Book review “Nomadland by Jessia Bruder

This Friday the Lakeside Women's Club book review is "Nomandland; surviving America in the 21st century" by Jessica Bruder. (2017) I'm about 1/3 finished, but I get the drift. Convince the readers there's something terribly wrong with the USA instead of the poor decisions, divorces, childhoods and investments of selected people interviewed for the book. So far, although the "great" recession of 2008 is noted as a cause for the white collar workers, the underlying factors in many of these cases are divorce, and/or an unhappy, abusive childhood that also included divorce, disruption, and frequent moves. I've been skimming or reading books like this for 4 decades. And since the so-called War on Poverty and the disintegration of households of married couples and families, the discussion doesn't get more positive, but the journalists/fabulists don't seem to catch on.

We first met nomad retirees in 2003 in Glacier Park. They were quite happy with their lives, moving with the tourism industry, northwest in the summer and south in the winter. According to Bruder, this movement has drastically increased as boomers hit retirement age, the internet glamorized it, and Amazon and other suppliers began to encourage a new migrant class of elder workers in RVs, vans and campers.

However, since the 1950s, our culture has glamorized the freedom of the open road, living off the grid, and personal liberty without family responsibilities in our films, theater, TV, literature or even neighborhood gossip. We shouldn't be surprised if a tiny percentage tried to grab this fading brass ring on a merry go round and found it a struggle of clunker RVs and difficult physical labor in warehouses.

So readers have a rich stew of anecdotes sprinkled with statistics about the history of retirement (it's a relatively recent concept). The reader can blame evil capitalists, bad government programs, Amazon, shrinking pensions, and overall malaise.

I'm shocked, shocked that aliens are flooding our borders. They need to read sad best sellers and then they would stay home.

What happened on the way to economic recovery? Was it Obama?

https://www.bostonfed.org/news-and-events/speeches/2016/after-the-great-recession-a-not-so-great-recovery.aspx   This is the link to the summary, and you can open the text with a click.

Shortly before the 2016 election there was the Federal Reserve Bank of Boston's 60th Economic Conference, with president Eric Rosengren exploring what went wrong in the recovery from the recession.  Technically it was over by June 2009, and Obama’s goosing the economy with payouts to special interests and bail outs hadn’t even gotten out the door.

Without ever getting to the heart of it (I personally think it was Obama’s personality and negativity that caused workers and investors to hold back with a wait and see attitude) Rosengren lists

changing demographics

falling labor participation

higher savings rate (imagine complaining that people were holding on to their own money and not buying stuff they didn’t need)

low inflation

even when full employment returned, the economy was sluggish

low federal funds rate

treasury rates low

price to earning ratio for stocks were low

rents were low

rapid appreciation in commercial real estate

capitalization rates were at historic lows

Conclusion:  Recovery was mostly bad news and it may be the new “normal.”

Hmmm.  Maybe not Mr. Rosengren.

President Obama returns

Obama raised taxes during a recession, imposed new regulations, spent billions on unworkable programs, ruined the health insurance of millions, racheted up racism like we hadn't seen in 50 years, paid off our enemies, stabbed our friends in the back, created a vacuum for ISIS, weaponized the FBI and IRS against the American people, turned a blind eye to riots and civil disobedience, sneered at our values and religion, created low expectations to guarantee his success, compromised the press, took over the job of Congress when he didn't like their inaction on immigration, and talked incessantly about himself for 8 years. I welcome him entering the race against Trump--it will remind everyone why Trump won.

Maher is beneath contempt

Bill Maher says he hopes there is another recession just so Trump won't get elected. Obama didn't fix the recession--it was over (June 2009) before his schemes were out the door, yet the economy limped along for 7 years. Many people never did recover their life savings, pension, home or marriage.  Does Bill Maher hate American that much? This is worse than anything Roseanne or Samantha Bee said. Completely disgusting to want to hurt 330,000,000 people just because he hates Trump, but unfortunately, that's how compassionate liberals are. Recessions come along about every 10 years. Bush inherited one from Clinton years. (https://files.stlouisfed.org/files/htdocs/publications/review/03/09/Kliesen.pdf)

https://www.washingtonexaminer.com/news/bill-maher-is-hoping-for-an-economic-collapse-so-he-can-get-rid-of-trump-sorry-if-that-hurts-people

The Great Recession--was it?

