The release of the June labor market data marks the third anniversary of the official end of the recession in June 2009. Thus, this is a good moment to look at the single best indicator of U.S. labor market health. As is so often the case, it is also one of the simplest: the employment-to-population ratio. In essence, this tells us what share of the working-age population (16-years old and above) has a job. When the ratio goes up, things are getting better. When it doesn’t, the labor market is not recovering.
Using data from the Office of Management and Budget, this chart shows the amount of real federal dollars spent per capita over the past 40 years. The data clearly highlight that, after adjusting for population and inflation, federal outlays have, with a few exceptions, mostly grown, with a clear increase over the past 12 years.
Money-saving proposals through Medicare reform are a significant issue for the upcoming election. This chart re-examines Medicare costs over time using the most recent data from the 2012 Trustees Report and Congressional Budget Office. Between 1975 and 2011, the number of Medicare enrollees doubled to 48 million, and the real cost per enrollee quintupled.
Compared with non-election years, the number of economically significant regulations submitted for OIRA review more than doubles during midnight periods when control of the White House switches to a different party. The surge is rarely accompanied by an increase in OIRA’s budget or staff. Thus, OIRA can be overwhelmed during midnight periods, resulting in rushed, flawed oversight.
As the chart shows, defense spending has almost doubled in the past year in current dollar terms and will continue to grow in spite of automatic cuts set by the BCA. Clarifying these figures reveals that sequester cuts do not warrant the fears of policymakers who warn about “savage cuts” to the defense budget.
This chart uses data from the Bureau of Labor Statistics (BLS) Employment Tables to show the number of jobs gained during each presidential tenure since 1945. The chart shows the historical record of how presidents rank against each other by number of jobs gained and the unemployment rate.
The largest claimed benefit of energy-efficiency regulations is based on the agencies' presumption that consumers and firms make irrational purchasing decisions and therefore gain when regulations restrict their choices.
One of the things holding productivity back and, along with it, compensation, is rent-seeking. When governments dispense privileges to particular firms, entrepreneurs spend their time asking politicians for those privileges instead of devising new ways to create value for customers. Economists call this activity rent-seeking, and research suggests that it depresses productivity growth.
Compare the size of the tax revenue increase to the total amount of spending, and you will see where the problem lies. Even if the president manages to collect an additional $967 billion by letting some of the Bush-Era tax cuts expire, Washington still has a spending problem.