December payroll employment rises (+155,000); unemployment rate unchanged (7.8%)

[mahatmakanejeeves]

Last edited Fri Jan 4, 2013, 01:44 PM - Edit history (2)

Source: U.S. Bureau of Labor Statistics

December payroll employment rises (+155,000); unemployment rate unchanged (7.8%)

....
Establishment Survey Data

Total nonfarm payroll employment increased by 155,000 in December. In
2012, employment growth averaged 153,000 per month, the same as the
average monthly gain for 2011. In December, employment increased in
health care, food services and drinking places, construction, and
manufacturing. (See table B-1.)

Health care employment continued to expand in December (+45,000). Job
gains occurred in ambulatory health care services (+23,000), in
hospitals (+12,000), and in nursing and residential care facilities
(+10,000). In 2012, health care employment rose by 338,000.

In December, employment in food services and drinking places rose by
38,000. In 2012, the industry added an average of 24,000 jobs a month,
essentially the same as in 2011.

Construction added 30,000 jobs in December, led by employment
increases in construction of buildings (+13,000) and in residential
specialty trade contractors (+12,000).

In December, manufacturing employment rose by 25,000, with small gains
in a number of component industries. In 2012, factory employment
increased by 180,000; most of the growth occurred during the first
quarter.


Read more: http://www.bls.gov/news.release/empsit.nr0.htm

---

Good morning, Freepers and DUers alike. I especially welcome viewers from across the aisle. You're paying for this information too, so you ought to see this as much as anyone. Please, everyone, put aside your differences long enough to digest the information. After that, you can engage in your usual donnybrook.

If you don't have the time to study the report thoroughly, here is the news in a nutshell:

http://www.bls.gov/news.release/jec.nr0.htm
Commissioner's Statement on The Employment Situation

What is important about these statistics is not so much this month’s number, but the trend. So let’s look at some earlier numbers.

From The Wall Street Journal. of January 4, 2013:

http://online.wsj.com/article/SB10001424127887324374004578221291910741394.html
Economy Adds 155,000 Jobs



ADP, for employment in December:

http://www.democraticunderground.com/1014354896
U.S. Economy Added 215,000 Private-Sector Jobs in December, According to ADP National Employment Report

BLS, for employment in November:

http://www.democraticunderground.com/1014328849
November payroll employment rises (+146,000); unemployment rate edges down (7.7%)

ADP, for employment in November:

http://www.democraticunderground.com/1014326586
U.S. Economy Added 118,000 Private-Sector Jobs in November, According to ADP National Employment Rep

ADP, for employment in October:

http://www.democraticunderground.com/1014286714
U.S. Economy Added 158,000 Private-Sector Jobs in October, According to ADP National Employment Report

BLS, for employment in September:

http://www.democraticunderground.com/?com=view_post&forum=1014&pid=256565
U.S. Economy Added 114,000 Jobs In September, Unemployment Falls To 7.8%

and

http://www.democraticunderground.com/?com=view_post&forum=1014&pid=256816
U.S. Bureau of Labor Statistics - The Employment Situation - September 2012

The charge was made that September’s BLS numbers were cooked. A fellow who used to head the BLS says this is not possible.

Impossible to Manipulate Labor Survey Data — Former BLS Head
http://blogs.wsj.com/economics/2012/10/05/impossible-to-manipulate-labor-survey-data-former-bls-head/

By Geoffrey Rogow

Even if the U.S. government wanted to manipulate monthly jobs figures, it would be impossible to accomplish, said a former head of the U.S. government’s labor statistics agency.
….

But, Keith Hall, who served as Commissioner of the Bureau of Labor Statistics from 2008 until 2012, said in an interview Friday that there is no way someone at the agency could change any of the data from its two monthly employment surveys. The significant improvement in the unemployment rate may reflect normal statistical errors in the sampling process, he said, but that has nothing to do with manipulation.
….

Mr. Hall said the inconsistent reports reflect the different samples used in the two surveys, one focused on households the other on businesses. The establishment survey has a huge sample size of 141,000 business and agencies covering 486,000 worksites, whereas the household survey covers just 60,000 homes.

