Joe Biden's handlers have been hard at work propping up his job performance as our 46th president. It's important to know the difference between "Job Growth" and "Partial Job Recovery." The former is what he is selling, and the later is what we are experiencing.
President Biden's theme is perfectly captured in the tweet below: He is clearly the best president we've seen in decades, right?
In fact, the tweet above covers two bases. First, that he is the largest job generator in history. Just look at that chart! You thought Clinton was good? Clinton's job growth has been eclipsed by the amazing Joe Biden. Second, Donald Trump was not only worse, but he actually destroyed jobs while he was in office. Conservative Republican "Trickle Down" economics don't hold a candle to redistributive, money printing, Socialist-style economics.
Of course, talking points like this only work if you're a political partisan looking for "my team is better than your team" examples to dish out on social media.
I'm no huge fan of Donald Trump. In fact, he didn't get my vote either time (I voted Libertarian), but he did have some success in the jobs-department, until February 2020. Trump's total non-farm employment increased from roughly 145.8 million in January 2017, to 152.6 million in February 2020. That number then dropped to 130.5 million by April 2020.
By the way, from April 2020 to January 2021, Trump grew the economy by over 13 million jobs. That's twice as many in 9 months as Biden added in a year! Doesn't it seem ridiculous to say that Trump "grew the economy" during that time? That's because it is, even though it's exactly what Biden is doing right now.
The Unemployment Rate
The Unemployment Rate, flawed as it is, stood at 3.5% in February 2020, just before the pandemic. Two years later, the rate stands at 4.0%. The number went as high as 14.7% during the pandemic, with estimates of 40 million jobs lost. February 2020's rate was the lowest on record since 1969.
Despite the fact that we have more people unemployed now than before the pandemic, Biden is touting his growth as a milestone in American economic history.
"This morning’s report caps off my first year as president, and over that period, our economy created 6.6 million jobs. 6.6 million jobs," he said. "You can’t remember another year when so many people went to work in this country — there’s a reason. It never happened."
You might be asking yourself, "Can both things be true at once?" The answer is yes. These are in fact record job numbers, statistically. It's also true that we have less people employed now than before the pandemic. Biden is simply making use of a common tactic in statistics. A large decline is likely to be followed by a large increase. In fact, when pulling your data from a smaller number, a smaller absolute increase can be presented as a larger percentage increase.
Let's use an example. You're making widgets. You have 100, and you typically make 10 per year. This year when your 10 widgets are completed, you'll have 110 widgets, an increase of 10%. Next year, you burn half of your widgets in protest along with some of your production capabilities. You start the year with 50, but this year you only create 7, an increase of 14%. One year you had a 10% increase, and the next year you had a 14% increase, which year was better? Even though you had a smaller absolute increase in widgets this year, the percentage is higher than normal because you started from a lower number.
Ask yourself a very simple question: How is it that we are experiencing the best growth in history, but we aren't back to levels previously enjoyed while Trump was in office?
The Difference with Biden's Growth
The economic downturn of 2020 was very different when compared to past examples. It was not a consequence of poor planning by corporations, over-leveraging, wild speculation, monetary policy, or a flaw in the market as a whole. It was a consequence of worldwide government-mandated shutdowns. This is why on our podcast I was able to call the bottom of the Dow Jones within 200 points, and said that the market would recover very quickly. The downturn wasn't real.
This is why Biden's use of the word "growth" is especially troubling. We are growing, but from an artificially induced low point in the numbers. These "new" jobs were previously taken away by the government. It simply took the government getting out of the way for them to come back. And we don't even have all of them back!
Don't fall for the propaganda. It's nothing more than the desperate attempt of a failing administration to present the American people with a "win." Do not let the state take something away from you, and then ask for your gratitude when they give some of it back.