The Up-coming Bout In November: Romney vs Obama

                
                        Imagine:  It's November And Romney and Obama are locked in battle                              

Republicans always hand the presidential nomination to the candidate who is the ‘next-in-line.’” Every observer of presidential politics has encountered this theory. The idea is basically this: Republican presidential nominating contests are governed by a law that, in essence, allows the candidate who is “next in line” to receive the nod: Mitt Romney came in second to John McCain, who came in second to George W. Bush; Bob Dole came in second in 1988, Ronald Reagan came in second in 1976.

If this is true, then Mitt Romney’s nomination was basically inevitable and the other candidates never really had a chance. To mainstream Republican voters, despite their reluctance to accept him, there was simply no plausible alternative. But it is awfully difficult to imagine that a principled, articulate, experienced conservative alternative could not have upended him. It is a testimony to Romney’s breathtaking weakness as a candidate that Rick Santorum, of all people, was able to give him a scare.

Rick Santorum

But the withdrawal of Republican presidential hopeful Rick Santorum from the nomination race leaves Mitt Romney as his party's clear frontrunner and sets up a potentially intriguing battle for the White House in November. If, even 10 years ago, pundits had said the contest for the United States presidency in 2012 would be between a black Democrat and a Mormon Republican, few would have believed them.

In reality, the color of each candidate and his respective religion is likely to be largely irrelevant when the country goes to the polls.

Throughout his presidency, Barack Obama, hostage to potential claims of hypersensitivity and fearful of white voter backlash, has been careful not to highlight overly the delicate issue of race.

Christian Exodus

Mitt Romney has most likely already come to the conclusion the Christian evangelical wing of the Republican Party, which flocked to Mr. Santorum, is a lost cause for him - and that there is more profit for him in the centre ground among moderate independents as yet unconvinced President Obama has earned another term.

The influential factors in the forthcoming contest, which barring an unpredictable and extraordinary event - Newt Gingrich and Ron Paul remain theoretically in the running for the Republican spot - are the state of the US economy, economic fairness, and the contrasting personalities of the two likely candidates.


             

Mr. Romney will make most of his running on the first of these, being a successful and wealthy businessman with a personal fortune estimated at about $US 250 million.

He will be quietly hoping the stuttering economy fails to find a fluent and sustained growth spurt until after the election, thus being able to paint the President as a poor steward in such matters.

He will, likewise, portray the Democrats' redistributive tax policies - on which President Obama has been campaigning - as harmful to the economy and bordering on European-style socialism.

In such matters Mr Romney will have certain handicaps, as the gruelling primaries revealed.

These contests have been fiercely fought, with bitterness and bile writ large. Much was made of the way in which the multimillionaire made his wealth (through his involvement with private equity firm Bain Capital, which in part made its fortunes by closing down businesses and adding to the country's woeful unemployment statistics).

Ranged against him has been a collection of fractious and flawed individuals whose policy platforms and ideologies personify the splintered identity of today's Grand Old Party.

Rick Perry

There was Rick Perry, who stumbled fatally in a debate in which he could not recall which of the Government departments he would immediately shut down.

Michele Bachmann's star rose dramatically and waned almost as pointedly on revelations as to her shortcomings as a candidate.

Herman Cain withdrew after running into "women trouble". Mr Santorum, the darling of the religious right, flirted with such electorally volatile issues as contraception - he is against it.

Mr Gingrich, still running but millions of dollars in debt, flung mud.

So pointed at times was the commentary from some opponents and members of Mr Romney's own party, observers could have been forgiven for repeating an old saying: with friends like these, who needs enemies?

Members of the re-elect Barack Obama team must have on occasion pinched themselves. Then there is the challenger's flat presentational style. Try as he might to inject enthusiasm and passion into his speeches, Mr. Romney strains for effect and seems rehearsed. He has thus far barely sparked the imaginations of Republicans, let alone the undecideds.

With, arguably, an ideal profile for Republican candidacy - rich, white, male businessman - there remains a stubborn feeling he will go to the August convention as the candidate who won his party's ticket by default.

All of which makes him the underdog in the presidential election.