“The household survey is much smaller. When you look at something like labor force and employment levels, the uncertainty of those numbers is much larger,” said Mr. Hall. “Within two months, the household survey could show the unemployment rate eking back up.”
….

–Eric Morath contributed to this article.

ADP, for employment in September:

http://www.democraticunderground.com/1014254238
U.S. Private-Sector Employment Increased by 162,000 Jobs in September, According to ADP

BLS, for employment in August:

http://www.democraticunderground.com/1014221739
August payroll employment rises (+96,000); unemployment rate edges down (8.1%)

An increase of 96,000 is really lackluster. It's not just lackluster, but, as the first response says, "disappointing." It's half the ADP estimate. Here is a quote from yesterday's ADP news release:

August 2012 Report

Employment in the U.S. nonfarm private business sector increased by 201,000 from July to August, on a seasonally adjusted basis. The estimated gain from June to July was revised up from the initial estimate of 163,000 to 173,000. Employment in the private, service-providing sector expanded 185,000 in August, up from 156,000 in July. Employment in the private, goods-producing sector added 16,000 jobs in August. Manufacturing employment rose 3,000, following an increase of 6,000 in July.

ADP, for employment in August:

http://www.democraticunderground.com/1014220380
The ADP National Employment Report August 2012

BLS, for employment in July:

http://www.democraticunderground.com/1014184289
July payroll employment rises (+163,000); jobless rate essentially unchanged (8.3%)

ADP, for employment in July. I heard an estimate earlier this morning that the growth in employment would be on the order of 100,000.

The ADP National Employment Report July 2012

BLS, for employment in June:

http://www.democraticunderground.com/1014160067
Payroll employment continues to edge up in June (+80,000); jobless rate unchanged (8.2%)

Of particular importance for the BLS estimate for June was this article from that day’s Wall Street Journal.

Unemployment Line Longer Than It Looks‎

AHEAD OF THE TAPE
Updated July 5, 2012, 7:26 p.m. ET

By SPENCER JAKAB Here is a statistic for the politically inclined: No incumbent president has won re-election with an unemployment rate above 7.2% since the Great Depression.

Economists expect Friday's release of June employment data will show 95,000 new jobs added. Meantime, the unemployment rate is seen unchanged at 8.2%. That may be bittersweet or just plain bitter depending on one's political slant, but it is difficult to reconcile today's rate with past periods.

The headline unemployment rate has been flattered by the number of people no longer counted in the denominator used to calculate it. For example, a comparison of jobs data between the start and end of 2011 shows the ranks of the unemployed fell by 822,000 while the number of people not in the labor force grew by a larger 1.24 million. The unemployment rate fell by 0.6 percentage points over that time to 8.5%.

In fact, the participation rate—the share of the working-age population either working or looking for work—has fallen by 2.3 percentage points over the four years through May to 63.8%, a three-decade low. Nearly 88 million people—about seven times the ranks of the officially unemployed—aren't part of the headline rate's calculation.

Hmmm. Give that some thought. Also, when May’s figures were released, Judson Phillips of Tea Party Nation was on Tom Hartmann that Friday night. He kept referring to the "U-6 Number." That can be found in Table A15. It is "Total unemployed, plus all persons marginally attached to the labor force, plus total employed part time for economic reasons, as a percent of the civilian labor force plus all persons marginally attached to the labor force." It appears in two forms, seasonally adjusted and non-seasonally adjusted. Either way, it is the least optimistic of all the estimates.

