By John E. Carey
Peace and Freedom
January 5, 2008
Dark news of trouble for the U.S. economy continued to pile up at the start of 2008.
On Friday, January 4, 2008, a Labor Department report said the U.S. economy edged a step closer to recession in December by producing only 18,000 new jobs, its worst performance in four years, and sending the unemployment rate to a two-year high of 5 percent.
Outside government, private sector jobs actually shrank by 13,000 in December.
According to the Labor Department, lay-offs were across the spectrum of American jobs.
Manufacturers, builders, banks and even retailers laid off more than 100,000 workers at the height of the Christmas shopping season.
The construction trades shed 49,000 jobs and manufacturing lost 31,000 workers.
The housing crisis has put hundreds of thousands of people involved in the construction trades out of work. The trickle down impact is hitting furniture manufacturers and all kinds of other businesses from appliance manufacturers to curtain and carpet makers.
Gas and home heating oil price increases seem likely following reports that petroleum has now hit $100.00 per barrel. Gasoline prices impact all drivers and have already contributed to price hikes on everything from milk and eggs to FedEx deliveries.
Tightening credit, a slumping housing market, oil prices and a staggering stock market are starting to take a toll on the American housewife and wage earner.
Peter Gosselin and Walter Hamilton wrote in the Los Angeles Times, “The [job] losses were widespread, suggesting that the economy’s troubles run deep. They were compensated for by gains in only a few areas, especially health care, food service and government.”
“Economists viewed the report as the most powerful indication to date that the United States could well be falling into a recessionary downturn,” wrote Peter Goodman and Mike Grynbaum in the New York Times.
“This report raises threats” because of the way it undercuts consumers, said Stephen Gallagher, economist at Societe Generale. “Up to this report, employment gains have been seen as sufficient to support the consumer” and keep the economy afloat.
President Bush has been upbeat on the economy but he met yesterday with a host of economic advisors to hear options on how the U.S. government can jump start the economy.
“This economy of ours is on a solid foundation, but we can’t take economic growth for granted,” he said after meeting with a White House working group on financial markets.
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January 6, 2008 at 12:39 pm |
John,
I think this will be the big news leading up to the election this fall. The dislocations to the world economy caused by some combination of the falling dollar, the credit dislocations from the sub-prime mess, war funding, trade imbalances–I’ll leave it up to the experts to determing the cause and effect relationships.
In my little corner of the world, I have been watching the Navy pull money out of the readiness accounts to pay for the war. Everyone knows we have not had a successful shipbuilding program since Aegis. Very few realize that fleet readiness is also in trouble and we are unable to man the ships and we are intentionally not funding maintenance. No money for repair parts. When ships return from deployment they go into a status where the are not allowed to buy all the repair parts they need. We are teaching a generation of sailors that it’s OK to steam around with a radar that doesn’t work. The fact that they can’t properly train between deployments doesn’t seem to make any difference.
I was explaining our current situation the other day. We were in a similar situation in the 1970’s. The difference then was, the leadership of the Navy spoke out and expressed their concern. Reagan remains a hero of mine because he fixed it. Today, what we have was implemneted on purpose by Navy leadership in order to look like team players in the war on terror where the actions was more Army and Marine Corps. The problem is, the party line states that everything is fine.
We have Aegis ships running around with three Third Class SPY Techs. In a war I suspect they would be in real trouble. Training is sad. The Aegis Training Support Groups on the Waterfront have been eliminated. The Aegis Training Center no longer works for the Program Office–in fact there is no Aegis program Office as I’m sure you know. Disestablished because they didn’t like RADM Meyer haveing all that power and money. But Aegis is looking cheap compared to DDG 1000, and LCS.
So the training Center works for the navy’s centralized training bureauracry. Like BUPERS, this is the organization model that caused the Soviet Union to fail. In any case, the took the money out of Aegis training and now that is broken too.
NAVSEA and the Warfare Centers? Downsized to the point that they can’t provide engineering oversight over the Prime’s. CNO Clark pretty much killed the Navy’s engineering organizations.
The budget, engineering and readiness problem won’t be fully visible for another couple of years I suspect but we are approaching the point where we will not have a capable navy if we keep going.
Just a theory! I think we’re in trouble in the Navy and what’s happening to the global economy will accelerate the crunch. Aegis BMD is one bright spot where there seems to be money and talent sufficient to do it right. But they are an MDA organization, not Navy.
Ted
January 10, 2008 at 11:57 pm |
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