Examiner:

White House Press Secretary Jay Carney explained that the number of people dropping out of the work force, which artificially depresses the unemployment rate, can be regarded as an “economic positive.” “A large percentage of that is due to younger people getting more education, which in the end is an economic positive,” Carney said. “This increase in the number of people leaving the work force has been a trend and a fact since 2000, because of an aging population”

This chart tells a different story:

An unemployment rate doesn’t drop two points in a month because kids are staying in school longer. And the amount of the “aging population” still in the workforce is near historic highs, since they can’t afford to retire. Once again we feel like we’re living in a world where it’s Opposite Day from the politicians and their captive media every single day. HT: GP

Following hard on the heels of the good “jobs” news from the mysterious disappearance of the American workforce, the Washington Post has another cheerleading story for the administration (“improved public confidence in his economic stewardship”) based on a “poll.” There’s just one little problem with the poll. It doesn’t disclose its sample. Cooked books, cooked polls. Ugh. What an ugly year 2012 is shaping up to be. Aren’t the “journalists” who “report” on “polls” and “jobs” like this embarrassed, even a little bit?

NY Post:

The Labor Department reported a loss of 2,689,000 jobs in January…In January 2010, as I said, there was an actual, unadjusted job loss of 2,858,000 jobs. To make it simple, the government computers were expecting a bigger unadjusted loss than the 2,689,000 jobs because last January’s decline was 2,858,000. Why weren’t there as many job losses this January? Very likely because the weather throughout the country is a lot milder this year than during the past two Januarys. A loss of jobs that isn’t as bad as expected turns into a job gain. Does that mean there really are 243,000 new jobs out there? Absolutely not.

Let’s say there are rumors in your company that 300 people are going to be laid off. Instead, management decides to fire just 200. Two hundred people, of course, have lost their jobs. But, adjusting it for expectations, 100 people didn’t get fired. Using this analogy, the government would say that, on an expectation-adjusted basis, 100 jobs were created. That’s sort of what happened in the January employment report because of seasonal adjustment.

Let’s get this straight. Jobs went down 2.7 million instead of 2.9 million in January and this is a job gain of 243,000 jobs? Okay. The labor force lost 1.7 million people, which trnslated into a seasonally adjusted 1.2 million people, so the labor force participation rate continued its drop to historic lows among prime age workers.

Meanwhile, the actual non-seasonally adjusted jobs number for December and January is a loss of 2.9 million jobs (which the BLS translated, using a methodology that we were unable to determine, into a job gain of 446,000 jobs). And these jobs losses and labor force losses are a cause for celebration? Huh? It’s all kind of confusing to us, and not in a good way.

From a recent speech by a politician:

when I talk about our financial institutions playing by the same rules as folks on Main Street, when I talk about making sure insurance companies aren’t discriminating against those who are already sick, or making sure that unscrupulous lenders aren’t taking advantage of the most vulnerable among us, I do so because I genuinely believe it will make the economy stronger for everybody. But I also do it because I know that far too many neighbors in our country have been hurt and treated unfairly over the last few years, and I believe in God’s command to “love thy neighbor as thyself.” I know the version of that Golden Rule is found in every major religion and every set of beliefs — from Hinduism to Islam to Judaism to the writings of Plato.

Words are like the tides. They come and go, nice to watch, with no lasting impact. Who cares if the Golden Rule is something else than represented above? Who cares if Plato said something other than claimed above? No one will check; no one will care. (We’ve seen it all before, over and over again.) Bonus points if you can figure out why Plato was included on the list.

Spengler:

The rush out of the Egyptian pound is so rapid that Egyptian investors refuse to hold debt in their own national currency, even at a 16% yield. After Islamist parties won more three-quarters of the seats in recent parliamentary elections – 47% for the Muslim Brotherhood and 25% for the even more extreme al-Nour Party – the business elite that prospered under military rule is counting the days before exile. The first reports of actual hunger in provincial Egyptian towns, meanwhile, are starting to trickle in…

It seems unlikely that Egypt’s central bank will be able to prevent a banana-republic devaluation of the Egyptian pound, and a sharp rise in prices for a population of whom half barely consumes enough to prevent starvation. The difference between Egypt and a banana republic, though, is the bananas: unlike the bankrupt Latin Americans, who exported food, Egypt imports half its caloric consumption. Meat imports have already fallen by 60% over the past year…

Nearly half of Egyptians are functionally illiterate. Nine-tenths of adult women have suffered genital mutilation. Almost a third of Egyptians marry first or second cousins, the fail-safe indicator of a clan-based society. Half of Egyptians live on less than $2 a day, and must spend half of that on food…It should have been no surprise that the Islamists swept the parliamentary elections, given the desperation of the people and the cupidity of the political system. The Wafd Party, Egypt’s oldest secular political entity, polled just 9% of the vote.

