[Guest post by DRJ]

In St. Louis today, President Obama talked about too much government spending — he likened it to monopoly money — and jeered at those who say the Administration’s proposal of $20 billion in budget cuts last year is just a spit in the bucket.

It is just a spit in the bucket.

As ABC News reported today, the deficit after the first 5 months of Fiscal Year 2010 is $651 billion, which is on track to meet or exceed the Administration’s projected full-year deficit of $1.56 trillion. $20 billion is just over 1% of $1.56 trillion. I’d say that’s definitely a spit in the bucket.

What’s more, Obama’s “monopoly money” theme is getting old.

– DRJ

[Guest post by DRJ]

President Obama enjoyed today’s “better than expected” unemployment news:

“President Barack Obama boasted Friday that his economic recovery efforts were showing results after the national unemployment rate stayed at a steady 9.7 percent for February.

Obama, touring a small business in Arlington, Va., said that the 36,000 jobs lost last month was “actually better than expected” considering the massive snowstorms that devastated the East Coast.”

Obama economic adviser Larry Summers recently warned February’s snowstorms could distort unemployment statistics. His statement helped spotlight today’s jobs numbers and was a convenient prelude to President Obama’s “better than expected” soundbite.

The Obama Administration is talented at creating messages. Too bad it won’t use that talent to create jobs.

– DRJ

[Guest post by DRJ]

The Congressional Budget Office reports President Obama’s proposed budget will result in almost $1 trillion a year in deficits for the next 10 years:

“The Congressional Budget Office (CBO) said President Barack Obama’s budget would lead to annual deficits averaging nearly $1 trillion for the next decade.

The estimates are for larger deficits than the budget shortfalls expected by the White House.

Annual deficits under Obama’s budget plan would be about $976 billion from 2011 through 2020, according to a CBO analysis of Obama’s plan released Friday.”

The difference in the White House’s projections and the CBO is on the revenue side:

“The independent CBO and Obama expect a similar amount of government spending over the next 10 years — about $45 trillion. But the CBO expects Obama’s policies to bring in $35.5 trillion in tax receipts, less than the $37.3 trillion expected by the White House.

CBO expects fewer tax revenues largely because it expects less economic growth than the White House over the next decade.”

Uncertain times don’t produce job growth or more revenue.

– DRJ

[Guest post by DRJ]

The February 2010 employment report showed 36,000 people lost their jobs and unemployment remained at 9.7%:

“Nonfarm payroll employment was little changed (-36,000) in February, and the unemployment rate held at 9.7 percent, the U.S. Bureau of Labor Statistics reported today. Employment fell in construction and information, while temporary help services added jobs. Severe winter weather in parts of the country may have affected payroll employment and hours; however, it is not possible to quantify precisely the net impact of the winter storms on these measures. For more information on the effects of the severe weather on employment estimates, see the box note at the end of the release.”

However, there was an increase in discouraged workers:

“Among the marginally attached, there were 1.2 million discouraged workers in February, up by 473,000 from a year earlier.”

Remember Larry Summers’ claim that the snow might affect the February unemployment report? Here’s what the BLS note said about that:

“Effect of Severe Winter Storms on Employment Estimates

Major winter storms affected parts of the country during the February reference periods for the establishment and household surveys.

In the establishment survey, the reference period was the pay period including February 12th. In order for severe weather conditions to reduce the estimate of payroll employment, employees have to be off work for an entire pay period and not be paid for the time missed. About half of all workers in the payroll survey have a 2-week, semi-monthly, or monthly pay period. Workers who received pay for any part of the reference pay period, even one hour, are counted in the February payroll employment figures. While some persons may have been off payrolls during the survey reference period, some industries, such as those dealing with cleanup and repair activities, may have added workers.

In the household survey, the reference period was the calendar week of February 7-13. People who miss work for weather-related events are counted as employed whether or not they are paid for the time off.”

So people who missed work because of weather were counted as employed anyway, and people who got cleanup and repair jobs were also counted as employed. I’m not an economist but it sounds like the recent snows may have artificially inflated — not depressed — employment.

– DRJ

[Guest post by DRJ]

House Majority Leader Steny Hoyer (D-MD) admitted today that Congress may have to raise taxes to pay down the deficit:

“Tax increases may be necessary to rein in $12 trillion in federal debt, House Majority Leader Steny Hoyer (D-Md.) said Monday.

Hoyer emphasized the need to reform Social Security and Medicare, but he also made it clear that raising taxes will have to be on the table.

“No one likes raising revenue, and understandably so,” Hoyer said in an address at the Brookings Institution. “But if you’re going to buy, you need to pay.

“If need be, I am hopeful that both parties will agree to look at revenues as part of the solution — not as a gateway to higher spending, but as part of a compromise that cuts spending and balances the budget,” he added.”

It wasn’t everyday Americans who insisted on “buying” (with enormous bailouts) institutions like Fannie Mae, Freddie Mac, investment firms, General Motors, and Chrysler. If Congress wants to spend money, it should figure out how to pay for it first.

So how much will taxes go up?

“To hit the deficit target relying only on tax increases on the rich, as identified by Obama, the income tax rates for those earning more than $250,000 would have to be increased to more than 70 percent, Williams and his colleagues Rosanne Altshuler and Katherine Lim wrote in a Tax Policy Center paper released last month.”

There won’t be many rich people left at this rate.

– DRJ

[Guest post by DRJ]

Everything looks bad on this map but flyover country doesn’t look quite as bad.

– DRJ