Summary: The jobs report is a monthly gift for journalists and economists. Packed with numbers — mostly noise, with large error bars, subject to big revisions — it generates a flood of clickbait headlines and confident analysis. Lost in this are the important trends we need to know (aka “old news”, because they change slowly). Here are two of the big ones.
The experts will explain that this news is life-changingly significant, every month.
“June’s job growth was big and important!“
No, the June strong headline number is not important. Like May’s horrific slow growth, it’s probably just noise. More important are the 16 months of slowing job growth (i.e., job growth decelerating from the slow grow characteristic of this recovery). In February 2015 YoY growth in non-farm payrolls was 2.3%. In June it was 1.8%. This drop erased the acceleration of Feb 2014 – Feb 2015 that got economists excited about the big Fed rate increases coming really soon. Normal days were coming again! But they’ve been delayed, again.
“Job growth is slow, but it’s still growth!“
The number of jobs is not the best metric in the New America, with its growth in part-time, un-unionizable, no benefits, no training, disposable employees. A better (albeit, like all economic data, imperfect) measure is the total number of hours worked per month. For the full recovery it tells the same story as jobs: slow growth since the crash (jobs are up a total of only 4.4% over nine years, hours are up 5.3%).
But total hours have been flat for the past six months. (total hours for production and non-supervisory workers has been flat for seven months). That’s a red flag. Gaps like this between similar metrics deserve attention, since they signal that something is happening.
Summary: Here’s one of the best essays I’ve seen about the deeper causes of Brexit, beyond Britain’s elites blaming the ignorance racist proles (which conveniently excuses them of any responsibility). Professor Mark Blyth shines light on the real forces at work, and shows how the US has similar problems. Brexit and Trump are the start of a new era for the West, for good or ill.
“Europe will be forged in crises, and will be the sum of the solutions adopted for those crises.”
— Jean Monnet in his Memoirs (1978). He was one of the architect of the program to unite Europe (see his Wikipedia bio).
Mark Blyth explains the hidden reasons for Brexit
Excerpt from transcript of an interview by Athens Live on 26 June 2016
“Let’s think about it this way: was austerity the policy or was austerity a side effect? What we have found out recently from a paper done by the German business school was that, according to their estimates, a full 95% of the cash that went to Greece ran a trip through Greece and went straight back to creditors — which in plain English is banks. Public taxpayers’ money was pushed through Greece to basically bail out banks…So austerity becomes a side effect of a general policy of bank bailouts that nobody wants to own. That’s really what happened, ok?
“…Why are we peddling nonsense? Nobody wants to own up to a gigantic bailout of the entire European banking system that took six years. Austerity was a cover.
“…If the EU at the end of the day and the Euro is not actually improving the lives of the majority of the people, what is it for? That’s the question that they’ve brought no answer to.
“…I’m very pro-European, but I’m against the euro, so if I still lived in the UK I would have an interesting choice. Now if you look at Larry Elliott in The Guardian, he thinks he should vote for exit because this might be the existential crisis that blows up the euro. Now why would you want to blow up the Euro, because “that would be terrible etc etcetera”. Because the long-term effect of the euro is going to be to drive Western European wages down to Eastern European levels in global competition for export share with the Chinese.
Summary: The news has become stranger since the climate policy debate has decoupled from the IPCC. Ludicrous claims of certain doom and nightmarish futures splash across the headlines, seldom with rebuttals (climate scientists are complicit in their silence). This one-sided flow of “news” will shape public opinion slowly but surely, creating support for bold measures by President Clinton. Activists are panicking the public for political gain.
“I think looking at grief is quite appropriate, as I believe we are facing human extinction”
— Comment by a reader on the FM website.
“The more immediate danger is runaway climate change. A rise in ocean temperatures will melt the ice caps and cause the release of large amounts of carbon dioxide from the ocean floor. Both effects could make our climate like that of Venus, with a temperature of 250 degrees.”
— Nobel laureate physicist Stephen Hawking on “Good morning Britain on NBC News’ U.K. news partner, ITV News in May 2016.
This was reported as “Earth DOOMED by climate change which could burn us alive, warns Stephen Hawking” by Sean Martin in The Daily Express, 31 May 2016.
We have heard this story before. The BBC hinted at it last year; Hawking has said it before. There is no support for this in the IPCC’s reports and little (perhaps none) in the peer-reviewed literature. There are papers clearly saying the opposite, such as “Low simulated radiation limit for runaway greenhouse climates” by Colin Goldblatt el al, Nature Geoscience, August 2013 — Gated. See the press release here. Excerpt…
“The so-called `hothouse’ climate of the Eocene is the most useful constraint for anthropogenic change. With the solar constant 1% less than today and a few thousand ppmv CO2, the mean temperature was 10 K warmer than today. With CO2 and temperature both higher then than we expect in the foreseeable future, this implies that an anthropogenic runaway greenhouse is unlikely.
“…As the solar constant increases with time, Earth’s future is analogous to Venus’s past. We expect a runaway greenhouse on Earth 1.5 billion years hence if water is the only greenhouse gas, or sooner if there are others.”
While peer-reviewed analysis is good, it is obvious that Earth cannot become Venus in any policy-relevant time. See the NASA fact sheets for Venus and for Earth. They explain that…