Delusional as it was to expect Egyptians to support secular liberal parties that never existed and offered no solution to their desperation, it is all the more delusional to expect the Islamists to stabilize Egypt. The Islamist victory in the first round of voting last year almost certainly prompted the jump in capital flight in December, and the consolidation of Islamist power. Egypt’s middle class will leave and tourism, down by a third over the past year, will virtually disappear

We saw this sort of thing coming a year ago. But the wise ones said, “to be in Tahrir Square tonight, to feel the energy and pride of a people taking back the keys to their country and their future from a tired old dictator, was a privilege.”

A modest lede from CBS: “A military judge has recommended no time in confinement for a Marine sergeant.” The underlying story can’t have been such a big deal, but then why then did it take seven years to adjudicate? (Bruce Kesler has been covering this story since it began so long ago in 2005. It looked pretty fishy to us too, way back when.) Again, why such a long time to get to a conclusion? Among other things, a US congressman went on the record in November 2005: “they killed innocent civilians in cold blood.” And the clock began to tick.

The guy is up for parole. No kidding.

Since at least the time of Rick Santelli’s Tea Party rant, we have been witnessing some seismic changes in American politics. Independents flipped by 33 points in 2010 after all. But to many of the powers that be, it’s as though that never happened. Flash forward to the extraordinary GOP primary season. Candidate after candidate has surged and they have been characterized in their turn by the punditry and the media as the latest anti-Romney. That characterization misses the point. In our view the Republican primary voters have been sending a clear message that has has not varied all that much, though the vessels for the message have come and gone.

The latest vessel is Newt Gingrich, obviously flawed in many ways. But take a moment to read what he’s saying. It’s less the messenger than the message that has the power. We think that GOP primary voters believe that a minimally acceptable candidate articulating that message clearly and unapologetically is electable by a sizeable majority of voters. After all, in the wake of the ridiculous Keystone decision, even staunch liberals are shaking their heads about the disastrous course the administration has set for the country. We don’t recall a recent analogy to this bubbling up of opinion from the grass roots. (Eugene McCarthy’s strong losing performance in the 1968 New Hampshire primary comes to mind.) If the insiders don’t quite get what is going on, it wouldn’t be the first time.

A few days ago, Mitt Romney was ahead in SC, and it was all about Saul Alinsky versus Gordon Gekko, but it turned out that Newt Gingrich won handily. Here’s some of what he had to say (we could not find a transcript of Gingrich’s victory speech in South Carolina, so we essentially created one below):

So many people who are so concerned about jobs, about medical costs, about the everyday parts of life, and who feel that the elites in Washington and New York have no understanding, no care, no concern, no reliability, and in fact do not represent them at all.

In the last two debates we had…where people reacted so strongly to the news media, I think it was something very fundamental that I wish that the powers that be in the news media would take seriously. The American people feel that they have elites who have been trying for a half century to force us to quit being American and to become some kind of other system, and the reaction…People completely misunderstand what’s going on. It’s not that I am a good debater, it’s that I articulate the deepest held views of the American people…

If Barack Obama can get reelected after this disaster, just think how radical he would be in a second term…there are a number of key issues we have to talk about with the President. I believe this campaign comes down to economics, including jobs, economic growth, balancing the budget, the value of money, comes down to national security, what threatens us and what to do about it, but the centerpiece of this campaign is about American exceptionalism versus the radicalism of Saul Alinsky…

What we are going to argue is that American exceptionalism, the Declaration of Independence, the American Constitution, the American Federalist Papers, the Founding Fathers of America are the source from which we draw our understanding of America. He draws his from the Saul Alinsky, the radical left-wingers, and people who don’t like the classical America…