This is not always a bad place to be. President Obama, who will continue to make much of economic disparity and a taxation system that favors rich people, such as himself and Mr. Romney, at the expense of low and middle-income workers, will be wary of this factor. When the campaign proper gets under way, anything could happen.

Finally, a telling note: are all of these next-in-line theorists rushing to declare that, after Romney’s time has come and gone, Rick Santorum will be the next Republican presidential nominee? Do these people think that Chris Christie and Marco Rubio have reason to worry? Of course not. There is no “next-in-line” rule — just a hesitance to nominate upstart candidates and unknown quantities. For a conservative party, that should hardly be surprising — let alone interesting.

Six months is a long time in presidential politics, so, lets keep our fingers crossed and pray that Mr. Romney fares better than what I have him looking like here.

Unemployment Rate Drop: Their Playing With The Numbers Here; Don't Be Fooled

The White House got a boost today from the Bureau of Labor Statistics, which released moderately Positive?, jobs data for November and revised its October and September numbers higher, pushing the official unemployment rate down to 8.6% from 9%, the lowest level in two years.

Here's the Disclaimer: There are roughly 3.9 million LESS jods to be had here in America since the economic recovery of 2009.

The new number resurrects the possibility of unemployment dropping below 8% by election day, the threshold below which Obama’s chances for a second term improve dramatically, if conventional political wisdom is correct. Even the impression of improvement may be enough to boost Obama’s reelection chances, and the spike in consumer confidence earlier this week suggests the trend may be heading that way.

Here's another Disclaimer:  Much of November’s improvement in unemployment came from the fact that the pool of people looking for work dropped sharply as 315,000 Americans left the labor force. The revisions of past months suggest that BLS is missing something. The BLS uses two surveys to gauge the state of employment in America: the payroll survey and the household survey, which canvass homes and businesses separately. The payroll survey gets revised twice as new receipts data and other figures come in. I don't care what anyone say; these figures just don't make sense

Graduates to unemployment

 Employers added 140,000 jobs across most private sectors in November, offsetting continued declines in government employment. Public employee rolls dropped by 20,000, the 10th time in 11 months that state and local government employment has shrunk.

Here’s where they slip up;  The battered construction sector saw payrolls fall 12,000 after losing 15,000 jobs in October. 120,000 jobs were created in November but it takes upwards of 100,000 simply to which is enough to keep the unemployment rate from going up. 

This number of new jobs is not enough by itself to absorb all the new workers trying to entering the labor force and reduce the fraction of people that are currently unemployed. Fuzzy math problem; if  315.000 people stopped looking for work in November and 120.000 jobs were created minus 177.000 jobs lost for the month of November, Then "How is the unemployment rate dropping?" couple that with that 3.9 million jobs gone for good. Do you see it now?

Still, the shadow of the unresolved crisis in Europe continues to hang over the U.S. recovery. If the E.U. fails next Friday to deliver on hints of tighter integration of fiscal and monetary controls, the markets will tank, and rates for borrowing for European banks will spike, increasing the likelihood of a major bank failure. That could become the “Lehman Event” triggering another global credit crisis and potential recessions worldwide.

A new Rutgers University study shows that only 7% of those who lost jobs after the financial crisis have returned to or improved upon their previous financial position and lifestyle. The vast majority in the study's survey say that have diminished lifestyles, with about 15% saying they have seen drastic reductions in their incomes.

And those with less education saw more job losses during the downturn. Even those who landed a job made significantly less than before the Great Recession.

Government workers are getting the boot.

Employees of local and state governments probably have the least reason to celebrate. Whichever direction the unemployment rate moves seems almost irrelevant for them, as governments grapple to close budget gaps and shed workers. In November, the downward trend continued as the public sector lost 20,000 jobs – 5,000 of which came from the U.S. Post Service.

Consider this fact, this rate of job growth is barely enough to keep up with the growth in the working-age population. So we’re not making progress on the backlog of more than 13 million jobless Americans, and another 11 million working part-time who’d rather have full-time jobs.

