In our opinion: Latest jobs report is good news, but troubles loom

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  • UtahBlueDevil Alpine, UT
    May 9, 2018 8:09 p.m.

    Redshirt - there is no way to educate you on all the factors that go into this - less alone seasonal demand and cost.

    Lets use your example of increased use in summer . If what you said were true, when summer prices go up, driving/consumption should go down. But the reality is the exact inverse. Consumption and prices both rise together. Demand/Supply/Price all rise together. If people are secure in their financial situations, they will still take that trip regardless of fuel prices.

    But here is the other problem with your proposition. Demand doesn't surge in summer like it used to. More families are flying than driving on summer vacations now. That huge spike we used to see is largely gone because there is also a huge drop in demand for heating oil. Agricultural use goes up, institutional and industrial use goes down in summers.

    Additionally - the overall miles being driven in the US is flat. Year over year there is actually a decrease of .1% from last year. Global oil demand has only increase less than 2% year over year, and yet prices at the pump have increased nearly 20%. Demand and price correlation for oil just isn't as strong as it used to be.

  • Redshirt1701 Deep Space 9, Ut
    May 9, 2018 5:08 p.m.

    To "UtahBlueDevil" but gas use is elastic. When prices shot up a few years ago people stopped driving as much. People carpooled more, and did what they could to cut costs. While the 2 cents per gallon profit is not mandated, that is the average profit the gas industry gets.

    If gasoline is inelastic, why is it that demand surges in the summer and is decreased in the winter?

    Funny to see the demand for gasoline drop like a rock in 2008 when prices shot up. I didn't think inelastic commodities did that.

  • UtahBlueDevil Alpine, UT
    May 9, 2018 3:52 p.m.

    Redshirt.... thanks for providing a needed giggle during my work day. I'm not sure how you equate the deficit of 19.8 when Obama left to a deficit today at 21.1 as being the same number with no change. But hey.... whatever.

    "Again, your lack of economics understanding is lacking. If an oil company profits by 2 cents per gallon of gasoline regardless of its price, why would they celebrate a price that causes people to buy less of their product?"

    Maybe because oil isn't a regulated business and they are not locked in at 2 cents per gallon profit. Since when is the price at the pump based on a cost plus basis? Really? And you're assuming demand is elastic, and people can choose to drive to work or not. "hey gas us up, I'll use less of my car today". Do you decide to drive to work or not based on the cost of gas? For every 1 percent energy cost rise at the pump, demand doesn't come close to decreasing 1 percent. Fuel is one of the most inelastic commodities out there.

    It's not my lack of understanding of economics that is showing....

  • RedShirt USS Enterprise, UT
    May 9, 2018 10:06 a.m.

    To "UtahBlueDevil" your understanding isn't exactly right.

    According to BLS data labor participation rate has remained relatively constant since January 2017. Not really up, but not down either.

    The Deficit last year was close to what it was the year before. This year we don't know what the deficit will be because we haven't seen the full effects of the tax cuts and low unemployment rates.

    Funny that you complain about the Trump tax cuts when the Obama tax cuts were larger and weighted more towards the rich than the Trump cuts were. Also, why not cut income taxes for the rich since they are the ones who are paying the most in taxes. They get 20% of the income but pay 25% of the taxes.

    However, those are not exactly economics but are data points.

    Look up the Laffer curve, liberals love this one while not understanding it. We are at the point where increasing taxes DECREASES revenues. That is why cutting taxes can lead to increased revenues.

    Again, your lack of economics understanding is lacking. If an oil company profits by 2 cents per gallon of gasoline regardless of its price, why would they celebrate a price that causes people to buy less of their product?

  • UtahBlueDevil Alpine, UT
    May 9, 2018 6:37 a.m.

    "And you wonder why liberals are mocked for their lack of economics understanding."

    Here is what I understand.

    Deficit is up $1.2. Trillion in just 14 months.

    Employment participation rate is down.

    Inflation starting to grow - energy up 15% in one year.

    Yes - Trump gave the ultra rich 2 extra cookies. For the average family - they got gold fish cracker. You just wonder how grateful they will be for it when gas reaches $3.50 + a gallon for gas.

  • Shaun Sandy, UT
    May 8, 2018 5:16 p.m.

    @redshirt

    You have to ask what is raising revenues though. Republicans are under the illusion that tax cuts are raising revenues solely on their own. They are not. Tax cuts plus continued deficit spending is what is growing the economy. If Congress would have just cut the deficit with real spending cuts the economy would have shrunk. If Congress would have cut spending and cut taxes at the same time the economy would grow much more slowly (or it may have contracted) due to the spending cuts.