One of the keys issues, and I’m prepared to take this straight to the President and frankly, straight to the elite media…is the growing anti-religious bigotry of the elites…The second big theme that every South Carolinian understands is jobs, economic growth…I want to go into every neighborhood of every ethnic background in the country and say to the people very simply, if you want your children to have a life of dependency and food stamps, you have a candidate and that’s Barack Obama. If you want your children to have a life of indepedency and paychecks, you have a candidate and that’s Newt Gingrich…

Part of our long-term security interests is having an American energy policy. I want America to become so energy independent that no American President ever again bows to a Saudi King. Let me give you an example of a common sense conservatism that solves problems. You have well over $29 billion of natural gas offshore. As President I will authorize on the very first day the development of it. That natural gas will create jobs that, in Louisiana, average $80,000 apiece. In addition, it generates royalties. Part of the royalties should be used to modernize the port of Charleston, which affects 1 out of every 5 jobs in South Carolina.

But it’s not enough just to find the money. The Corps of Engineers bureaucracy is so long and so stupid that they currently take 8 years to study, not to do the project but to study the project. We fought the entire Second World War in 3 years and 8 months. Now if you can beat Nazi Germany, fascist Italy and Imperial Japan in 3 years and 8 months, it is almost unimaginable that it now takes 8 years to study the project…

The President’s decision to veto the Keystone pipeline…you have to wonder how out-of-touch with reality this administration is…The President says, no, we don’t want you to build a pipeline from central Canada straight down, with no mountains intervening, to the largest petrochemical center in the world, Houston, so that we would make money on the pipeline, we would make money on managing the pipeline, we would make money on refining the oil, and we would make money in the ports of Galveston and Houston shipping the oil.

Oh no, we don’t want to do that because Barack Obama is taking care of his extremist left-wing friends in San Francisco. They think that will really stop the oil from getting out. No. Prime Minister Harper…is going to cut a deal with the Chinese, and they will build a pipeline straight across the Rockies to Vancouver. We will get none of the jobs, none of the energy, none of the opportunity. An American President who can create a Chinese-Canadian partnership is truly a danger to this country.

Gingrich certainly owes a great deal to the much-reviled media, and possibly to Romney’s mishandling of his tax issue. More surprises ahead no doubt, but even Romney partisans know that important changes are needed, and quick.

Malcolm Muggeridge:

the dreadful infection of journalism got into my system. Turning aside from the honorable occupation of teaching, I started writing articles about the wrongs of the Egyptian people, how they were clamoring, and rightly so, for a democratic setup, and how they would never be satisfied with less than one man one vote and all that went therewith…That at least was what I wrote in my articles, and they went flying over to England, and, like homing pigeons, in through the windows of the Guardian office in Manchester, at that time a high citadel of liberalism. That was where the truth was being expounded, that was where enlightenment reigned.

Of course that was in the 1920′s, but you can find the same sort of thing today.

IBD:

According to the BLS, the “labor force participation rate” — the ratio of the number of people either working or looking for work compared with the entire working-age population — is now 64%, down from 65.7% when the recession ended in June 2009. That’s the lowest level since women began entering the workforce in far greater numbers several decades ago. If you adjust for this drop, the unemployment rate would be close to 11%, instead of the official 8.5%.

Of course this has been the case for a long time now. Imagine how the media would be reporting unemployment, and indeed, will be reporting unemployment, if the White House changes hands this year.

VDH:

