Employers in the United States added only 69,000 jobs in May, the fewest in a year and not even close to what economists expected. For the first time since last June, the unemployment rate rose, to 8.2 percent from 8.1 percent.That's against a smaller labor force than that just before the financial markets crashed. Overseas, ominous signs proliferate.
The Dow Jones industrial average fell 275 points, its worst day of the year, and for the first time was down for 2012. The Standard & Poor's 500 index is almost 10 percent below its 2012 high, the traditional definition of a market correction.The political finger-pointing has intensified. InstaPundit has a roundup from this morning, as does the Associated Press. Daniel Mitchell gives the national government's stimulus efforts a poor evaluation.
But I suppose the good news is that the United States is not Europe. Government is even bigger on the other side of the Atlantic and many of those nations are in the middle of a fiscal crisis and the unemployment rate averages 11 percent.Yes, but we have an executive branch bent on spending money and providing social services more like Europeans, and an Opposition offering only a rudimentary fiscal stimulus, in the form of not changing the tax rates. And defenders of Our President suggest that he's been practicing fiscal restraint on a scale not seen since Herbert Hoover. Jonah Goldberg questions the basis for that comparison. "Obama took what was supposed to be a one-time emergency expenditure and made it part of the new normal." That's based on a different post from Daniel Mitchell, who also provides a lighter look at the fiscal policy, with links to the more substantive analysis.
You'd think that a large emergency spending bill that prevented wholesale liquidation of dubious assets followed by a large Democratic stimulus package would have, well, stimulated. The stimulus spending as implemented, however, imposed so many constraints on projects as to dissipate much of the effect in process losses. The uncertainty over the future course of federalized health care plus the changes, or not, in the tax code and in spending, have to dampen even the wildest of animal spirits.