Obama's Dept of Defense Shell Game

As we approach the sequester deadline Obama is wringing his hands on every venue he can find talking about the massive unemployment the sequester will cause.  Aside from the fact the sequester was his and Jack Lew's idea, the voters should realize that, once again, he is scamming them.

Take the Department of Defense 22 day furlough plan.  The plan calls for a 4 day work week for the next 22 weeks. That is obviously a problem for those workers who will lose 20 percent of their pay during that time period.  The real insult, however, is the insult to voter's intelligence.

The last thing that Obama wants to see is a massive increase in the unemployment numbers. He can get around that by using this furlough plan instead of outright layoffs.  The reason that he can is the way that employment is calculated.  If a worker is at a job for just 1 hour a week, that worker is counted as full time employed (see Bureau of Labor definition below). Basically an underemployed worker who falls through the statistical crack. 

Once again Obama has hidden the pea under a shell and fooled the voters.

Employed persons (Current Population Survey)

Persons 16 years and over in the civilian noninstitutional population who, during the reference week, (a) did any work at all (at least 1 hour) as paid employees; worked in their own business, profession, or on their own farm, or worked 15 hours or more as unpaid workers in an enterprise operated by a member of the family; and (b) all those who were not working but who had jobs or businesses from which they were temporarily absent because of vacation, illness, bad weather, childcare problems, maternity or paternity leave, labor-management dispute, job training, or other family or personal reasons, whether or not they were paid for the time off or were seeking other jobs. Each employed person is counted only once, even if he or she holds more than one job. Excluded are persons whose only activity consisted of work around their own house (painting, repairing, or own home housework) or volunteer work for religious, charitable, and other organizations

Obama's Deceptive Math

Secretary Panetta and General Dempsey appeared on several talk shows this morning.  One of the areas discussed is the impact of the impending sequester on defense spending.  Panetta has continually warned that the sequester would significantly impact the ability of the military to carry out its mission.

They have discussed the nature of personnel cuts that will be made to meet the sequester requirements.  If I am not mistaken, General Dempsey said they were looking at reducing the work week by 2 days accompanied by a 20% pay cut. That is bad for the economy and, of course, bad for those workers subject to the cuts.

So far so bad...but  wait...there is worse news and it takes the form of of typical political chicanery.  Remember we are in the midst of a tepid recover and unemployment remains high. We also know that Obama likes to tout luke warm economic advances especially now that unemployment rates have seemed to improve (not if you look at the underlying numbers and trends).  Remember also that the monthly employment reports includes both full and part time workers (a part time worker is defined as a worker working one or more hours a week).

Now, if I understood the General correctly, those workers having their days and income cut back under the sequester would NOT APPEAR AS A REDUCTION IN EMPLOYMENT, AND THEREFORE THE UNEMPLOYMENT RATE WILL NOT GO UP...PRETTY SNEAKY.  Fewer days...less income...bad for the economy.  Ability to hide the impact of the job time reduction on total employment...good for the Obama spin machine.

It gives me a headache just thinking about it.