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These Are The 7 Most Telling Economic Charts of 2012

Dec. 21, 2012 4:30pm

If nothing else, 2012 will be remembered for the roller-coaster ride that was the U.S. economy. There were dives in stocks, increases in “income inequality,” gains made in the housing sector, and contractions in manufacturing.

And here to help us recap the economic ups and downs of 2012 are seven charts handpicked by the American Enterprise Institute’s James Pethokoukis [all block quotes via AEI]:

1. The Obama White House’s Debt Forecast

Here are 7 Charts That Pretty Much sum up the U.S. Economy in 2012

The president’s own Office of Management and Budget produced this chart showing the long-term fiscal impact of the administration’s 2013 budget plan. When House Budget Chairman Paul Ryan showed Treasury Secretary Timothy Geithner this chart, Geithner responded, “We’re not coming before you to say we have a definitive solution to that long-term problem. What we do know is we don’t like yours.”

2. The collapse of the labor force participation rate:

Here are 7 Charts That Pretty Much sum up the U.S. Economy in 2012

If the labor force participation rate was at its January 2009 level, the unemployment rate would be a whopping 10.7%. Some of the drop in the LFP is due to demographic reasons, primarily the aging of the US population. But even taking that into account would give you a much higher unemployment rate than the current 7.7%. If you go by the pre-recession CBO forecast of the 2012 LFP rate, the unemployment rate would be 10.4%.

3. Workers as a share of the population

Here are 7 Charts That Pretty Much sum up the U.S. Economy in 2012

The number of Americans working as a share of the population, perhaps the broadest measure of the health of the US labor market, remains in a depression. It plunged during the Great Recession and has yet to recover.

4. The Jobs gap

Here are 7 Charts That Pretty Much sum up the U.S. Economy in 2012

The economy is slowly creating jobs, but the Jobs Gap isn’t closing. The US lost 9 million private sector jobs during the Great Recession. Since job growth resumed, 5 million private sector jobs have been created. But as measured by economist Michael Darda of MKM Partners, the level of private sector jobs remains 13 million below the pre-crisis trend.

5. The Growth Gap

Here are 7 Charts That Pretty Much sum up the U.S. Economy in 2012

Likewise, the Growth Gap — where GDP is today versus its long-term trend line — also isn’t closing. If the recovery had been stronger, putting growth back on its traditional pace, cumulative GDP over the past five years would have been roughly $10.3 trillion higher.

6. Median Household Income

Here are 7 Charts That Pretty Much sum up the U.S. Economy in 2012

Has the US median household income really stagnated over the past 30 years, as many liberals charge? No. This is a table rather than a chart, but it is still illustrative. Economist Richard Burkhauser of Cornell University found that when you properly measure household size and factor in transfer payments and the progressive tax code, real incomes actually rose nearly 40% over the period.

7. The Obama Admin.’s Unemployment Prediction

Here are 7 Charts That Pretty Much sum up the U.S. Economy in 2012

2012 was another bad year for perhaps the most infamous economic prediction in US political history. In January 2009, Obama economic advisers Jared Bernstein and Christina Romer said unemployment — as reflected in the chart they created — would not hit 8% if Congress passed the stimulus. Not only did unemployment actually hit 10%, but it is still way above their 2012 estimate of 5.2%.

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Comments (24)

  • NoLongerNonPlussed
    Posted on December 23, 2012 at 10:25pm

    Why is everyone trying to confuse us with confusing charts and actual facts. America has elected a real, honest to goodness president to tell us the truth and to lead us all out of the desert. Please stop worrying. Everything will be fine. These are not the droids you’re looking for. There is nothing to see here. signed: B.H. Obiwan

    Have a Happy Christmas and a very merry new year. Please stay off all the roads if you party, ’cause we need you here to pay for the 47%’s tax rebates in 2013.

    TEA

    Report this comment

    NoLongerNonPlussed  
  • overthecliff
    Posted on December 23, 2012 at 4:13pm

    Argentina is starting to come unglued. Coming to USA soon.

    Report this comment

    overthecliff  
  • AbrahamsSheepdog
    Posted on December 22, 2012 at 12:57pm

    They can’t even run a rigged casino. Sigh

    Report this comment

    AbrahamsSheepdog  
  • Zorro1
    Posted on December 22, 2012 at 12:47pm

    Capital Depletion
    People are employed by businesses owning farms, factories, facilities and offices that utilize machinery and equipment to produce goods inventories and services for consumers in exchange for money.
    People use money either to consume goods and services or to save as capital. But, in order to survive, people must consume some or all of their money on food, shelter, clothing and healthcare.
    The creation and survival of employers requires unconsumed money that is invested in savings and then channeled to businesses directly by the saver of through intermediaries.
    The continuous formation of capital is crucial to economic growth. Thus, there was a time, and not so long ago, that people were encouraged to save, and through “the magic of compound interest”, build a capital base for investment in their or other’s businesses, retirement or for a “rainy day.”
    An important incentive to build a capital base had been the possibility of it providing sufficient income to meet survival needs after retirement when one must live on a “fixed income.” But, if investment returns (interest and/or dividends) are too small to meet survival expenses, it becomes necessary to convert capital to consumption.
    Such capital depletion is the opposite of what is needed for economic growth. Yet, today’s negligible interest rates don’t provide most retired savers the money they need for even minimal living expenses. So, they spend their capital to make ends meet

    Report this comment

    Zorro1  
    • Zorro1
      Posted on December 22, 2012 at 1:22pm

      Last sentence was left off “Capital Depletion” above.
      It is:
      And, when inflation-adjusted interest rates are negative, there is no incentive for the still-emplyed to create new savings.

