In days gone by, it was not uncommon to hear a "spit-spat" and a whistling coming from a kitchen as a metal disc jiggled on top of the stovetop pressure cooker, allowing steam and pressure to escape the big pot cooking under enormous force.
Sometimes those occasions ended with food on the ceiling, floor and every nook and cranny in between when the pressure cooker exploded. The jiggling and whistling was not followed by a quick-enough reduction of the heat applied.
It's funny to think back on and was a tremendous sight to see, but the danger of the situation overshadowed the mess.
America's economy is a pressure cooker, with all the warning signs of a spewing, hissing and jiggling commotion that already should been addressed. Soon we may require a clean-up crew to assess the damage.
If the unemployment rate from the inaugural month of President Barack Obama's administration through March 2012 was plotted, the data from the Bureau of Labor Statistics would show that the low of 7.6 percent unemployment of January 2009 was followed by the administration's highest level of 10.2 percent in October of the same year, and it now is holding at 8.2 percent. This "improvement" in unemployment is the result of three years of "stimulus" spending, automaker bailouts, a takeover of our nation's health care commerce, excessive regulation that overwhelms businesses and tax increases, just to name a few actions.
The U6 rate is a measure not only of the unemployed but of those who have given up on finding jobs. The March 2012 U6 rate is 14.5 percent, not 8.2 percent.
In 1990, just before that economic recession, the labor force participation rate, the percentage of the population ages 16 to 79 who are employed, was 66.5 percent. Twenty years later, in 2010, America's labor force participation rate is dramatically reduced to 64.7 percent. The size of our labor market has shrunk.
Based on analysis by the Federal Reserve Bank of Chicago, the job market and the contraction of the labor market are influenced by shifting demographics and an aging population, but the impact of the "recent deep recession and lackluster recovery" shares significant responsibility.
When purchasing power is decreased by increased prices and coupled with too much money being in circulation, the economy experiences inflation.
Our government has responded to the economic downturn by "printing money" on several occasions.
An item purchased in 1990 for $20 would cost $35.10 in 2012, for a rate of inflation change of 75.5 percent, according to the U.S. Inflation Calculator. The $20 item purchased in 2000 would cost $26.64, a rate of inflation change of 26.64 percent.
Sound monetary policy to protect the value of our dollar and its role as the world's reserve currency has been placed on a shelf and is collecting dust.
Excessive spending yields an annual deficit. Years of annual deficits are added to form our national debt. Our federal government owes almost $15.7 trillion to our own Treasury and other nations, particularly China at more than $1 trillion. The interest the United States paid on our debt in March alone was $24.68 billion.
This debt now exceeds our gross domestic product, our entire economy.
The excessive spending that feeds this fatal debt, the inflationary pressures that prevent our hard-earned money from purchasing at its fullest value, and the labor market that sees fewer jobs and fewer workers are signs of disaster in our economic pressure cooker.
The cooks tending to the kitchen now are preoccupied with the election cycle of 2012. The political chefs who've created this stew are ignoring the urgency involved. The Obama administration and the Democrat-controlled U.S. Senate must present a budget that cuts spending. There have to be policies that address the more than $50 trillion in unfunded liabilities for future promised spending such as Social Security and Medicare. Our government, finally, has to flatten the tax structure, incentivize saving and work versus entitlement, and address the health of our currency.
Jiggle, jiggle, hiss, hiss ... It's not looking very promising.
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