Wall Street Journal: “The U.S. economy added 175,000 jobs in May, signaling the economic recovery remains broadly on track. The Labor Department said the unemployment rate rose slightly to 7.6% from 7.5% in April.”
Federal Reserve officials “have mapped out a strategy for winding down an unprecedented $85 billion-a-month bond-buying program meant to spur the economy–an effort to preserve flexibility and manage highly unpredictable market expectations,” the Wall Street Journal reports.
“Officials say they plan to reduce the amount of bonds they buy in careful and potentially halting steps, varying their purchases as their confidence about the job market and inflation evolves. The timing on when to start is still being debated.”
Kevin Drum: “As near as I can tell, the strategy the GOP’s brain trust came up with after the November election was twofold. First, try to expand its coalition by reining in its tea party excesses and tamping down a bit on its anti-gay, pro-gun, anti-immigrant wing. Second, if that didn’t work–and it was always a long shot–keep the economy in lousy shape so that at least Democrats couldn’t take advantage of their paralysis.”
“So far, it seems to be working. Strategy A, as expected, is on life support. But Strategy B is coming to the rescue. By ending the payroll tax holiday in January and seeing their sequester handiwork take effect in March, Republicans have kept the economy barely dog paddling along.”
The U.S. economy added 165,000 jobs last month, more than the 148,000 gain expected by economists, the Wall Street Journal reports.
The unemployment rate fell to 7.5%, the lowest rate unemployment rate since December 2008.
The Huffington Post reports that a group of Republicans are proposing legislation that could give President Obama “an unintentional assist with disagreeable unemployment numbers — by eliminating the key economic statistic altogether.”
“The bill, introduced last week by Rep. Jeff Duncan (R-SC), would bar the U.S. Census Bureau from conducting nearly all surveys except for a decennial population count. Such a step that would end the government’s ability to provide reliable estimates of the employment rate. Indeed, the government would not be able to produce any of the major economic indices that move markets every month, said multiple statistics experts, who were aghast at the proposal.”
The U.S. economy generated just 88,000 jobs last month, the smallest gain in 10 months, adding to fresh evidence that the pace of hiring has slowed, the Wall Street Journal reports.
The unemployment rate fell to 7.6% because of an unanticipated high number of people dropping out of the job market.
First Read: “Don’t be surprised if this lower-than-expected number puts pressure on Congress to alleviate the sequester cuts.”
The Week: Headed for a slowdown?
Micah Cohen notes that President Obama’s advantage over Congressional Republicans on economic issues “has all but vanished. Public approval of his handling of the economy has slipped, according to polls, and surveys now show that a roughly equal number of Americans favor Mr. Obama as favor Congressional Republicans on economic matters.”
“It is not clear what is causing the decline, but it doesn’t seem to be the actual economy. There are increasing signs that the recovery is accelerating. Recent reports on jobs and housing have been unexpectedly strong. And all the while, the stock market has been bullish.”
Wonk Wire: Finally, signs of a solid economic recovery.
Federal Reserve Chairman Ben Bernanke admits he’s “spoken to the president a bit” about whether he would serve another term but says he feels “no personal responsibility to stay at the helm until the Fed winds down
its unprecedented policies to stimulate the economy,” Bloomberg reports.
Bernanke’s term ends in January 2014.
Wonk Wire: Why Bernanke needs to serve a third term.
Key findings: 72% support federal spending “to put people to work on urgent infrastructure
72% support a “federal jobs creation law that would spend
government money for a program designed to create more than 1 million
Jill Lawrence says President Obama squandered an opportunity in his ABC News interview because he “talked almost entirely in the cerebral, inside-Washington policy and strategy terms befitting two cerebral, inside-Washington strategists and policy wonks. In other words, Obama talked to Stephanopoulos instead of his audience.”
“Analogies and connections and details were missing. The human impact was missing. Even talking points seemed to be missing. I’d also take issue with Obama’s downbeat assessment of whether a grand fiscal bargain is achievable. Don’t we need a little presidential optimism and encouragement at this point? Where’s that yes-we-can spirit?”
The Wall Street Journal estimates the unemployment rate would be just 7.1% without government job cuts over the last three years.
“Federal, state and local governments have shed nearly 750,000 jobs since June 2009… No other sector comes close to those job losses over the same period. Construction is in second worst place, but its 225,000 cuts are less than a third of the government reductions. To be sure, construction and other sectors performed worse during the depths of the recession, but no area has had a worse recovery.”
The latest jobs report shows 236,000 were created last month — significantly more than the consensus forecast.
The unemployment rate dropped to 7.7%, the lowest it’s been since December 2008.
Ramesh Ponnuru: “Today’s Republicans are very good at tending the fire of Ronald Reagan’s memory but not nearly as good at learning from his successes. They slavishly adhere to the economic program that Reagan developed to meet the challenges of the late 1970s and early 1980s, ignoring the fact that he largely overcame those challenges, and now we have new ones. It’s because Republicans have not moved on from that time that Senators Marco Rubio and Rand Paul, in their responses to the State of the Union address last week, offered so few new ideas.”
A new Bloomberg National Poll finds President Obama enters the latest showdown with Congress with his highest job approval in three years and public support for his economic message, while his Republican opponents’ popularity stands at a record low.
Key findings: 55% of Americans approve of Obama’s in office, the strongest support since Sept 2009. Meanwhile, just 35% of the country has a favorable view of the GOP, the lowest since Sept 2009.
In addition, Americans by 43% to 34% say Republicans are more to blame than and Democrats for what’s wrong in Washington.
“White House officials tell me they feel stung by coverage of the
inaugural address. Reporters highlighted the president’s left-leaning
stances on immigration, gun control, climate change and gay and women’s
rights. Obama’s aides argue that he devoted more inaugural address
language to the economy, jobs and the deficit than all other issues
combined. Still, the perception remains that Obama lost focus on the
economy — the top issue in the minds of most voters. So look for an
address Tuesday tilted heavily toward policies pledging action on
joblessness, growing the economy and expanding the middle class, White
House officials said Friday. The other issues will be discussed, aides
said, but there will be no mistaking that Obama’s paramount concern is
Just out for the Kindle: Here’s the Deal by David Leonhardt.
Highly recommended essay by the New York Times columnist which “explains lucidly and with calm authority the mess we are in–and how we can get ourselves out of it.”
Wonk Wire‘s “chart of the day” is especially interesting today.
Charlie Cook: “Immigration and gun control have
dominated the issue agenda for the past few weeks, pushing away, for a
time, the previously dominant worries about fiscal issues and their
impact on the overall health of the U.S. economy. But Wednesday
morning’s news that the economy, as measured by real gross domestic
product, had declined in the fourth quarter of 2012 by one-tenth of a
percentage point–surprising economists who had expected the economy to
grow by 1 percent–brings these issues back to the forefront. In the
third quarter of 2012, real GDP grew by 3.1 percent.”
☑️ Life in the Middle: Marginalized Moderate Senators In the Era of Polarization is available on Amazon. It takes a deep dive into the power of moderates and why we see them behave so precariously.