      Report this comment

      Zorro1  
  • SGT Rock
    Posted on December 22, 2012 at 2:05am

    I have begun to research into what happened to the Soviet Union when and why t fell after a Russian I know told me it is happening here like in Russia. He is right, the scary thing is I don’t think we will bounce back since we have exhausted everything here and blocked what was not with EPA laws. We are doomed, i’m done bailing water on this sinking ship, i’m putting on life jackets now and making my way to the lifeboats because this ship is a goner. Women and children first, every man for himself.

    We need to have term limits on these dinosaurs in the House and Senate so we can inject new blood into the system, heck some of them have been in there longer than I have been alive. If 8 years is good enough for the President then 8 years max is good enough for them. get them and their cronies out of office.

    Report this comment

    SGT Rock  
    • December22
      Posted on December 22, 2012 at 6:44am

      All the financial people I see I CNBC seem totally oblivious to the economic realities that Obama has visited upon this country.

      Report this comment

      December22  
  • Anonymous T. Irrelevant
    Posted on December 21, 2012 at 5:14pm

    Got this joke on email today:
    The Republican
    A union boss walks into a bar next door to the factory and is about to order a drink to celebrate Obama’s victory when he sees a guy close by wearing a Romney for President button and two beers in front of him. He doesn’t have to be an Einstein to know that this guy is a Republican.

    So, he shouts over to the bartender so loudly that everyone can hear, “Drinks for everyone in here, bartender, but not for the Republican.”

    Soon after the drinks have been handed out, the Republican gives him a big smile, waves at him, then says, “Thank you!” in an equally loud voice. This infuriates the union boss.

    The union boss once again loudly orders drinks for everyone except the Republican. As before, this does not seem to bother the Republican. He continues to smile, and again yells, “Thank you!”

    The union boss once again loudly orders drinks for everyone except the Republican. As before, this does not seem to bother the Republican. He continues to smile, and again yells, “Thank you!”

    The union boss asks the bartender, “What is the matter with that Republican? I’ve ordered three rounds of drinks for everyone in the bar but him, and all he does is smile and thanks me. Is he nuts?”

    “Nope,” replies the bartender. “He owns the place.”

    Report this comment

    Anonymous T. Irrelevant  
  • Walkabout
    Posted on December 21, 2012 at 5:04pm

    How will the liberals & liberal trolls spin this?

    Report this comment

    Walkabout  
  • skippy6
    Posted on December 21, 2012 at 4:58pm

    When it collapses agenda 21 will save us…….Don’t worry be happy….

    Report this comment

    skippy6  
  • bobinmichigan
    Posted on December 21, 2012 at 4:51pm

    Read the book “Aftershock” to get a good idea about what is going on in the financial markets and government and what is coming our way. Not good.

    Report this comment

    bobinmichigan  
  • californiakhg
    Posted on December 21, 2012 at 4:48pm

    revolution is coming

    Report this comment

    californiakhg  
  • Patriot83
    Posted on December 21, 2012 at 4:43pm

    The amount of debt purchased by overseas purchasers have already diminished significantly. The Federal Reserve has been buying the majority of our debt since QE2. Basically, we just print more money, and we have more dollars purchasing fewer goods and services. Eventually, this will lead to pronounced inflation. Can anyone convince me I am wrong?

    Report this comment

    Patriot83  
    • antiprogressive
      Posted on December 22, 2012 at 4:08am

      Wouldn’t even try.
      And you are just scraping the icing off the cake.

      Report this comment

      antiprogressive  
    • Unix
      Posted on December 22, 2012 at 12:23pm

      Try STAGFLATION – high unemployment, stagnant wages and hyperinflation! Just look to 1930′s Germany, Russia, etc…our dear leader is orchestrating the downfall of America. Sad isn’t it?

      Report this comment

      Unix  
  • Impenitent
    Posted on December 21, 2012 at 4:35pm

    what do you mean?!? can’t you see it’s UTOPIA!!!!

    nobody works, everyone pays 100% taxes!!!

    freedom for everyone… wait, you can’t do that, you might hurt yourself and we can’t afford to pay for your medical treatments when you hurt yourself… here’s some food stamps!!! UTOPIA!!!

    Report this comment

    Impenitent  
  • Cavallo
    Posted on December 21, 2012 at 4:28pm

    Just wait until the suckers overseas wise up and stop buying our worthless paper.

    Report this comment

    Cavallo  
    • BTC55
      Posted on December 21, 2012 at 9:46pm

      They already have. The Fed just prints it now and holds the bonds.

      Report this comment

      BTC55  

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