Obama made several recess appointments — a tactic that as a senator he once criticized — even though Congress was not in recess. In December, the president signed a $1 billion omnibus spending bill, but notified Congress that he might not abide by some of the very provisions he had just signed into law. During the Libya war, Obama felt that bombing Qaddafi’s forces did not really constitute military operations, and therefore he had no need to notify Congress under the War Powers Act. It is clear that Arizona is not trying to circumvent federal immigration law, but rather is desperately trying to find some way to enforce it, given that the Obama administration has selectively chosen not to do so. In response, the federal government is suing the state of Arizona, even as it assures illegal aliens that they will not be arrested if they have not committed a crime — as if Obama can by himself decide that illegally entering and residing in the United States is not a federal crime in the first place. President Obama argued that it was constitutional to force citizens to purchase federalized health care, and that all Americans would be subject to his new health-care law — except some 2,000 businesses and organizations that were given politically driven waivers. Obama decided to reverse the legal order of creditors in the bailout of a bankrupt Chrysler Corporation in favor of more politically suitable constituencies. The administration does not like the Defense of Marriage Act, and therefore announced that it won’t enforce it. When a federal judge struck down an Obama- administration ban on new leases for gas and oil drilling in the Gulf of Mexico, Obama for a time ignored the injunction. When a BP oil leak in the Gulf outraged America, the president met with company executives and announced that they had agreed to set up a $20 billion “fund” to pay for imminent damage claims — as if our chief executive now meets with culpable private businesses to assess what he thinks they should pony up to avoid federal retaliation…

on any given challenge Obama assesses the politics of favoring his constituency of the “poor” and “middle class,” and then uses the necessary legal gymnastics post facto to offer the veneer of lawfulness. If someone is breaking a federal “law” by entering Arizona illegally from Mexico, there must be a way to make the enforcer of that “law” the real suspect — given that a Sheriff Joe Arpaio is by allegiance of the privileged 1 percent and those whom he arrests most surely are not. Consumers are deemed to need federal help more than do lenders; accordingly, Congress “really” is now in recess. In other words, we are witnessing with this administration the ancient idea of the supposedly exalted ends justifying the somewhat ambiguous means — albeit dressed up in trendy Ivy League legalese and progressive moralizing. Our postmodern president is not content with just picking and choosing which laws he will follow in advancing his social agenda. The war against the myth of disinterested Western jurisprudence extends also to free-market economics, as we see with the monotonous demonization of the so-called 1 percent and those who make over $200,000 per year. Sometime after January 2009, we learned that the “wealthy” did not gain their riches by a wide variety of what we once thought were legitimate means — luck, inheritance, work, health, intelligence, expertise, experience, education, or an overriding desire for money and status, coupled with an avoidance of classical sins like sloth, crime, and drunkenness. Rather, we were taught that there was something else going on, something innately unfair in the manner in which we are arbitrarily compensated. In some sense, we are back to the old notion of a labor theory of value (e.g., an hour of working at Starbucks is inherently no less valuable to our society in terms of how much the worker should be paid than an hour crafting a deal at Goldman Sachs). The role, then, of government is not to ensure an equality of opportunity — which is impossible, given inherent and unending race, class, and gender exploitations — but to strive for an equality of result. That utopian task demands that the best and the brightest in government redistribute capital, or rather use the state to make right what the private sector has distorted.

And this from the head of one of our political parties: “The discourse in America, the discourse in Congress in particular…has really changed, I’ll tell you. I hesitate to place blame, but I have noticed it take a very precipitous turn towards edginess and lack of civility with the growth of the Tea Party movement.” Already, “the Department of Homeland has been operating a ‘Social Networking/Media Capability’ program to monitor the top blogs, forums and social networks online for at least the past 18 months.” Hard to imagine what 2013-2017 America is going to look like if these folks aren’t shown the door.

The WSJ discusses Bain Capital’s investments:

22% either filed for bankruptcy reorganization or closed their doors by the end of the eighth year after Bain first invested, sometimes with substantial job losses. An additional 8% ran into so much trouble that all of the money Bain invested was lost…Bain produced about $2.5 billion in gains for its investors in the 77 deals, on about $1.1 billion invested. Overall, Bain recorded roughly 50% to 80% annual gains in this period, which experts said was among the best track records for buyout firms

Here are a few thoughts on the non-VC PE industry. KKR was started in 1976. and initally capitalized on low stock market valuations to take companies private at very low EBITDA multiples. Excellent idea. Around the same time the mainstreaming of hostile takeovers by Morgan Stanley’s Bob Greenhill and attorney Joe Flom meant that a going-private transaction did not have to be voluntary. (We once attended a meeting with a public company director who pleaded that we find someone to do a hostile takeover of his company because the CEO was so awful.)

