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> I don’t believe those who went into this past election taking pride in the unemployment numbers understood that the near-record low unemployment figures — the figure was a mere 4.2 percent in November — counted homeless people doing occasional work as “employed.” But the implications are powerful. If you filter the statistic to include as unemployed people who can’t find anything but part-time work or who make a poverty wage (roughly $25,000), the percentage is actually 23.7 percent. In other words, nearly one of every four workers is functionally unemployed in America today — hardly something to celebrate.
But U6 unemployment is also near a 20-year low[0], as is the poverty rate[1].
[0] https://fred.stlouisfed.org/series/U6RATE [1] https://fred.stlouisfed.org/series/PPAAUS00000A156NCEN
It is even worse if you consider the actual reality. US poverty measures OPM and SPM both underestimates the actual poverty. OPM is set to 3x USDA "low cost" food plan and was created in 1960s. It has only been adjusted for inflation. SPM is better, but is not official.
If you tie poverty as the bottom quartile (adjusted per person + addl. impact of children), you are likely to have a poverty wage of around $32,000 (a bit higher than SPM and much higher than OPM). That makes the functionally unemployed much higher. Add to the fact that your benefits like SNAP have a steep drop-off.. you earn $5 more per hour and suddenly, you lose all the benefits and you can see this in the making.
>It has only been adjusted for inflation.
What else are you expecting? Raises every couple of years for a job well done?
Given the discrepancy in measures—24% vs. 7%—I'm guessing that the "poverty wage" factor is the crucial difference?
The official US poverty definition is about $13k for a 1 person household and $26k for a 4 person household. https://www.govinfo.gov/content/pkg/FR-2020-01-17/pdf/2020-0...
And poverty levels are essentially at record low levels:
https://www.statista.com/statistics/200463/us-poverty-rate-s...
Yeah, let's call their number U7. It seems like it's U6 + those on a poverty wage.
It's a fairly reasonable argument that U6 is a better measure of unemployment than U3. And I'd accept a similar argument for their U7, or the other U7's out there that add people like the discouraged.
But I suspect that their U7 is likely at a 20 year low, just like U3 and U6 are. Which would invalidate their argument, in my opinion.
I think it's extremely unlikely that this team, led by a U.S. Comptroller of the Currency, just messed up something obvious:
The article is pretty clearly politically motivated. Thr argument is XYZ number doesn't capture everything and the absolute number is higher.
Which may be true, but for U3 unemployment that has always been true!
The fact is every unemplpyment metric you look at is at a historical low. So regardless of what they are or aren't capturing they are all better than they've been in decades. In relative terms the economy has been doing well.
The difference is two thing. In 2020 half the world shut down and it caused inflation. Our inflation was also much better handled than most of the developed world. And number two, there is a very strong echo chamber that wanted to convince they country the economy was bad, and they were successful.
I'll have to find the link, but there was a reputable poll right around the election that asked people in all the swing states how the economy was doing. They all rated it poorly. They then asked how the economy was doing in their state, they all rated it well.
Voters in every swing state saw up front with their own eyes the economy was doing well in their states and said so in the poll, but were sure the economy was doing poorly because of what they heard about all the other states. Mission accomplished for the echo-chamber.
The economy is fine, but we are in a gilded age of income and wealth inequality. The 3 richest men in the world increased their wealth by roughly an order of magnitude in about a decade, meanwhile minimum wage hasn't moved in a quarter century.
Those economic gains are not felt by a majority of the population. That was clear by the election, and would be clear to you if you stepped out of your own echo chamber. Nobody wants to hear about U3 unemployment when they can't afford childcare, groceries, medicine, all of which have inflated significantly. For folks who were already living paycheck to paycheck, of which there are many, these explanations are both patronizing and out of touch with the lived experience of most of the population.
Yes, saying "the voters were right" is not really justified by the evidence presented. According to the article, economic reality isn't reflected in the government numbers and has not been for many years. But since the gap was present in both the Biden Administration and the first Trump term, it doesn't explain the voters' preference for Trump. When you factor in the economic impact of the pandemic and the strength of the US recovery, then regardless of the systematic gap the record actually suggests a much better economic record for Biden than Trump.
A more plausible explanation is that the Republicans were able to persuade many Americans that the economic problems caused by the pandemic were the fault of the Democrats. Blaming the other side for historical accident is a tried-and-true campaign strategy, and the pandemic provided a perfect opportunity to put it to use for 2024.
> The article is pretty clearly politically motivated.
Supporting links as to why Politico would do something like this:
https://foreignpolicy.com/2022/01/06/axel-springer-politico-...
https://www.rollingstone.com/politics/politics-news/politico...
I was just amused that a former comptroller of the currency discovered U-6!
"The thing I have noticed is when the anecdotes and the data disagree, the anecdotes are usually right. There's something wrong with the way you are measuring it"
—Jeff Bezos <https://sports.yahoo.com/amazon-ceo-jeff-bezos-explains-2123...>
I think this applies here:
Rule of seven also would seem applicable: https://www.brainbok.com/guide/pm-study-notes/rule-of-seven-...
