Morning Jay: If Our 'Food Stamp Recovery' Persists, Obama Will Lose Big
6:00 AM, May 6, 2011 • By JAY COST
I have noticed something unsettling in my own life lately: I know a lot of people who are on food stamps or some kind of extraordinary government assistance. The count right now stands around 10 people, which is a lot for a small town denizen such as myself.
That is a personal reminder of a very serious, yet rarely discussed economic, social, and indeed political problem: the fact that better than one out of seven Americans today requires government help to put food on the table.
The following graph is only for the hale and hearty:
The start date of this heartbreaking graph is important – June, 2009 is the point at which, according to the National Bureau of Economic Research (NBER), the economy hit bottom and began to recover.
What we see in this graph is one example of a persistent feature of the recovery to date. On the top-line of the economic data, it often appears as though we have filled in the hole that was dug by the Great Recession. Check out this graph of personal income per capita to appreciate that. However, it is largely an illusion, a product of deficit-financed government spending – in the form of things like food stamps, extraordinary unemployment benefits, and the relatively stable federal employment situation.
Call it the American "food stamp recovery:" take away the government supports, and the economic picture looks very bleak indeed. Two sobering features stand out.
First, the ability of the private sector to provide people with a stable standard of living is in a long-term decline, one that has only eased, not reversed, in recent months. The following graph captures this phenomenon by tracking real wages per capita derived from the private sector.
What we see here is that the private sector wages and salaries are actually at a thirteen-year low point when measured on a per capita basis, and the most recent reading (from Quarter I of 2011) showed a continued decline. The only “good” news is that the slope of the descent has eased.
Second, the empty spot in the national wallet generated by the breakdown of private wealth has been filled by a socialization of personal income directed by the government. The following graph tracks the share of personal income that comes from either government transfer payments or government salaries.
All of this leads to the next point. This has been the worst economic recovery in generations, at least as it is felt by the average American. Let’s be precise in our language here: we’re not talking about the recession itself; we’re talking about the recovery, which has entirely been on Barack Obama’s watch.
This is not rhetorical bluster, but empirical fact. The following graph demonstrates that by comparing employment in this recovery against every recovery since 1960. What I did was take the percentage of the adult population that was employed when NBER says a recovery began, set that as a baseline (100 percent) and tracked how this recovery stacks up against previous ones.
As we can see, this one is worse than any other in 50 years.