The academic definition of a recession set by the Business Cycle Dating Committee of the National Bureau of Economic Research described the last recession as the 18-month period from December 2007 to June 2009. Using the broader definition of the word “recession” as a period of reduced economic activity, it is customary these days to claim the recession as two years,  the period from December 2007 to January 2010--"The Great Recession."  That would give the Bush administration 12 months and Obama administration 12 months.  Obama, however, had Democrat control of both houses his first two years, and Bush was saddled with a hostile Congress his final two years, led by Reid and Pelosi. The Democratic Party controlled a majority in both chambers of the 110th for the first time since the end of the 103rd Congress in 1995  (2 independents voted with Democrats). The Recession was global, but in the U.S. it belongs to the Democrats, with the roots of the housing crisis going back to1977 and the Community Reinvestment Act.

The current struggle to stop tax reform and keep economy busting regulations in place is led by Democrats even today, with a number of anti-Trumper Republicans assisting them out of personal animosity for the president.  The sluggish economy finally lifted in the final year of Obama’s reign with a Republican Congress. Determined and heroic Americans both liberals and conservatives in small businesses and the energy fields began to regain their footing, and the stock marked recovered.

Since November 2016, there has been more hope and change in the economy, something Obama just couldn’t deliver, despite his promises. Trump's detractors say he inherited a robust economy--which is only partially true--the Democrats had forgotten the middle income worker (aka "deplorables" according to Clinton).
http://www.businessinsider.com/the-cra-debate-a-users-guide-2009-6
https://www.marketwatch.com/story/good-news-for-the-president-in-latest-trump-scoreboard-2017-11-03

http://www.peoplesworld.org/article/no-troop-surge-as-110th-congress-gets-to-work-the-call-is-raise-minimum-wage-end-iraq-war/
https://www.cfr.org/backgrounder/impact-110th-congress-us-foreign-policy

Obama's speech to Illinois General Assembly

Obama returned to Springfield, Illinois--a Democrat controlled state with a Republican governor in deep budget doo-doo--to give a delusional speech about how great he is. He takes credit for what President Bush did in 2008 to save the country financially and end the war, he won't accept the blame for the partisanship and meaness in politics when the media have been carrying his water for 7 years and he's refused to work with Republicans, he didn't mention the mess with ISIS and Syria and didn't even give the Republican governors credit for their states' recovery which is where the jobs are coming from. Our fuel prices have gone down not from alternatives like sun and wind, but from fracking, which he strongly opposed.   He visits all the celebrities and unions with his hand out, but scolds Americans for the money in politics. Sigh.

 http://my.chicagotribune.com/#section/-1/article/p2p-85860201/

 http://www.nytimes.com/2016/02/11/us/politics/obama-revisits-springfield-and-his-vow-to-bridge-a-partisan-divide.html?_r=0

 http://www.scribd.com/doc/163852744/Observations-on-the-Financial-Crisis-by-Keith-Hennessey-and-Edward-P-Lazear

Obamanomics failed

Jeff Jacoby writes: Barack Obama claims that the economy, "by every metric," is better than when he came into office. In truth, a depressing array of "metrics" shows an economy that has yet to get back on its feet — notwithstanding the unprecedented sums spent by Washington in the form of stimulus projects, bailouts, and gargantuan budget deficits. This has been the weakest economic recovery in modern times. Seven years in, it's clear: Obamanomics was tried . . . and failed. . . The labor force participation rate — the share of working-age Americans who have a job or are looking for one — has sunk to 62.5 percent, a level not seen since the Carter administration. Since the recession ended, the economy has grown at an annual rate of just 2.2 percent. That is way below average for post-recession recoveries."

http://www.jeffjacoby.com/18338/the-weakest-economic-recovery-in-modern-times

What the Democrat candidates say about a recession that ended in June 2009:

"Our middle class is shrinking," one candidate warned during a debate. "Our poor families are becoming poorer, and 70 percent of us are earning the same or less than we were 12 years ago. We need new leadership."

Another candidate scorned the administration's happy talk about unemployment falling to just over 5 percent. "What they forgot to tell you," he told an audience, "is that statistic doesn't include those people who have given up looking for work, those people who are working part time. Add it all together and real unemployment is over 10 percent."

Economic recovery did more than Obamacare

“The RAND Corporation has published a thorough analysis of Obamacare's effect on health insurance that should have put an end to the Obamacare success narrative. Unfortunately, too many continue to confuse the effect of the delayed recovery with Obamacare. What the RAND study really shows is that employer-based benefits have been restored as jobs have started to come back.