Retail jobs constituted a third of new private-sector employment in November. Retail jobs tend to be unstable, temporary, and low-paying. Although the BLS is supposed to adjust for seasonal employment (i.e. Christmas), it doesn’t take account of the fact that more and more Americans have been pushing up their Christmas buying to before Thanksgiving. So some of these jobs may not be around very long.

Hourly earnings are down, as are real wages. So to some extent Americans have been substituting lower wages for lost jobs – either by accepting lower wages at their current place of employment, or getting the boot and settling for lower wages elsewhere. A job is better than no job, of course, but a job with a lower wage isn’t nearly as good as a job with at the same or better wage.

Another reason for November’s job growth is that American consumers – whose spending accounts for about 70 percent of the economy – increased their spending. But this can’t continue because, as noted, wages are dropping. They spent more by cutting into their meager savings. Don’t expect this to last.

Finally, there’s the wild card of the rest of the global economy – the European debt crisis and the high likelihood of recession in Europe, the slowdown in China and India, slower growth in developing nations. Some of our jobs depend on exports, which will drop. Others are keyed to the financial sector, which is being hit directly.

champagne For One

Two final wild cards closer to home: The Fed, and Congress. The Fed meets in two weeks to decide on further monetary easing. With today’s report, the odds of easing are down, unfortunately. Believe it or not, several Fed members are worried about inflation.

And if Congress refuses to extend the payroll tax cut and/or unemployment benefits by December 30, it will create another drag on the economy. When people ask me what Congress is likely to do I always say the same thing: The odds are in favor of nothing.

So while today’s jobs report is in the right direction, it’s way too early to break out the champagne.

There Are No Jobs, Go Home

Employers added no net jobs in August, while unemployment rate was unchanged at 9.1 %.” The New York Times blasts: “U.S. Showed 0 Job Growth in August; Rate Stays at 9.1%.” But equally apt would be: “Obama’s reelection prospects nose-dive.” Given that we are, for the first time in 11 months, not creating any new jobs, the outlook for a double-dip recession is real. And, moreover, even if we do not slip into consecutive quarters of negative growth (the technical definition of “recession”), we are certainly heading in the wrong direction. According to Matt McDonald, a former Bush official and now a business consultant, in order to get to 8 percent unemployment by Election Day we would need 270,000 new jobs each month. To get to 8.5 percent we would need to create 215,000 jobs monthly. Just to inch down to 9 percent would require 159,000 jobs every month. But, given Obama's anti-jobs policies, getting back down to 9% will be an impossibility. 

Employment Hopes



Mitt Romney

 Not surprisingly, the GOP contenders pounced. Mitt Romney put out this:
Today’s disappointing unemployment report is further proof that President Obama has failed. President Obama oversaw an economy that created zero jobs last month and that is unacceptable. In order to change the direction of this country, we need to change presidents. Americans need a conservative businessman to get this economy moving again, not career politicians. That is why I am running. Next week, I will lay out my specific plan to put America back to work.”

Rick Perry

A spokesman for Texas Gov. Rick Perry sent out an e-mailed saying: “Today’s unemployment numbers continue to demonstrate the failed leadership of President Obama in turning our economy around and creating jobs. Governor Perry has a track record of job creation and he will continue talking about his ideas to get America working again.”

Jon Huntsman



Jon Huntsman has this: “Two days after I offered a plan with serious solutions that would create jobs and get our economy going, we learn of yet another month with zero job growth. There is no clearer sign that the President has failed and the theatrics around his far-too-late jobs speech tonight demonstrates that he has no real plan to change course. In a country with 307 million people, zero job growth is unfathomable. It’s time for America to compete again and it’s time for a new President.”

Which One Do I Vote For


You do get the sense that anyone of these guys would be better at this than the president. And, in fact, the policy differences among the GOP contenders, I suspect, will be small. It will come down to a contest as to who is the most authentic, the most electable and most capable free-market conservative.

And frankly, if the GOP can’t win back the White House with unemployment at 9 percent, a mammoth deficit and the threat of tax hikes coming from the incumbent president, the party might want to go fishing. It will take skill to mangle this race. That is still, of course, a distinct possibility.