Look at which way the numbers went under the previous regime.
So be it. But electing Trump to fix the economy is like opting to have the Joker operate on you instead of a competent doctor because you’re sick of incumbent doctors and their shit…
I hope you’re all very rich (you’ll benefit from proposed tax cuts) and don’t have anyone you love dependent on Medicaid …
https://www.aha.org/news/headline/2025-02-12-house-and-senat...
I'd like to point out that 2019 was a very good year for the economy. It worked well the first time, so why not again?
There are two economies. The one inhabited by wealthy owner class (they own homes, stock, have paid off cars and disposable income) their economy is great.
For everyone else it sucked. The metrics tend to focus on the former and ignore the “outlier data” caused by the latter.
The problem is the electorate is angry and impatient. The only way for wages to go up is organizing, unionizing, and to further take advantage of structural demographics compressing the working age population cohort. The only way for prices to go down is a deep recession.
Instead, they believed what someone told them (“I will make prices go down”). And when they get the obvious outcome (price levels remain where they are at, or more inflation with tariffs), they are still going to be mad. Facts and data are no anecdote for bitterness and anger, which has been decades in the making (since Ronald Reagan).
That's been the case for a long time (at least in the Anglo-sphere). What may be different now is how in your face the disparity is.
Didn't they just fail payroll because of the frozen payments from USAID which they said they weren't receiving?
I'm convinced most HN readers only read left-leaning mainstream publications, and they were all funded by USAID.
The statements in the article are as good as impossible to verify, no clear metrics, no formulas, no charts.
Also the pretext that 'voters' vote around 'the economy' is hard to qualify nor quantify.
What's clear to me is that a lot of voters believed someone who repeats things over and over and promises to 'fix' things with zero evidence to show for. It tells us more about effectiveness of repeating, fear mongering and blaming 'the others' than about economics.
> The statements in the article are as good as impossible to verify, no clear metrics, no formulas, no charts.
The author's bio links to https://www.gene-ludwig.com/ which has a number of whitepapers.
> "Also the pretext that 'voters' vote around 'the economy' is hard to qualify nor quantify."
It's not that difficult to Google for poll results:
Pre-election: "As concerns around the state of the economy and inflation continue, about eight-in-ten registered voters (81%) say the economy will be very important to their vote in the 2024 presidential election." (https://www.pewresearch.org/politics/2024/09/09/issues-and-t...)
Post-election: "Among 2024 voters, the state of the national economy and the level of inflation were seen as reasons to support Trump by double digits." (https://navigatorresearch.org/2024-post-election-survey-the-...)
There's plenty of other polling data from the November 2024 election. What is it that people are finding it difficult to quantify or qualify?
Sounds right. I'm in a major university town in SE Michigan. In recent years, apartment rents rose by ~4X the "official" gov't rate of inflation.
Supposedly, the townies and students are diehard Democratic liberals. But especially around campus, voting statistics show Trump getting many more votes last November (and Harris many fewer) than the stereotypes would suggest.
So, having grown up in Ann Arbor, it's pretty clear that's the city you're talking about. Ann Arbor has had a big issue with NIMBY-ism preventing new developments for decades, and that's nothing new. Additionally, the entire city council and mayor are registered "Democrats" but that doesn't necessarily mean that they are progressive - or even if they are, that they care about housing as a primary issue.
70% of voters in Washtenaw County voted for Harris: https://electionresults.ewashtenaw.org/electionreporting/nov...
Compare that to 72% of voters who voted for Biden in 2020. I don't see much of a discrepancy: https://electionresults.ewashtenaw.org/electionreporting/nov...
The inflation rate is an index over a huge number of datasets.
If a single stock I own that is in the S&P 500 has a bad year while the S&P 500 index still goes up it doesn't mean the index is wrong or useless. It means you don't understand the calculation method and purpose of the index.
Are you sure the Socialist party candidate didn't siphon off Harris voters?
I'm not believing one iota of info from the current government, especially as much of existing data is disappearing. The Ministry of Truth (social) is here.
So science has to go underground, reminiscent of the dark ages.
The government has always been the ministry of truth.
This is wildly misleading. You can argue that we should use a different metric, sure, but then you must look at all of history using that metric to compare "the economy now, to the economy before."
The data was not wrong just because you choose to use a new metric. The data would be "wrong" if it was collected in a way that introduced errors.
Story says that the data gathering is good, but interpretations are flawed and have been consistently so for decades.
And then there's this to consider too:
https://www.zerohedge.com/economics/behind-todays-stunning-j...
The government reporting on economic prosperity is a conflict of interest. They print money that the economy sits on. It's their dollar that suffers when people don't believe in it.
This is just the government proclaiming how many boots we've made while everyone walks barefoot.