The emergence of Mike Milken’s junk bonds in the 1980′s accelerated going-private transactions. In addition, acquirors had the ability to allocate basis among subsidiaries of the acquiree (“mirrors“) so that they paid no taxes on the operations they sold off to pay down debt. An attorney famous for defending targets of the takeovers called them junk-bond, bust-up, bootstrap deals. These developments arguably contributed to CEO’s being better stewards of public company assets. Bain Capital was founded in 1984, towards the end of the first phase of large PE deals. It looks as though the firm did start-up and growth capital deals at first and migrated into troubled situations sometimes referred to as vulture capital.

We’ve never done business with Bain Capital, though we’ve been involved as an agent and principal in the PE business for several decades. It has been our general observation that bankers and finance guys generally don’t know too much about business operations, but business operations get translated into numbers, and they know the numbers. It has surprised us that PE has been portrayed as both the Second Coming and the Devil’s Spawn by elements within the GOP. It’s neither of course.

We agree that the young-rich know-nothing banker with his 2+20 cap-gains-on-the-carry compensation scheme creates an image issue. But there’s this on the other side after all. As MoDo wrote, “a prospective race between Barack Obama and Mitt Romney is being caricatured here as ‘Saul Alinsky versus Gordon Gekko’.” We agree with roughly 50% of that.

A fansite report from 2009 describes a splashy party at the WH that the national media ignored:

Depp & Burton Attend Whitehouse Halloween Party ~- President Barack Obama and first lady Michelle Obama on Saturday handed out treats to more than 2,000 trick-or-treaters, marking their Halloween at a White House event partly aimed at honoring military families. Johnny Depp & Tim Burton were amoung the attendess at the Whitehouse Halloween Party and apparently Johnny was very popular with the children because of his Jack Sparrow character from Pirates Of The Caribbean. It is not known yet if Depp & Burton dressed up for the Party but we do know there was some characters from The Night Before Christmas and apparently a tea party with the Mad Hatter….could this have been Johnny Depp?

(Since this report came from a dedicated fansite, it missed or overlooked Chewbacca’s attendance at the fancy party.) This tiny story serves to illustrate that the media are even more pathetic, unprofessional and subservient than we thought.

The deputy editorial page editor of the Washington Post:

the president’s biggest failures have been his own ideas….Obama arrived in office afire with the ambition to create a Palestinian state within two years. But his diplomacy was based on a twofold misunderstanding: that the key to successful negotiations was forcing Israel to stop all settlement construction — and that the United States had the leverage to make that happen.

Veterans of the Middle East “peace process” shook their heads in wonderment as what at first appeared to be a rookie error evolved into a two-year standoff between Obama and Israeli Prime Minister Benjamin Netanyahu. There was only one possible explanation for this persistence in futility: The president himself was fixed on it.

Obama’s next big project was global nuclear arms control — an initiative so impressive to Norwegians that it won him the Nobel Peace Prize before he could act on it. Yet the results to date hardly seem prizeworthy. The New Start nuclear arms agreement with Russia merely ratifies warhead reductions already underway in Russia, while imposing a modest cut on the U.S. arsenal. More ambitious multilateral initiatives by Obama — to control nuclear materials, for example — have made little progress, despite an elaborate summit the president hosted in 2010.

Here again there appears to be a disconnect between Obama’s 1970s-vintage ideas and the real world of the early 21st century. There’s nothing wrong, and modest good, in extending Cold War nuclear conventions with Russia, or extracting highly enriched uranium from Ukraine and Chile. But the most dangerous proliferation threats emanate from countries that don’t attend summits or sign international treaties, such as North Korea and Iran. In terms of nuclear capability, both are ahead of where they were in 2009.

This brings us to Obama’s most distinctive — and most ill-fated — idea, and the one most identified with his 2008 campaign: the determination to “engage” with U.S. adversaries such as Iran, North Korea, Syria and Venezuela. Obama promised “direct diplomacy” — even one-to-one meetings — with the likes of Ayatollah Ali Khamenei and Kim Jong Il. More broadly he made the case that the United States could benefit by reaching out to autocratic regimes…

In his first year Obama dispatched two letters to Khamenei while keeping his distance from the revolutionary Green movement. He shook hands with Hugo Chavez. He launched a “reset” of relations with Russia’s Vladi­mir Putin and dispatched envoys to reason with Bashar al-Assad in Damascus. He delivered a sweeping address to the Muslim world from Cairo.

