Obama's voodoo economics

President Obama hyped Friday's job-report numbers, claiming a slight drop in the unemployment rate as evidence that things were "moving in the right direction." The numbers hardly represent good news as Mr. Obama continues to ignore the creeping indications that his debt-fueled economic policies are hurling the country toward a historic collapse.

Non-farm payrolls grew by 431,000 jobs, but more than 90 percent of the increase was from temporary Census Bureau hires; these people can expect to rejoin the ranks of the unemployed when the counting is finished. Private-sector job growth accounted for just 41,000 jobs, far below the expected 190,000. The drop in the unemployment rate from 9.9 percent to 9.7 percent looks good on the surface, but it occurred mainly because 322,000 people gave up their job search and exited the labor force.

Those lucky enough to land a position aren't necessarily happy. In Mr. Obama's economy, more than 40 percent of workers have low-paying service-oriented "burger flipper" jobs as the underemployment rate soars. Last week, Vice President Joseph R. Biden Jr. touted the success of the 2009 stimulus package, saying it would create 700,000 to 1.4 million jobs by the end of 2010. But that was a significant downgrade from the 4 million jobs Mr. Obama had promised last year, and it does not account for the 2.6 million jobs already lost. Because "stimulus" jobs are created through government deficit spending, Mr. Biden's "progress" is as illusory as trying to pay off a home mortgage with a credit card.

On Friday, the president proclaimed that "the economy is getting stronger by the day." The math suggests otherwise. Under his policies, government debt is accumulating at three times the rate it did under President George W. Bush, who was no budget hawk. Annual deficits are around 90 percent of gross domestic product and rising. This year, the U.S. government will issue 45 percent of the world's new debt - in other words, almost as much new debt as the rest of the world's governments combined.

Home foreclosures also hit a record high in Mr. Obama's first year in office, and they are set to break more records in his second year. First-quarter 2010 foreclosures were 35 percent over the first quarter of 2009. Foreclosures in March 2010 were the highest monthly total since RealtyTrac began reporting those data in January 2005. Personal bankruptcy filings in 2009 were up 32 percent over 2008, and 6,673 people filed per day in May 2010, 10 percent above filings a year earlier.

Hours after Mr. Obama's optimistic speech, the broad stock indexes were all down more than 3 percent. Since April 26, the Dow has dropped 10 percent, giving up all its gains since October 2009. Last month was the worst May for the Dow since 1940. With Mr. Obama in his 18th month in office, the White House can no longer credibly blame these dismal numbers on his predecessors. President Reagan's attempt to get out of the Carter recession was called "voodoo economics" - but it worked. Mr. Obama's economic plan, by contrast, is leaving the country debt-ridden, underemployed and awaiting foreclosure.