    Spending drives the economy and the tax cuts are essentially debt-financed and wouldnt be any different if congress debt financed the equalivent on infrastructure. It would have grown the economy because it is spending money into the economy and raised revenue.

    As far as my comment you responded to I would rather have a tax and spend liberal, not a tax and spend liberal and spend on top of that like you insinuated. At least with tax and spend it is honest and upfront. Republicans of the last thirty years have piled on debt by cutting taxes because that is easy. Spending cuts are hard.

  • RedShirtHarvard Cambridge, MA
    May 8, 2018 4:13 p.m.

    To "Shaun" so lets get this right. You would rather have somebody that lowers tax revenues through higher taxes then spends more over somebody that raises tax revenues and spends about the same.

    To be clear. You would take somebody that destroys jobs through higher tax rates and is proven to lower tax revenues, then spends more money. The alternative is somebody that helps job growth through lower taxes which INCREASES tax revenues then spends the same or slightly more money.

    To make it even more clear. You would choose the guy giving you 2 cookies over the guy giving you 4 because you like the guy giving you 2 cookies.

    And you wonder why liberals are mocked for their lack of economics understanding.

  • Shaun Sandy, UT
    May 8, 2018 2:54 p.m.

    @redshirt

    I would take a tax and spend liberal over a tax cut and spend conservative any day of the week at this point.

    If we have spending problem like you state then why did republicans go after tax cuts? Shouldn’t they have cut the budget by the deficit amount first before considering any tax cuts?

  • RedShirtHarvard Cambridge, MA
    May 8, 2018 1:19 p.m.

    To "liberal larry" actually we did not balance the budget. The gross debt increased each year under Clinton. It was only by an accounting trick that the budget looked balanced. We have not balanced a budget since around 1957.

    What 99% of people don't realize is that we have a spending problem. The income tax rates have little to do with tax revenues. Since the 1940s we have maintained roughly 18% GDP in tax revenues over time we have raised spending to be 20% of GDP. Unless you spend the same or less than what is brought in you will always be in debt.

    To those of you complaining about the "unpaid for tax cuts", I hate to tell you this, but you are wrong. History shows us that as unemployment drops, tax revenues increase. So, over the past year we saw a tax cut, but it was accompanied by an increase in employment. It is nearly impossible to determine if the tax rate reduction had any ill effect due to the increased number of people working.

  • LOU Montana Pueblo, CO
    May 8, 2018 11:33 a.m.

    "December 2002,Treasury Secretary Paul O'Neill and Larry Lindsey, the White House's top economic adviser, both resigned Friday in a dramatic shakeup of the Bush administration's team charged with reviving the nation's troubled economy."

    They both quit because GWBush gave to many tax cuts to the wealthy and was on a spending spree. They warned he was going to collapse the economy. George W bush being George W bush refuse to heed their warnings and ask for the resignations.

    We are looking at another false economy that is driven purely on speculation. We will see another collapse.

    We have got to bring home the jobs stop exporting money and start taxing offshore accounts and start taxing the rich! A collapse is without question unless we take action now.

  • UtahBlueDevil Alpine, UT
    May 7, 2018 9:44 p.m.

    There is a lot of positive here. It's been improving for 10 years now, and continues to improve. The one number that hasn't improved is the labor participation rate. While one would think that low unemployment would equal more people working - the fact of the matter is we are still at recent history record levels of low participation. We are still hovering under 63% - which means a lot of people have simply left the workforce for one reason or another....

    If we used participation rates of just 10 years ago, we would be looking closer to 7 or 8 percent unemployment. But for what ever reason a good number of people have left the labor force, which is helping keep the unemployment numbers looking good.

    If we do see these people enticed back into the market - if wage growth ever really does improve - we could be seeing a different dynamic here. But right now there is little to no wage growth - and people are staying out.

  • Roland Kayser Cottonwood Heights, UT
    May 7, 2018 4:55 p.m.

    @NoName: Yes Japan's debt is 250% larger than ours, and they have zero problem paying that debt. That suggests that we are far from a crisis point.

  • NoNamesAccepted St. George, UT
    May 7, 2018 2:07 p.m.

    I believe the USA should run a balanced budget and be debt free, excepting perhaps when engaged in an actual declared war.

    That said, like any household or business, the real problem is not so much the raw amount of debt, but how debt compares to income or assets. Comparing debt to GDP is, therefore, on of the more accurate measures of how big debt really is.

    In 2008, our total federal debt was 68% of our Gross Domestic Product.