The headline is that 172.7 million people, ages 18-64, are covered in 2015, versus only 155.8 million in 2013. The number of uninsured dropped by 16.9 million from 42.7 million to 25.8 million, falling from 21.5 percent to 13.0 percent of the population in that age group.

However, the RAND survey examines people insured or uninsured at a point in time, reporting changes from September 2013 through February 2015. The good news is the number of people with employer-based benefits increased by 8 million, from 111.9 million to 119.9 million (The total population is adjusted for death, aging and migration over the period.) Digging deeper, it looks like this improvement would have been much higher, but for Obamacare.”

http://healthblog.ncpa.org/economic-growth-improved-health-coverage-more-than-obamacare-did/

What Americans really think about the recovery

According to a Pew Report on what the American public believes has happened in the economy, “72% say that, in general, the government’s policies since the recession have done little or nothing to help middle class people, and nearly as many say they have provided little or no help for small businesses (68%) and the poor (65%). These opinions have changed little in recent years, and differ only modestly across demographic and income categories. There are significant partisan differences in these views, though majorities of Democrats, Republicans and independents say that government policies following the start of the recession have done little or nothing for the poor and the middle class. Similarly, more think household incomes have recovered than did so two years ago. But while 51% say there has been a partial recovery in incomes (up from 42% in September 2013), just 4% say they have fully recovered. About four-in-ten 42% think household incomes have hardly come back from the recession.”

Many believe that banks, corporations, the wealthy have benefited from government policies since the “Great Recession.”  I personally think politicians have said very little about the poor in recent years, and increasingly emphasize the middle class not making progress.  And if they do move ahead, then they complain about a gap.

“The analysis in this report is based on telephone interviews conducted February 18-22, 2015 among a national sample of 1,504 adults, 18 years of age or older, living in all 50 U.S. states and the District of Columbia (526 respondents were interviewed on a landline telephone, and 978 were interviewed on a cell phone, including 559 who had no landline telephone).”

Obama is campaigning again

The President is on the campaign trail for his legacy talking about the economic recovery. This recession recovery has been the slowest on record, and we're still 2 trillion behind where we should be if it had been a normal recovery (recession was over in June 2009). The middle class has gone without a raise for 7 years. The big boost to the economy in 2014 was increased health care spending, now that's something to cheer, and the wallet fattening lower gasoline prices caused by fracking which all his supporters hate. The fat cats are loving the stock market. The rosy economic picture he is painting could continue if Republicans show some backbone, or other body parts, and the Keystone Pipeline gets passed (he's already announced he's going to veto it after 6 years of study) and they stop all the crazy regulations that are holding business and growth back.

http://www.wsj.com/video/obama-speaks-at-ford-motor-co-assembly-plant/E0B6F7C5-FFF2-4819-A466-B689AD5040B4.html

http://www.nytimes.com/2014/01/08/us/politics/obama.html?_r=0

Doing the right thing is expensive, guest blogger Michael Smith

My wife and I bought our perfect house in South Carolina in 2007. Acre lot, backed up to a private golf course, 4000 sq.ft., 3 car garage. In 2008 the market crashed. In 2009, we moved when I accepted a much better job.

We put the house on the market and for two years it sat empty as we tried to sell it. We finally leased it but the lease market was saturated due to so many unsold houses on the market, so the monthly lease payment we received only covered 60% of the mortgage payments. Two years ago we lost our homestead exemption and our property taxes went from $1900 a year to $9200 per year and our insurance doubled from $1400 to $2800 a year.

We kept hoping that the market would rebound but it never has - but we never missed a mortgage payment. In 7 years, we were never even late.

This Friday, I close on the house - finally it is sold. It was the second offer that we received on the house in 5 years.

It sold for $120,000 less than we paid for it, so we lost every dime of equity we had in it. The selling price was less than what was left on the mortgage, so I had to make up $35000 in deficit to pay off the mortgage and with all the fees and prorated taxes and such, to sell my house cost me right at $67,000 out of pocket this week.

And yet I personally know of people who just walked away from houses in similar situations. Of course, they took a huge hit on their credit rating but they don't really seem to care, nor has it visibly affected their lifestyles.

I guess I may just be stupid but I was taught to live up to my commitments. We made a bad decision in 2007 and that decision cost us nearly $200,000 in actual cash - but it was our decision.

We decided to take the painful loss now because I can see no signs that the economy will recover any time soon because of the structural damage that has been done in the past 6 years. It was time to move on before things get worse.

So this is my view of what the President's people call a "recovery".

