AP Economics teachers’ discussion board: 3 latest topics of Emperor’s New Clothes facts

Advanced Placement Macroeconomics teachers have a discussion board for questions and topics of interest. Since 2009, I’ve participated as best I can imagine to catalyze awakening among ~2,000 AP Econ teachers.

Below are the latest three contributions I’ve made; the first in response to a question, and introducing the other two topics.

I don’t know the status of awakening among these teachers. I do know that the leading contributor to the discussion board attempted to deny the topics I contributed a few years ago, and withdrew into silence after I exposed him of having no data for refutation, only a threatened belief system. I do know that the usual response to my contributions is silence. I do know that ~20 teachers have voiced some form of support over the years.

I also know that I was removed from the Advanced Placement US Government discussion board after four years of contributing facts mostly regarding US wars and the US Constitution.  I was informed by the listserve moderator that a Bill Tinkler of the College Board had deemed these posts “non-academic,” of “personal nature,” and “unsuitable” for consideration of teachers in a college-level course on government.

The three topics:

1. Question on current reserve requirement ratio

Game-changing facts about reserves that students MUST know in order to see the big picture:

  1. Since the “Emperor’s New Clothes” exposure of Lehman in 2008, the US now has (last I looked) over $2 TRILLION in excess deposits over loans.  This is connected to “bailing out” the big banks, in brilliant infographic from Demoncracy here.
  2. The “too big to fail” banks seem to play by different rules for “requirements” because they have (last I looked) over $200 TRILLION in derivatives exposure that turns the idea of reserve requirements and FDIC into a tragic-comedy. Another awesome infographic about these “too big” banks and their derivatives, with the data here, and Jaime Dimon (CEO JP Morgan ) admitting this here (end of article).

So what does this mean?

The big picture is that since The Bank of England’s creation, the big boys have created what we use for money as debt. This debt-based “monetary” system adds negative numbers forever, increasing aggregate debt forever. We see results of this in ever-increasing national debt and consumer debt. The debt will never ever ever ever ever ever ever be repaid, because to do so destroys the system of what we use for money. The only way out is to recognize that this is a debt system, not money, and to stop creating debt forever (duh).

As a “hobby”, I work with colleagues for reforms to create debt-free money to directly pay for public goods and services, public banking so we can create at-cost credit (for example, a state-owned bank could issue 5% mortgages and credit cards that would entirely replace state taxes), and CAFR reform to release all “rainy day” accounts that wouldn’t be needed if we had a public bank for at-cost credit lines. I explain here:

Labor Day 2014: Economic solutions already here for full employment, zero public deficits and debts


2. Gallup CEO: ‘America’s 5.6% Unemployment Is One Big Lie”

The definition of “unemployment” has changed over time, with previous methodology to count underemployed and discouraged workers showing an unemployment rate since 2010 at Great Depression levels over 20%.

This comprehensive understanding is essential for AP students because without it, they cannot compare unemployment rates over time.

The CEO of Gallup agrees their data reflect the reality of high unemployment. In an Emperor’s New Clothes-like statement (excerpts):

The Big Lie: 5.6% Unemployment

Here’s something that many Americans — including some of the smartest and most educated among us — don’t know: The official unemployment rate, as reported by the U.S. Department of Labor, is extremely misleading.

…Say you’re an out-of-work engineer or healthcare worker or construction worker or retail manager: If you perform a minimum of one hour of work in a week and are paid at least $20 — maybe someone pays you to mow their lawn — you’re not officially counted as unemployed in the much-reported 5.6%. Few Americans know this.

Yet another figure of importance that doesn’t get much press: those working part time but wanting full-time work. If you have a degree in chemistry or math and are working 10 hours part time because it is all you can find — in other words, you are severely underemployed — the government doesn’t count you in the 5.6%. Few Americans know this.

There’s no other way to say this. The official unemployment rate, which cruelly overlooks the suffering of the long-term and often permanently unemployed as well as the depressingly underemployedamounts to a Big Lie.

…Gallup defines a good job as 30+ hours per week for an organization that provides a regular paycheck. Right now, the U.S. is delivering at a staggeringly low rate of 44%, which is the number of full-time jobs as a percent of the adult population, 18 years and older. We need that to be 50% and a bare minimum of 10 million new, good jobs to replenish America’s middle class.

I hear all the time that “unemployment is greatly reduced, but the people aren’t feeling it.” When the media, talking heads, the White House and Wall Street start reporting the truth — the percent of Americans in good jobs; jobs that are full time and real — then we will quit wondering why Americans aren’t “feeling” something that doesn’t remotely reflect the reality in their lives. And we will also quit wondering what hollowed out the middle class.


3. Former US Asst. Sec. Treasury explains 5.6% unemployment “lie”

After Gallup’s CEO blasted BLS official unemployment claims as a Big Lie, former US Assistant Secretary of the Treasury and Wall Street Journal editor Paul Craig Roberts followed with detailed explanation of how US data has been manipulated for political purpose.

Again, this is vital for AP students to know because US officials and the 6 corporations dominating media never remind the public how we count unemployment has changed. If they did, the public would know that today’s unemployment rate is comparable to rates in the Great Depression.

As I’ve mentioned, the idea of buying US media includes Congressional testimony of J.P. Morgan doing so in 1917.


Unemployment Number Is Meaningless

On January 9, the US government told Americans that the unemployment rate had fallen to a comforting 5.6 percent, an indication that the Federal Reserve’s policy of Quantitative Easing was successful in restoring the US economy. A 5.6 percent rate of unemployment suggests that Americans have a reasonable chance of finding a job. Yet we know there are millions of discouraged workers who have given up looking for a job.

The explanation of this paradox is that the 5.6 percent unemployment rate (U.3) does not include unemployed people who have not looked for a job in the previous four weeks. These unemployed are called “discouraged workers.” If they have been discouraged for less than one year, they are counted in a seldom-reported measure of unemployment (U.6). This rate stands at 11.2 percent, twice as high as the unemployment rate stressed by government and financial media.

The 11.2 percent rate is an official measure, but it is not publicized because it indicates a dismal employment outlook 5.5 years after the 2008 recession was declared over, in June 2009. What kind of recovery is it when the unemployment rate remains at 11.2 percent years after the recession has officially ended?

The Great Lie Exposed

The story worsens. The 11.2 percent rate does not include the millions of unemployed long-term discouraged workers (those discouraged for more than one year). Prior to 1994, the US Bureau of Labor Statistics counted the long-term discouraged as unemployed, and the government of Canada still does. John Williams (shadowstats.com) continues to include the long-term discouraged. When the long- term discouraged are added to the U.6 measure, the rate of unemployment again doubles, to 23 percent.

In other words, the actual unemployment rate is actually four times higher than the comforting figure released January 9.


Note: Examiner.com has blocked public access to my articles on their site (and from other whistleblowers). Some links in my articles are therefore now blocked. If you’d like to search for those articles other sites may have republished, use words from the article title within the blocked link. Or, go to http://archive.org/web/, paste the expired link into the box, click “Browse history,” click onto the screenshots of that page for each time it was screen-shot and uploaded to webarchive. Then switch the expired URLs with webarchived ones of that same information. I’ll update as “hobby time” allows; including my earliest work from 2009 to 2011 (blocked author pages: here, here).

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