a bill extending another 14 weeks of unemployment benefits to workers who have exhausted theirs, plus an additional six weeks for workers in states with unemployment rates of 8.5 percent or higher.
Counting earlier extensions, a worker drawing the maximum could get 99 weeks, almost two years’ worth, of unemployment benefits. However, the economy has shed jobs for 22 months straight, also nearing the two-year mark.
The irony for the White House is that in the third quarter, ending in October, economic growth returned to its long-standing annual average of 3.5 percent, meaning that the economy bottomed out in the first quarter, when it shrank 6.5 percent, and the recession may well have ended this summer. But if yours was one of the 190,000 jobs lost in October, those positive macro-economic numbers are of no comfort.
The U.S. economy is enormously resilient and capable of great surprise ó but no one is forecasting one.