Thanks to DUer alp227, you can watch Judson Phillips’s appearance on Tom Hartmannn here: http://www.democraticunderground.com/1014184289#post12

ADP, for employment in June:

ADP jobs up 176,000 (for June)

BLS, for employment in May:

http://www.democraticunderground.com/1014133487
May payroll employment changes little (+69,000); jobless rate essentially unchanged (8.2%)

ADP, for employment in May:

http://www.democraticunderground.com/1014132307
May change in employment +133,000

BLS, for employment in April:

http://www.democraticunderground.com/1014113023
Payroll employment rises 115,000 in April; unemployment rate changes little (8.1%)

ADP and Gallup, for employment in April:

There were four related threads about the April jobs estimate at DU already. Three are in General Discussion, and they are based on the figures from ADP. The fourth, in LBN, paints a contrasting picture. It relies on the figures from Gallup.

http://www.democraticunderground.com/1002635553
Per CNBC - ADP Numbers bad, posted by Laura PourMeADrink

http://www.democraticunderground.com/1002635507
BAD: ADP JOBS REPORT MISSES EXPECTATIONS BY A MILE, posted by xchrom

http://www.democraticunderground.com/1002635837
ADP & TrimTabs Showing Much Weaker Payrolls Ahead of Unemployment Report, posted by marmar

http://www.democraticunderground.com/1014111465
U.S. Job Creation Nears Four-Year High, posted by brooklynite

There's a joke about economists in there somewhere.

March, BLS:

Payroll employment rises 120,000 in March; unemployment rate changes little (8.2%)
March, ADP:

Businesses Adding 209,000 New Jobs Last Month Fail To Ignite Market Rally

February, ADP:

ADP Estimates U.S. Companies Added 216,000 Jobs in February, posted by Gruntled Old Man

One more thing:

So how many jobs must be created every month to have an effect on the unemployment rate? There's an app for that.

http://www.frbatlanta.org/chcs/calculator/index.cfm
Federal Reserve Bank of Atlanta Jobs Calculator™

Well, enough of that. On with the show.

Monthly Employment Reports

The large print giveth, and the fine print taketh away.

A DU'er pointed out several months ago that, if I'm going to post the link to the press release, I should include the link to all the tables that provide additional ways of examining the data. Specifically, I should post a link to "Table A-15. Alternative measures of labor underutilization." Table A-15 includes those who are not considered unemployed, on the grounds that they have become discouraged about the prospects of finding a job and have given up looking. Here are those links.

Employment Situation

Table A-15. Alternative measures of labor underutilization

From the February 10, 2011, "DOL Newsletter":

Take Three

Secretary Solis answers three questions about how the Bureau of Labor Statistics calculates unemployment rates.

How does BLS determine the unemployment rate and the number of jobs that were added each month?

BLS uses two different surveys to get these numbers. The "household survey," or Current Population Survey (CPS), involves asking people, from about 60,000 households, a series of questions to assess each person in the household's activities including work and searching for work. Their responses give us the unemployment rate. The "establishment survey," or Current Employment Statistics (CES), surveys 140,000 employers about how many people they have on their payrolls. These results determine the number of jobs being added or lost.

[Morganfleeman]

1. An okay number

But not enough to change the direction of the economy. I suspect hiring may be muted until there is a resolution on the debt celing/sequester, although there is upside potential until then due to the partial resolution of the fiscal cliff.

[bhikkhu]

3. The direction of the economy is "steady growth"

In the long term, we need to settle down to a sustainable and stable condition, but I hope the current trend keeps up for another year or two at least, to match more jobs to population.

What would be most helpful is upward pressure on wages.

[Morganfleeman]

5. Hourly wages

ticked up this month. The trend needs to continue which will feed into consumer confidence.

[jpak]

2. If it weren't for the fucking Teabaggers, it would be 255,000+

yup

[Liberal_Stalwart71]

4. Exactly!! Not Obama's fault!!!

[Morganfleeman]

6. Definitely would have been higher

if not for the fiscal cliff circus.

[realism101]

7. Economists

Economists on Bloomberg this morning indicated that the payroll tax increase will cause a 1% annualized drag on the economy. For an economy that is growing at a lackluster 2%, this represents a 50% loss of economic growth. Not good.

Economists also say that in order to grow the economy, about 200,000 new jobs need to be created each month. The average for 2011 was 153,000 and the average for 2012 was 146,000.

Together, these numbers create a bleak picture.

Another interesting stat to look at is BLS's Not in Labor Force, Want Job Now (NILFWJN). While that particular statistic has only been kept since 1994, it set a new record in 2012, at almost 7,000,000 people.