    In 2009 that rose to 82% of GDP. In 2010, 91%. It was 96% in 2011.

    In 2012, we crossed the threshold: Our total federal debt exceeded total GDP for the first time since WWII.

    For comparison, Japan's national debt is 253% its GDP. Italy's is 131%.

    The UK, is at 85%. Germany at 64%. Mexico at 48%. Russia is at less than 13%.

    As the editorial and some commenters note, this is not a partisan issue. Both sides love to spend more than they make; just on different things.

    Nor, are the tax cuts the real problem here. The federal government has brought in record income tax revenue this year. Debate whether that is in spite of or because of the tax cuts. But total fed income tax revenue is up.

    We just want to spend more than we make.

  • liberal larry Salt Lake City, UT
    May 7, 2018 1:39 p.m.

    Utah drinking water must be inducing amnesia!

    Under Clinton we actually had a balanced budget in 1998, 1999, 2000, and his proposed budget of 2002!

    President Bush, cut taxes, and launched two ill conceived wars, and bingo, it's been deficits ever since!

    Anyone who has taken Econ. 101 knows that you raise taxes, and pay down debt in good times, and cut taxes and increase federal spending in bad times.

  • USAlover Salt Lake City, UT
    May 7, 2018 11:55 a.m.

    Is "trouble looms" really a prediction?

    What makes life life is that trouble always looms. Pretty bold prediction DN. How did you ever come to the notion that trouble looms. lol

  • pragmatistferlife Salt Lake City, UT
    May 7, 2018 11:15 a.m.

    DN "Math is hard."..apparently reality is even more difficult.

    You're only bankrupt if you can't pay what you're asked to pay. America meets it's obligations always...despite the antics of the Republicans. The US has not had a debt only once, 1835.

    So we've had a debt through good times and bad, making debt itself not the issue, and not the inherent boogey man you all would want us to believe.

    That said debt can be a problem and a big one it's not what you characterize it to be, and we are definitely not bankrupt.

  • pragmatistferlife Salt Lake City, UT
    May 7, 2018 11:16 a.m.

    DN "Math is hard."..apparently reality is even more difficult.

    You're only bankrupt if you can't pay what you're asked to pay. America meets it's obligations always...despite the antics of the Republicans. The US has not had a debt only once, 1835.

    So we've had a debt through good times and bad, making debt itself not the issue, and not the inherent boogey man you all would want us to believe.

    That said debt can be a problem and a big one it's not what you characterize it to be, and we are definitely not bankrupt.

  • Frozen Fractals Salt Lake City, UT
    May 7, 2018 11:07 a.m.

    91 straight months of private sector job growth. Trump has only been in office for 16 months. 75 of those months were Obama's.

  • Vanceone Provo, UT
    May 7, 2018 10:47 a.m.

    Ah yes. Cutting spending. And what happens every time someone suggests government spending be cut?

    One party on the left goes into hysterics. "You are pushing granny over a cliff if you cut so much as a penny! From anything!" Heck, one government agency asked for zero dollars because they can totally self fund from fines. And the left screamed bloody murder and insisted they get money sent their way. It's the same way if you suggest even a slower rate of funding--this year, why not 10 % budget increase instead of a 15%? Oh, you'd think we will have rivers of blood in the street.

    And so we get no spending cuts because the left and the media scream about made up fatalities sure to happen if any cuts are made.

    Republicans are little better--they also love showering cash on their favorite companies.

    I mean, all we have to do is just reenact the last budget of GWB (plus inflation) and our budget would be balanced. Anyone think we didn't have enough government the last year of Bush? Somehow, we managed. I'm sure we could manage again, and the world wouldn't end. Unless you ask a Democrat, who is somehow convinced that unless we spend 3 trillion a year we will all die.

  • Roland Kayser Cottonwood Heights, UT
    May 7, 2018 10:19 a.m.

    @Flipphone: The economy has been expanding since 2010. It is not expanding any faster now than it did while Obama was president, in fact the rate of job growth has slowed somewhat. These are numbers, not opinions.

  • DN Subscriber Cottonwood Heights, UT
    May 7, 2018 10:13 a.m.

    @ Marxist
    "@DN Subscriber "True, our nation is past bankrupt, with no way to ever pay off the national debt, let alone the new deficits being added every year, even with economic growth."
    The experience of virtually all modern economies says your assertion is simply untrue. I'm no fan of much of modern capitalism, but on this you are wrong."

