The inside the Beltway crowd that exists within and without Washington DC there have recently come two startling discoveries.
They have discovered that unemployment is actually a lot higher than anyone’s been willing to acknowledge. And that economic activity is a lot worse than people think.
And they think the two might be connected.
No kidding: It took all this time for a bunch of high-priced DC economists to figure that out.
But like all things Washington, you have to dig a little bit deeper in order to understand the hidden motives behind policymakers’ sudden burst of clarity.
“In addition to the standard unemployment rate,” said the Atlanta Federal Reserve chief, Dennis Lockhart recently, “I look at broader measures of unemployment that factor in marginally attached workers - people available and wanting a job but not currently looking for a job. Their numbers are about 1 million more today than before the Great Recession."
Yes, and it could go higher if we don’t concentrate on things that make the economy grow other than the money supply.
But don’t look for the Fed to worry about that at all. Their masters inside the government and in the big banks want a higher money supply and accommodative interest rates, even if it hit retirees living on a fixed income hardest.
Because what should really be worrying to the bankers is the broader dislocation that the administration has brought to the labor market by increasing the numbers of part-time workers.
And here they do seem to be concerned, although again, not for the reasons that that you and I would be.
"Another underutilized group are those working part-time but who claim they want full-time employment," said Lockhart. "They currently represent about 5% of the labor force, and that's an unusually high number relative to the official unemployment rate."
Here’s where it really gets sick: While both comments seem to indicate a concern for the plight of the workingman, they are in fact, just cover for keeping interest rates and money supply policies intact so Wall Street can benefit.
Yes, the same policies that have contributed to the worst economic recovery in most people’s lifetimes are really what they are trying to protect here, despite the lips service otherwise.
My suspicions are always heightened when someone from a benighted and enlightened Entitlement class suddenly discovers the “workingman.”
It gets doubly suspicious when two or more of them start to sing out of the same hymnal, as Lockhart and new Fed head Janet Yellen have seemed to do.
Two weeks ago Yellen too announced that she found the plight of workingmen—and women—very hard in America right now.
“Although we work through financial markets, our goal is to help Main Street, not Wall Street,” said the People’s Commissar of Banking Janet Yellen, chair of the largest bank in the history of the world, wholly owned by Congress and the member banks.
And so that means instead of changing our policies, you can expect more of the same-- all in the name of protecting the workingman.
They are going to use our plight—a plight they seemed to forget about for six years—in order to keep supplying Wall Street dope to Wall Street dopes.
I don’t know about anyone else, but with help like this I’d the Fed stop being so accommodative to the needs of Main Street.
Truly, they have done enough for Main Street already.