All of this stuff is available on a great resource, FRED, the Federal Reserve Economic Data website, [link:http://research.stlouisfed.org/fred2/|.

[progree]

9. Which economists say 200,000 jobs/mo need to be created in order to grow the economy?

Last edited Sat Jan 5, 2013, 02:55 AM - Edit history (1)

First time I've heard anything like this.

I've heard numbers ranging from 50,000 to 150,000 as the jobs needed per month to be created to keep the unemployment rate stable. I've never heard that the economy can't grow unless X number of jobs are created, heck there are times when the economy grows while jobs are being lost, thanks to productivity gains.

Do you have a link to the Bloomberg article on the payroll tax increase causing a 1% drag on the economy? Could be.. I'm disturbed Obama didn't even make a fight of keeping the payroll tax holiday for another year or two when the economy needs all the help it can get.

Re: BLS's Not in Labor Force, Want Job Now (NILFWJN) -- Not being in the labor force is defined as not having a job and not having looked for a job in the last 4 weeks. One has to look for a job in order to find one. All the wanting in the world is not going to help. Do you have a link that shows it reached an all time record in 2012?

Yes, there is a lot to be gloomy about out there.

I'd rather have Obama than Bush though --

# The economy Bush handed to Obama lost 4.3 million jobs during the last 10 months of the Bush administration. Furthermore, at the end of the Bush administration the rate of job losses was accelerating -- losing 2.28 million jobs just in his last 3 months -- an average of 760,000 lost jobs a month (the average of the last 3 months of the Bush presidency).

# Bush's entire 8 year record: created 1.1 million payroll jobs - by creating 1.8 million government jobs and destroying 0.7 million private sector jobs. ( the actual numbers are, in thousands: Total: 1,080, Govt: 1,753, PrivateSector: -673 ). Yes, it is ironic that a supposed "small government conservative" ended up creating government jobs and destroying private sector jobs.

# Under Obama there have been 33 straight months of private sector job growth (since February 2010), totaling 5.1 million private sector jobs (thru November 2012 with October & November preliminary). Total job growth during this period is 4.6 million jobs ( 0.5 million government jobs were lost ).

(I'll have the Obama numbers in the above paragraph updated through the end of December in 2-3 hours). Likewise the job numbers where the above 3 paragraphs comes from -- http://www.democraticunderground.com/111622439#post2

Oh, welcome to DU!

[realism101]

11. Here you go...

www.economicpopulist.org/content/how-many-jobs-are-needed-keep-population-growth

A lot of what I get from Bloomberg is from Bloomberg radio on my way to work in the morning. They have economists from various walks of life (Professors, ex-Fed Chairs, Wall Street, etc.). This week, the majority of them pegged the fiscal drag due to the end of the payroll tax increase at 1%. A couple said .5%-1.0%, a couple said slightly more than 1% and a couple right at 1%. Sorry, no link for radio, but if you do a google search on "fiscal drag due to payroll tax increase", you'll quickly find several articles that say 1%.

It's easy to see why. Income taxes can be spent by the government, while the payroll taxes go to SS and Medicare. That money is going to rebuild those accounts, instead of increasing the amounts paid out. Reduced personal spending and reduced government spending create fiscal drag.

I think you're misreading the NILFWJN statistic. Read the above link for more info.

[progree]

12. Social Security payroll tax holiday did not affect the Social Security Trust Fund

Last edited Wed Jan 9, 2013, 09:03 AM - Edit history (1)

[font color=blue] realism101> A lot of what I get from Bloomberg is from Bloomberg radio on my way to work in the morning. They have economists from various walks of life (Professors, ex-Fed Chairs, Wall Street, etc.). This week, the majority of them pegged the fiscal drag due to the end of the payroll tax increase at 1%. A couple said .5%-1.0%, a couple said slightly more than 1% and a couple right at 1%. Sorry, no link for radio, but if you do a google search on "fiscal drag due to payroll tax increase", you'll quickly find several articles that say 1%.

> It's easy to see why. Income taxes can be spent by the government, while the payroll taxes go to SS and Medicare. That money is going to rebuild those accounts, instead of increasing the amounts paid out. Reduced personal spending and reduced government spending create fiscal drag. < [/font]

I added the bold font to "That money is going to rebuild the accounts".