There is no recovery.

I thank God that we have been blessed with the financial means to survive Obama's "stewardship" of the economy and I have a special empathy for those who are struggling with the same decisions or simply cannot free themselves due to their financial situation.

We are witnessing the worst performance of a post recession economy in our history. In spite of an energy revolution, the US economy can't seem to get up off the mat. Economic policies and regulations matter. Presidents may not control the economy but they at least have the responsibility not to screw them up.

This economy is screwed up - normal capitalistic/free market economies will naturally generate growth on their own but Obama and his merry band of progodytes have ours tied down as sure as the Lilliputians did with Gulliver

Michael Smith lives in Utah and blogs at Rio Norte Line and on Facebook, where this post resides.

Jobless rate holds steady at 6.3%

After reading the butterfly kisses account of the “recovering economy” in the Washington Post (all jobs lost during the recession are back, and oh yes, labor participation rate is the lowest since 1978) I scanned through the comments.  Noticed this realistic one—can’t tell if the writer is left, right or middle, but s/he has obviously lost the rose colored glasses the government economists have been passing out for 5 years.

I think most of us are smart enough not to swallow the government data on job growth, rising home prices, or the brainless comment that "“we’re in the clear for the second quarter,” or any other data they throw at us. We're not as gullible as they think we are...we live in the REAL world, not from their fantasy realm in some ivory tower where they look down their noses at the working classes and fudge the numbers to make their assessments look good. How do they sleep at night?

Wonk blog, Washington Post

Here’s what an Obama recovery with added taxes, regulations, bank bail outs and crazy “cash for clunkers” looks like: 2.5years longer than any other recovery since WWII.

Divots on the golf course and pivots on the economy

"Because Obama speaks with such authority, it often takes several repetitions before I realize that what he’s saying is total nonsense." Caroline Baum, Bloomberg, on his "growing the economy" meme, A User’s Guide to Obama’s Inside-Out Economics, Aug. 7, 2013

He's pivoted again; it's back to the economy. The rich have recovered; the low income not so much. Five years and Obama can't fix it. The recession has been over since June 2009. Truman had a recession, Eisenhower had several, Nixon got a recession, so did Carter, so did Reagan, so did both Bushes, and all were brief and the economy quickly recovered. But then, they didn't try to take over health care and pay back and bail out unions and bankers. You have to go all the way back to FDR's mishandling of the Depression in the 30s, extending it a decade, to find a record this poor.

          

Obama’s floundering economy

Notice the difference between the recession Bush inherited, and the one Obama inherited. It took Bush only a couple of years even with 9/11, although it never got back to the tech boom years of the late 90s. Obama is still floundering, and it may take until 2023 to get back to the Bush levels. Obama continues to punish small businesses and intimidate those who would expand and grow. He decided to tackle health care instead of the economy, and we are sure paying for that.

Worst Multiple-Year Economic Recoveries Since WWII

1) June 2009 - Present: 7.5 percent growth

2) April 1958 - April 1960: 11.7 percent growth

3) May 1954 - September 1957: 13.4 percent growth

4) November 1970 - November 1973: 16.4 percent growth

5) November 2001 – January 2007: 17.2 percent growth

6) March 1975 – January 1980: 23.2 percent growth

7) October 1949 – July 1953: 28.7 percent growth

8) November 1982 – July 1990: 37.3 percent growth

9) March 1991 – March 2001: 42.1 percent growth

10) February 1961 – December 1969: 51.2 percent growth

The Recession was over in June 2009—before the stimulus kicked in—in 2013 he says recovery has begun

If Obama hadn't tried to take over 1/6 of the economy throwing all plans for development, invention and expansion into a free fall, the recession he continues to blame on Bush could have been solved quickly. (Technically, it was over in June 2009, so everything he did after that caused the economy to remain sluggish.)

Do Presidents not learn from history?

Actually, President Obama has learned the lessons from the 1930s Great Depression well.  The Great Depression was extended by FDR who raised taxes each time there appeared to be a fragile recovery.  FDR also campaigned against the high government spending of Hoover (like Obama and Bush), and to this day Hoover is blamed.

By the spring of 1937, production, profits, and wages had regained their 1929 levels. Unemployment remained high, but it was slightly lower than the 25% rate seen in 1933. The American economy took a sharp downturn in mid-1937, lasting for 13 months through most of 1938. Industrial production declined almost 30 percent and production of durable goods fell even faster. Unemployment jumped from 14.3% in 1937 to 19.0% in 1938.