    Math is hard.
    $21 trillion debt divided by our 300 million population leaves us with a current debt of $70,000 for every single person living in the U.S.- babies, retirees, those below the poverty line, those paying no taxes at all, and of course the much-maligned taxpaying workers and rich people.

    Where will we come up with $21 trillion on top of current taxes?
    Of course, that does no include the unfunded Social Security funds Congress already spent leaving worthless IOUs in the "lockbox." Nor the personal debts for college loans for degrees in basket weaving and gender studies.

    Confiscation of all personal savings might make a dent. Confiscation of all personal property might help but with no personal wealth there would be no money to buy all the mansions and luxury cars and yachts.

    We're broke!

  • FatherOfFour WEST VALLEY CITY, UT
    May 7, 2018 9:55 a.m.

    "As the recently enacted tax cuts showed, neither party seems worried any longer about reining in the practice of spending more than the government collects each year."

    Congress controls spending. Congress has the power of the purse. The Senate has some balance there but the main power over spending is owned by congress. Both the Congress and Senate have been controlled by the GOP since 2010. 100% of all spending since 2010 at the federal level falls to the GOP.

  • marxist Salt Lake City, UT
    May 7, 2018 9:14 a.m.

    @DN Subscriber "True, our nation is past bankrupt, with no way to ever pay off the national debt, let alone the new deficits being added every year, even with economic growth."

    The experience of virtually all modern economies says your assertion is simply untrue. I'm no fan of much of modern capitalism, but on this you are wrong.

  • DN Subscriber Cottonwood Heights, UT
    May 7, 2018 8:49 a.m.

    True, our nation is past bankrupt, with no way to ever pay off the national debt, let alone the new deficits being added every year, even with economic growth.

    Because, Congress members want to get reelected.
    Voters love "free stuff."

    Congress votes for "free stuff" and pork projects for their districts.
    Voters are happy and vote the congressional spenders back in for another term.

    Congress votes for more "free stuff" and pork for their districts and stay in officer forever.

    Candidates who promise to cut spending on just about anything, but especially "free stuff" don't stand a chance of getting elected.

    Stand by for the big shock when the improving economy and rising interest rates make the interest on our $21 trillion debt every year an incomprehensibly large number, with diminishing chances of even paying that off!

    Our country is headed for a disastrous collapse where there will be no "free stuff," no nice to have govt programs, and even essential govt programs will have to be cut to the bone. Or, we will go full Venezuela collapse, and urban areas will be unable to sustain themselves.

    Stop the spending, NOW!

  • Impartial7 DRAPER, UT
    May 7, 2018 8:04 a.m.

    @imsmarterthanyou;
    "I have a perfect solution. Immediately fire 50% of all government workers. Give the rest a 5 -10% raise, and make them actually earn their paycheck. Billions of dollars saved, problem solved."

    Brilliant. There are 22 million government employees. Yeah- let's place 11 million on the unemployment rolls and SNAP programs. That should save a lot of money. No wonder you're a Trump fan.

  • reriding Salt Lake City, UT
    May 7, 2018 8:04 a.m.

    The economic expansion that started in mid 2009 is now the third longest in our history, and will be the longest in our history if it continues into mid 2019. To suggest otherwise is to buy into the false narrative of the republican establishment and the current administration.

  • There You Go Again St George, UT
    May 7, 2018 7:59 a.m.

    Deficits...profligate spending only matter when the is a Democratic POTUS.

  • goodnight-goodluck Salt Lake City, UT
    May 7, 2018 7:51 a.m.

    Funny Senator Rubio R Fla said the tax plan had only benefited the wealthiest among us, now that everything is wonderful and the rich got their tax cut House Speaker Ryan says we need to balance the budget, on the backs of veterans and the working classes. By the effort to re-brand Social Security, Medicare, and Veteran Benefits as "Entitlements" opposed to Earned Benefits.
    Truly the emperor has no clothes.

  • Shaun Sandy, UT
    May 7, 2018 7:27 a.m.

    Tax cuts without spending cuts is no different than spending beyond tax revenues.

    I agree that basic Econ 101 states the government spends in bad times but pays off the debt in the good times.

  • Flipphone Sandy, UT
    May 7, 2018 7:19 a.m.

    The economy is expanding which it hasn't done for 8 long years managed by Obama, kicked started by federal tax cuts, and the doomsayers can't stand prosperity brought on by a pro business President.

  • imsmarterthanyou Salt Lake City, UT
    May 7, 2018 7:10 a.m.

    I have a perfect solution. Immediately fire 50% of all government workers. Give the rest a 5 -10% raise, and make them actually earn their paycheck. Billions of dollars saved, problem solved.