Actually, the partial payroll tax holiday (a 2 percentage point of income reduction in the employee's tax) did not reduce the inflow into the Social Security Trust Fund (SSTF). The Treasury's General Fund made up the difference (by borrowing more from the public):

/==========2011 SSTF Operations ==================================
http://www.ssa.gov/oact/trsum/index.html - Below is about calendar year 2011 published April 2012

(Progree note: the SSTF = OAS trust fund + DI trust fund, often combined and called the "OASDI" or "OADI" trust fund. All emphasis in the below is mine)

"A SUMMARY OF THE 2012 ANNUAL REPORTS"

... "A temporary reduction in the Social Security payroll tax rate reduced payroll tax revenues by $103 billion in 2011 and by a projected $112 billion in 2012. The legislation establishing the payroll tax reduction also provided for transfers of revenues from the general fund to the trust funds in order to "replicate to the extent possible" payments that would have occurred if the payroll tax reduction had not been enacted. Those general fund reimbursements comprise about 15 percent of the program's non-interest income in 2011 and 2012".

[font face = courier new]... "What Were the Trust Fund Results in 2011?" (In $ Billions)

(they had OASI and DI trust funds separately, I added them together in the below. All underscores are for spacing, because DU software removes leading spaces -Progree)

2608.9 Assets (end of 2010)
_805.1 Income during 2011
_736.1 Outgo during 2011
__68.9 Net Increase in Assets
2678.0 Assets (end of 2011)

... "What Were the Sources of Income to the Trust Funds in 2011?" (In $ Billions)

(they had OASI and DI trust funds separately, I added them together in the below -Progree)

564.3 Payroll taxes
_23.8 Taxes on benefits
102.7 [font face = Arial]General Fund reimbursements[/font]
114.4 Interest Earnings
-----------------------------
805.1 Total [/font]

... "The Temporary Payroll Tax Cut Continuation Act of 2011 (Public Law 112-78) and the Middle Class Tax Relief and Job Creation Act of 2012 (Public Law 112-96) reduced the OASDI tax rate for 2012 by 2 percentage points for employees and for self-employed workers. Under current law, the employee tax rate reverts to the employer rate in 2013. Transfers from the General Fund of the Treasury to the OASI and DI Trust Funds compensate for the loss of payroll tax revenue due to the temporary reduction and have no financial impact on either trust fund."

... "But the weak economy has placed indirect pressure on the program as well, in that lawmakers have relieved workers of part of the tax burden of financing Social Security benefits so as to bolster near-term economic growth. Under this policy, over $200 billion will be transferred from the General Fund of the Treasury to replace foregone Social Security tax collections. In 2011, due in large part to this change in program financing, payroll tax revenue represented only 70 percent of total Social Security income. Lawmakers should carefully consider whether continued significant General Fund financing for Social Security could threaten to undermine long-standing public perceptions of the program as an earned benefit financed by workers according to contributory social insurance principles."

\==================================================================

See also the first 2 tables of http://www.ssa.gov/oact/STATS/table4a3.html and note the General Fund reimbursements column of the 2nd table.

In short, the SSTF was not at all impacted by the payroll tax holiday. It has as many assets in it with the payroll tax holiday as it would have had without it. However, the last sentence of the the above excerpt is crucial:

"Lawmakers should carefully consider whether continued significant General Fund financing for Social Security could threaten to undermine long-standing public perceptions of the program as an earned benefit financed by workers according to contributory social insurance principles."

In other words, we progressives have long claimed that SS was a separate program separately funded by payroll taxes and not contributing one cent to our national deficits. That is no longer true -- thanks to the payroll tax holiday in 2011 and 2012, over $200 billion of the funding of these programs have come from the general fund, and to get that money, $200+ billion was borrowed from the public (Treasury securities were sold to U.S. and international investors and savers), i.e. put on the national credit card. Thus it is no longer a program that has been financed entirely by payroll taxes.