The top tax rate in 1938 was 78% and on capital gains it was 30%. They were 24% and 12.5% in 1929.  Who knows how quickly the country could have recovered if Hoover and FDR had none thrown the federal government into the mix?   Even some of the programs put in place by FDR were declared illegal or ran out, but he launched a “progressive” socialist plan that we have to this day.

http://top-federal-tax-rates.findthedata.org/

The Recession ended--where are the jobs?

"More than 90 percent of U.S. metropolitan areas have failed to recoup the jobs lost during the recession that ended in 2009, a report found, underscoring the slow pace of recovery by urban economies.

Only 26 of 363 U.S. metropolitan areas have seen employment rebound to pre-recession peaks, according to the report, prepared by forecaster IHS Global Insight and released by the U.S. Conference of Mayors today. Nearly 80 areas aren’t expected to see such a recovery for more than five years."

Bloomberg

Unequal Harm: Racial Disparities in the Employment Consequences of Minimum Wage Increases

Increases in minimum wage are very popular with politicians--Democrats run on it, and Republicans don't want to appear to be meanies, so they shuffle along and agree to it. But it is those in the lowest job ranks who get cut first as employers look for ways to save (it doesn't increase their income, you know). When Democrats took over both houses in 2007, it was the first step downward for the coming recession--hit employers hard, then the poor. And most of all, young and black. Unemployment in the current recession is about 25% for young white males without a high school diploma, but 50% for young blacks. But why?

The authors find that they’re more likely to be employed in eating and drinking places–nearly one out of three black young adults without a high school diploma works in the industry. Businesses in this industry generally have narrow profit margins and are more likely to be adversely impacted by a wage mandate. There’s also substantial variation in regional location, as black young adults are overwhelmingly located in the South and in urban areas.

Unequal Harm: Racial Disparities in the Employment Consequences of Minimum Wage Increases | EPI Study

Here's how one small businessman (RV parks in Arizona) handled the problem of a 41% increase in 2 years of minimum wage in a heavily labor intensive business. In his case, it was the retirees who were let go, a trade off of experience for younger, faster, healthier workers.

Worst recession since. . . Carter

But they don't say it that way, do they? Sometimes you hear, twenty-six years, or even "the 1930s." FDR is never blamed for the Great Depression even though it dragged out another 10 years after he took office. Presidents Obama and Reagan both inherited a recession. Reagan's was much worse because he also got inflation in the deal.

"At the end of World War II, from 1945 to 1946, there was a very sharp drop in U.S. output (12.1 percent) as the war economy began its transition to a civilian economy. The deepest and longest-lasting recession the United States has experienced since then began in 1980, when Jimmy Carter was president (the gross domestic product dropped 9.6 percent in the second quarter of that year) and did not end until fourth-quarter 1982, almost two years into the Reagan presidency. There were positive quarters during this almost three-year period, resulting in what is known as a double-dip recession, but GDP did not return to the 1979 level until well into 2003. Unemployment peaked at 10.6 percent in the fall of 1982.

As can be seen in the accompanying chart, both President Reagan and President Obama inherited an economy suffering from a year of no growth, along with rising unemployment. (The numbers are almost identical.) But Mr. Reagan faced a far direr situation in that inflation was in the double digits and the prime interest rate was at 20 percent. In contrast, Mr. Obama inherited an economy in which inflation was falling (in fact, inflation has been close to zero for this year) and interest rates were very low.

A situation in which the number of jobs available is falling is bad enough, but if inflation is also destroying purchasing power, the misery is compounded. In the 1960s, economist Arthur M. Okun created the Misery Index by adding the unemployment rate to the inflation rate. In the 1976 presidential race, Jimmy Carter frequently attacked President Ford for allowing the Misery Index to reach 13.57, even though it was lower when Mr. Ford left office than what he had inherited from the Nixon years. Ironically, four years later, when President Carter was running against Ronald Reagan, the Misery Index reached a record high of 21.98. Mr. Carter had no defense and lost the election. The Misery Index dropped by more than 10 points during the Reagan presidency, the single largest improvement during any president's tenure in the last half-century." Richard W. Rahn, Cato Institute

However, if you are the one unemployed, it's 100% not 10%, and if your retirement funds have been decimated, a 10,000 Dow will take a lot of years to make up what you've lost. And whether or not you voted for the current president, in your heart you know that raising taxes is not the way to grow the economy because it's never worked before. And if you know that, and still support him, then you really don't care that people are suffering.