The results have been meager. Khamenei spurned the U.S. outreach. Relations with Putin warmed for a time but now have grown cold again. In Egypt and across the Middle East, the president’s popularity is lower today than when he gave the Cairo address.

The Post offers no explanation for the litany of failures it cites. Remarkable enough that a Democrat wrote the piece. We’ll leave it to VDH to provide a rationale: “American foreign policy is now becoming an extension not of classically liberal values, but of progressive suspicions of constitutional government, capitalism, and the historical role of the United States in particular and the West in general. The bowing to foreign potentates, the sad historical fabrications in the Cairo speech, the self-serving nonsense that arose in the first Al-Arabiya interview, and the so-called ‘apology tour’ were simply superficial manifestations of a deeper ambiguity about America.” He’s being charitable.

Not Tom Friedman:

it is manifest that during the time men live without a common power to keep them all in awe, they are in that condition which is called war; and such a war as is of every man against every man. For war consisteth not in battle only, or the act of fighting…as the nature of foul weather lieth not in a shower or two of rain, but in an inclination thereto of many days together: so the nature of war consisteth not in actual fighting, but in the known disposition thereto…

In such condition there is no place for industry, because the fruit thereof is uncertain: and consequently no culture of the earth; no navigation, nor use of the commodities that may be imported by sea; no commodious building; no instruments of moving and removing such things as require much force; no knowledge of the face of the earth; no account of time; no arts; no letters; no society; and which is worst of all, continual fear, and danger of violent death; and the life of man, solitary, poor, nasty, brutish, and short.

Egypt is a country with no democratic tradition, over 40% illiteracy and grinding poverty. Terrible unemployment and underemployment. And a 65% vote in favor of more of the same. So who is closer to understanding Egypt, the Tom above or the NYT’s Tom?

Tom Friedman in the NYT:

the Islamist parties — the Muslim Brotherhood and the Salafist Al Nour Party — just crushed the secular liberals, who actually sparked the rebellion here, in the free Egyptian parliamentary elections, winning some 65 percent of the seats. To not be worried about the theocratic, antipluralistic, anti-women’s-rights, xenophobic strands in these Islamist parties is to be recklessly naïve. But to assume that the Islamists will not be impacted, or moderated, by the responsibilities of power, by the contending new power centers here and by the priority of the public for jobs and clean government is to miss the dynamism of Egyptian politics today.

Flashback: “to be in Tahrir Square tonight, to feel the energy and pride of a people taking back the keys to their country and their future from a tired old dictator, was a privilege.”

NY Post:

“The Obamas,” by New York Times correspondent Jodi Kantor, tells of the first Halloween party the first couple feted at the White House in 2009…George Lucas sent the original Chewbacca to mingle with invited guests…“White House officials were so nervous about how a splashy, Hollywood-esque party would look to jobless Americans — or their representatives in Congress, who would soon vote on health care — that the event was not discussed publicly…

the White House made certain that more humble Halloween festivities earlier that day — for thousands of Washington-area schoolkids — were well reported by the press corps. Then the Obamas went inside, where an invitation-only affair for children of military personnel and White House administrators unfolded in the East Room…

the State Dining Room had also been transformed into a secretive White House Wonderland. Tim Burton decorated it “in his signature creepy-comic style. His film version was about to be released, and he had turned the room into the Mad Hatter’s tea party, with a long table set with antique-looking linens, enormous stuffed animals in chairs, and tiered serving plates with treats like bone-shaped meringue cookies,” reports the book…“Fruit punch was served in blood vials at the bar. Burton’s own Mad Hatter, the actor Johnny Depp, presided over the scene in full costume, standing up on a table to welcome everyone in character.”

Comments: (a) did reporters really not know about this — hard to believe; (b) no wonder the administration kept it secret; (c) also from that time period, compare and contrast; and (d) added bonus, Shrinkwrapped’s take from election night 2008.

Liberal journalist Charles Lane was lead editor of The New Republic at the time of Shattered Glass. He’s now on the editorial board of the Washington Post. We were going to pass by this sad story of crazy partisanship, but we pause to note Lane’s loss as well.

Recess appointments when the Senate’s not in recess? Sure, why not? These guys are committed and disciplined. And if the media don’t care, why should you?