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Job losses shock some as others estimate real unemployment near 12 percent
Fed chariman Ben Bernanke still won’t admit that the United States is in a recession. On the other hand More than once in the past, three consecutive months of job losses have marked the start of a recession. “It is our view that we are already in one,” said Drew Matus, a Lehman Brothers economist, offering a view widely held on Wall Street. The view is also widely held by Main Street. Americans are not stupid. Statistics only count those who did not fall off the back side, still unemployed and without unemployment benefits.
I estimate real unemployment at nearly 12 percent. It is not a number the government wants to see. During the dot.com bust, friends became pizza delivery drivers after once earning six-figure incomes. These were people with three children and nice homes. Technically they are now employed. Also compounding the problem are illegal aliens working in the United States. What happens when they become unemployed? Cash workers who pay no taxes can also be laid off, and those people do not count. Every migrant, vagrant, alcoholic, and day laborer who becomes unemployed simply adds more burden to food stamp or SSI programs.
Some say there was no end to the recession of 2001, as the government allowed mortgage lenders to tap the equity in American homes to stimulate the economy in a false way. In retrospect I tend to agree. It was a failed experiment as evidenced by problems in 2007 -2008. But unemployement numbers – either the government’s or mine – are not experiments. These are real people. If you think $3.50 gasoline and $4 diesel fuel won’t make matters worse you are dreaming. Actually, some workers who cannot afford to drive to work might benefit from getting fired so they can draw unemployement too. But good luck finding another job.
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