Although Jack Welch, prominent former General Electric CEO and outstanding 20th century chief executive according to Barron’s business publication, may have been presumptuous in faulting the “Chicago mafia” for perpetrating the unexpected September 0.3% unemployment rate drop, this pre-weekend announcement leaves important questions unanswered.
Technically speaking, such a drop, in light of mediocre job additions of 114,000 (following a previous month’s 96,000), is unprecedented in the monthly U.S. Labor Department’s recent history. Although the vast majority of observers have never questioned the veracity of the Labor Department’s professionalism before, the outcome of the November 6 Presidential election may well depend on the answer to these questions:
1) With the unemployment rate depending on “the Household survey,” a monthly telephone contact of 50,000 homes, inquiring as to those who found work, and who dropped out, it has always maintained its dependability on closely tracking the establishment survey. The latter tracks the employment ups and downs of 160,000 businesses. September’s utterly disproportionate measure of the more imprecise “household” drop reflected an incomprehensible 837,000 jobs gain.
2) Although deliberate tampering can’t be charged, there is an ingrained belief that no president has ever been re-elected with an unemployment rate above 8% before the elections. This psychological handicap must have worried the incumbent President. It’s been established that part-time and temporary jobs, not usually counted, comprised a substantial percentage of the positive “Household” response.
3) The coincidence of this unemployment rate drop was ravenously seized upon by the Administration as proof that the employment picture has magically brightened. What is particularly vexing is that this odd, but conveniently coincidental set of circumstances, has been praised by most of the mainstream media, as supporting the White House’s “Happy days” comments. The incumbent’s spinmeisters even threw in the additional discovery of 86,000 additional positions in July and August, which happened to be primarily government-appointed.
Even though these facts don’t necessarily prove conspiracy, enough doubts concerning these coincidences have been raised to question whether the points exposed herein suggest political opportunism.
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