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The Economy and the Cold

The winter has been so cold around here that we’re running out of snappy “it’s so cold” lines, and have lately been reduced to likening it to certain unmentionable portions of witches’ and well-diggers’ anatomies, but the fine folks at the Bureau of Labor Statistics have helpfully provided us with a brand new cliché. Whenever the arctic breezes push the wind chills down to double-digits below zero we can now say “It’s so cold that the jobs report is lousy.”
In case you couldn’t hear the news over the chattering of your teeth, the past two monthly jobs reports have been unexpectedly lousy. We say “unexpectedly” because all the media stylebooks now require that any bad economic news be described that way, as they apparently expected the economy to be chugging along toward egalitarian utopia with Barack Obama in the White House, but even the most enthusiastic cheerleaders in the press have been forced to admit that the jobs numbers — along with other data ranging from consumer confidence to manufacturing activity to the trade deficit — have indeed been lousy. Reluctant to stop telling their favorite tale of a rebounding economy, the press has endeavored to explain the recent bad news as a mere interruption caused by various factors having nothing to do with administration policies. The devaluation of some third world currencies has been one common explanation, as is whatever mischief those darned Tea Party Republicans have been up to lately, but the most popular excuse has been the cold and snowy weather.
This explanation has the obvious advantage of plausibility. The weather has indeed been miserable the past two months in much of the country, and it’s bound to have had some chilling effect on the economy. Here in Wichita the streets have been covered with enough snow to deter the hardiest car shopper from taking a test drive, workers have stayed home to mind children taking an unscheduled winter break from school, and commerce has been frozen as solid as the Arkansas and Little Arkansas Rivers. We hear it’s been worse elsewhere, and almost as bad in places even more unaccustomed to such icy hassles, and those warm weather regions that have been spared the worst of it are probably used to taking life easy. Such awful weather likely explains some of the recent economic data, but we are not reassured that those long awaited green shoots will soon start to sprout through the melting snow.
Even before winter set in the jobs reports were pretty lousy by historical standards, showing just enough job creation to keep pace with population and not nearly enough to make a dent in the record number of long-term unemployed and labor force drop-outs, and it’s hard to see what might have brought improvement even in a mild winter. The Federal Reserve Board’s quantitative easing of gazillions of newly-printed dollars into the stock market seems to have worked well enough to entice so many discouraged workers out of the labor force to push the official unemployment rate down to 6.6 percent, just a tick ahead of the announcement benchmark for ending the scheme, and the markets have responded with a two-month slide that has abated only on the hope that things are still bad enough to keep the presses running at the mint. There’s also been an energy boom based on fracking and drilling on private lands, but the administration has been working on stopping that and the recent problems with the trade deficit suggest it might be succeeding. The economy is increasingly controlled by people who think it’s a good thing that Obamacare will pay a couple million workers to stop working and live on the dole, and that more job-killing regulation is needed to stop global warming.
An economy that is truly chugging along toward utopia, egalitarian or otherwise, should be able to plow through a few feet of snow. Many of the economic effects of the weather can be blamed on the failure of state and local governments to competently deal with the foreseeable challenges of the weather, and their inability to acquire enough salt for the frozen streets should cause some doubt about their ability to run the entirety of the economy and make it fair and sensitive and hurtful to no one’s feelings. A change in the political climate is required, and that is at least two more winters away.
If the weather is to blame for the past two months of economic data the next jobs report should be another lousy one, as February is proving the worst month yet. At this point we have no optimism regarding March, and we expect the April showers will bring a flowering of new excuses.

— Bud Norman

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