/==================================================================
Obama tax proposal worries Social Security allies, Associated Press, 9/12/11
http://news.yahoo.com/obama-tax-proposal-worries-social-security-allies-194946697.html

... "Last year (i.e. in 2010 -Progree), Social Security's expenditures were $49 billion more than it collected in taxes, the first time it ran a deficit since 1983".

(Progree notes that there was no payroll tax holiday in 2010 -- the year being discussed in this article -- so this isn't a complicating factor. Note also that $117.5 B of interest was earned on trust fund assets in 2010. This interest earned exceeded the $49 billion operating deficit by $68.6 B, so the SSTF assets increased by $68.6 B. See the table at the very bottom of this posting for the 2010 SSTF operations).

... "Obama and Congress agreed in December to cut the 6.2 percent payroll tax that workers pay on their wages to 4.2 percent in 2011 as part of a deal continuing former President George W. Bush's 2001 and 2003 tax cuts. That cost Social Security $112 billion — money the government is making up by putting an equal amount of additional IOUs in the system's trust fund."

\==================================================================

[font color=blue] realism101> Income taxes can be spent by the government, while the payroll taxes go to SS and Medicare [/font]

Well, sort of. The government primarily spends the payroll taxes on SS and Medicare beneficiaries. I'll just talk about the SS part of it, since the payroll tax holiday affected SS, not Medicare. Any annual SS surpluses -- amounts received in SS payroll taxes in excess of SS program beneficiary program payouts -- are borrowed by the federal government and spent on general federal spending (aircraft carriers, national parks, government salaries, on and on). In return, for those surplus amounts that were borrowed and spent, they put special federal securities into the trust funds, that say in effect, "I the federal government, owe you (whatever trust fund, whatever dollars)". The SSTF (and Medicare trust funds) consist entirely of such federal securities.

But you are correct that there will be a fiscal drag that will be caused by the ending of the partial payroll tax holiday.

During the payroll tax holiday, workers kept more money in their pocket and spent most of it, thus stimulating the economy. The federal government collected less money in payroll taxes, and so, instead of being able to borrow and spend those payroll tax dollars, they had to make up the difference elsewhere by borrowing more from U.S. and international savers and investors (selling bonds to the public, where the "public" includes international as well as U.S.).

That last paragraph is a bit simplified, since actually there was an operating deficit in Social Security (even had there been no payroll tax holiday, expenditures on SS would have exceeded SS tax revenues collected by about $45.5 B. So absent the payroll tax holiday, the federal government would have needed to borrow $45.5 B from the public in order to meet its SS obligations. With the payroll tax holiday, they had to borrow: $45.5 B + $102.7 B = $148.2 B. The $102.7 B is the "General Fund reimbursements" shown in the table way above)

I can explain this further, like what about the interest earned by the SSTF? Those are just more inter-agency securities created by the federal government and put into the SSTF.


What is in the SSTF? How is the interest rate determined?

# "Federal law requires that all excess funds be invested in interest-bearing securities backed by the full faith and credit of the United States. The Department of the Treasury currently invests all program revenues in special non-marketable securities of the U.S. Government which earn a market rate of interest. The balances in the trust funds represent the accumulated value, including interest, of all prior program annual surpluses and deficits, and provide automatic authority to pay benefits." - Source: http://www.ssa.gov/oact/trsum/index.html

# "All securities held by the trust funds have been issued by the Federal Government". Currently all the securities are "special issues—securities available only to the trust fund" - Source: http://www.ssa.gov/oact/ProgData/investheld.html

# All of this in gory detail: http://www.ssa.gov/OACT/NOTES/note142.html

The harsh truth is that while the SSTF is an asset to SS, it is a liability to the federal government (it is money that the federal government owes one of its own agencies - SS). It is counted as part of the national debt. In the below, the "IntraGov" is the various trust funds, primarily the SS and Medicare trust funds.

[div style="display:inline; font-size:1.37em; font-family:monospace; white-space:pre;"] National Debt in Billions of Dollars
[div style="display:inline; font-size:1.37em; font-family:monospace; white-space:pre;"]
[div style="display:inline; font-size:1.37em; font-family:monospace; white-space:pre;"] Public IntraGov Total
[div style="display:inline; font-size:1.37em; font-family:monospace; white-space:pre;"]1/20/2009 6,307 4,320 10,627 Obama inaugurated
[div style="display:inline; font-size:1.37em; font-family:monospace; white-space:pre;"]1/3/2013 11,578 4,853 16,431 Present
[div style="display:inline; font-size:1.37em; font-family:monospace; white-space:pre;"]
[div style="display:inline; font-size:1.37em; font-family:monospace; white-space:pre;"]% Increase 84% 12% 55%

[div style="display:inline; font-size:1.37em; font-family:monospace; white-space:pre;"]Public: debt held by the public. Intragov: Intragovernmental debt
# URL: http://www.treasurydirect.gov/NP/BPDLogin?application=np


[font color=blue]Realism101 > Reduced personal spending and reduced government spending create fiscal drag. < [/font]

The payroll tax holiday has nothing to do with government spending one way or another. Well, if anything -- since the ending of the holiday increases payroll taxes collected from workers -- the federal government will have to borrow less from the public (U.S. and international investors and savers). So if anything it might encourage more spending than otherwise in that our deficit and national debt situation looks a little better without the payroll tax holiday than with it.

As for how much the ending of the payroll tax holiday will cause in fiscal drag, who knows. All during the 2012 presidential campaign, and, for the last 2 or 3 prior years, right wing economists were bloviating about how the stimulus did no good. (The payroll tax holiday, and its similar 2009 & 2010 predecessor -- The Making Work Pay Tax Credit -- were major parts of the stimulus). So I find it ironic that these same economists are suddenly screaming Chicken Little now that this stimulus measure has ended.

Personally, I agree with you that it will significantly matter, and I was shocked and disappointed that the administration didn't even try to bargain for continuing it for another year or two. (It's what happens just about every time a basically nice well-meaning person negotiates with greedy mean-spirited sociopaths). Although it would be much better (and would have been much better in 2011-2012) to simply give workers a 2% of earned income tax credit that didn't involve the Social Security system in any way. I have never read anything about why the Administration had decided to involve the Social Security system in all this in the first place.



/==========2010 SSTF Operations =================================
(A year where there was no payroll tax holiday. I just put it here because the 9/12/11
Associated Press article discusses 2010. And to show the picture in the most recent year without a payroll tax holiday. Everything in ()'s in the below is mine -Progree)

www.ssa.gov/oact/TRSUM/tr10summary.pdf

[font face = courier new].... What Were the Trust Fund Results in 2010? (In $ Billions)
It shows: (they had OASI and DI trust funds separately, I added them together in the below)

2540.3 Assets (end of 2009)
_781.1 Income during 2010 (includes interest income)
_712.6 Outgo during 2010
__68.6 Net increase in assets (were it not for the interest income, trust fund assets would have decreased by $48.9 B).
2608.9 Assets (end of 2010)

... What Were the Sources of Income to the Trust Funds in 2010? (In $ Billions)
It shows: (they had OASI and DI trust funds separately, I added them together in the below)

637.3 Payroll taxes
__2.4 General fund reimbursements
117.5 Interest earnings
_24.0 Taxes on benefits
-----------------------------
781.1 Total [/font]

\==================================================================

[quadrature]

8. after 4plus years of recession...

these numbers leave a lot
to be desired.

[progree]

10. The recession ended June 2009 according to the NBER, 5 months after Obama took office

See http://www.democraticunderground.com/111622439#post3 for more info on that

See http://www.democraticunderground.com/111622439#post1 and http://www.democraticunderground.com/111622439#post2 for the calamity Obama inherited and the improvement since the bottom.

I think what Obama and the Dems have done for the economy is a miracle given that they've been filibustered and obstructed for the last 2 years by the RepubliCONs.

Would Romney have been better? Yes, he was a genius at creating jobs in China, but I'm not so sure that a 20% across the board tax rates cut and $2 trillion additional in core defense spending, all paid for by closing some unspecified "loopholes", was a plan. More like an utter disaster.