The “Sahm Rule”, pictured in a graph from the St. Louis Federal Reserve above, was designed as a real-time leading indicator of recession. Here’s the description of our present situation from the American Institute of Economic Research:

In this morning’s US Bureau of Labor Statistics data release, the U-3 unemployment rate increased 4.1 percent in June 2024, rising by one-tenth of a percentage point above the forecast rate. The U-3 rate measures the percentage of the civilian labor force that is jobless, actively seeking work, and available to work, excluding discouraged workers and the underemployed.

This uptick triggers the Sahm Rule, a real-time recession indicator, suggesting that the US economy is in, or is nearing, a recession. The Sahm Rule, developed by former Fed economist Claudia Sahm, is designed to identify the start of a recession using changes in the total unemployment rate. According to the rule, a recession is underway if the three-month moving average of the national unemployment rate rises by 0.50 percentage points or more, relative to its low during the previous 12 months. With the June 2024 U-3 rate of 4.1 percent, the average of the last three months being 4.0 and the lowest 12-month rate of 3.5 percent in July 2023, this criterion has been met.

While not going so far as to predict a recession they conclude:

While more data will be required to confirm the Sahm Rule indication, the impact of accelerating prices, interest rates at their highest levels since 2007, and commercially suppressive pandemic policies have probably caught up with US producers and consumers.

Yesterday I pointed out that the relationship between full-time and part-time shops suggested recession. Here’s another leading indicator.

I honestly don’t know what is going to happen—we’re in unknown territory. The U. S. economy has never been exposed to such a large debt overhang in peacetime, particularly with the economy as deindustrialized as it is now. The political instinct will be to spend more, especially during an election year, which would push in the opposite direction as Fed policy.

I don’t follow the Bureau of Labor Statistics Employment Situation Report as faithfully as I used to. My loss of interest started when I understood how unempirical the numbers they are reporting are. However, this month’s caught my interest when I read that the number of full-time jobs decreased by 1.6 million while the number of part-time jobs increased by 1.8 million so decided to dig into it a bit. The first thing I wanted to show you was this, the age-adjusted figures for full-time and part-time employment over time:

The numbers are noisy to be sure but the trend certainly looks more characteristic of the leading edge of a recession than of boom time. You might also be interested in the video version of Ms. Nash’s presentation:

This graphic also strikes me as interesting:

Find more statistics at Statista
I’m not exactly sure what to conclude from that bar chart but I’m more confident in something you cannot conclude from it. We don’t need more workers in Agriculture or Leisure and hospitality but we may in the highly subsidized Education and health services.

Here in Chicago the 4th of July weekend has historically been the one weekend of the year with the highest number of homicides. Based on the statistics produced at Hey,Jackass! 2024 has already exceeded the number of homicides in the two prior years and may well exceed the number in 2021 and 2022. 17 people have been killed and 81 wounded. And that doesn’t include the man who blew his own head off with fireworks.

With Sunday night left to go who knows how high the tally will climb?

Update

The final tally is 19 killed, 85 wounded. As awful as that is it’s actually a relief that the number killed does not exceed the number in the Fourth of July weekend of 2021 or the Fourth of July weekend of 2020.

I found this piece by Tim Hains at RealClearPolitics on historian Alan Lichtman’s method for predicting the outcomes of presidential elections thought-provoking:

President Biden is under mounting pressure to drop his bid for a second term. In this interview with the Wall Street Journal, American University Historian Allan Lichtman, who correctly predicted nine of the last ten presidential elections using his system of “13 keys to the White House,” breaks down why Biden still represents the best bet for Democrats.

“American presidential elections are essentially votes up or down on the strength or performance of the White House Party. In other words, it is governance, not campaigning that counts,” Lichtman said. “It is still the best bet for Democrats to have Biden stay in the race.”

“The 13 keys to the White House are 13 true/false questions pertaining primarily to the strength and performance of the White House party, that when answered true, always favor stability. If six or more of the keys are false, we have earthquakes. If fewer than six are false, we have stability.”

Here are the thirteen questions:

1. Incumbent seeking re-election
2. No primary contest
3. Party mandate
4. Strong short-term economy
5. Strong long-term economy
6. Major policy change
7. No scandal
8. Charismatic incumbent
9. Uncharismatic challenger
10. No significant third party
11. No social unrest
12. No major foreign/military failure
13. Major foreign/military success

Without going to the linked piece to confer with Dr. Lichtman’s answers to those question, I challenge my readers to answer them for themselves. I will be interested in seeing your answers.

My reaction was that some of those questions (e.g. 1, 2) are objective but many are subjective (e.g. 8, 9). Consequently, your answers may well be different from Dr. Lichtman’s and may suggest a different outcome. That would account for a lot of the comments to Mr. Hains’s post and Dr. Lichtman’s answers in particular which I found pretty shocking.

Update

Ray Fair continues to predict that based on his Fair Model President Biden will receive a majority of the popular vote and that if Biden does not run the Democratic candidate would receive a lower percentage of the popular vote. How that translates to being elected president is outside the scope of his model.

I wonder if there are a lot of Democrats thinking what David Axelrod actually says in his piece at CNN:

After the debate, the already robust number of Americans who deem the president too old to serve another term went up to 74%. Only 42% said the same about Trump, 78, whose own terrible debate performance was eclipsed by Biden’s meltdown.

Just as distressing was Biden’s stubborn denial of his public standing and position in a race that he has characterized as an existential battle for the survival of American democracy.

Three separate polls conducted by CNN, The New York Times and the Wall Street Journal after the debate all showed Biden trailing Trump by six points nationwide. Previous polls have shown Biden trailing in nearly all the battleground states he narrowly won in 2020. And now a handful of other states he won — Minnesota, New Hampshire, New Mexico and Virginia — appear to be in play.

At this rate, Biden is likely headed for a landslide defeat to a lawless and unpopular former president.

But when Stephanopoulos confronted him with poll numbers showing him trailing and a job approval rating lower than any president who has ever won re-election, Biden would have none of it.

“I don’t … I don’t buy that. I don’t think anybody’s more qualified to be president or win this race than me,” he said.

Only “the Lord Almighty” could persuade him to give up the race, the president said, as a growing chorus of Democrats, fearful of an electoral disaster, call for him to step aside.

Denial. Delusion. Defiance.

My take is that if you’re going to base your campaign around your opponent’s being a narcissist, delusional, a liar, and anti-democratic, the strategy for making that most effective is to be focused on the effect your actions have on others, acknowledge reality, adhere strictly to the truth, and advocate democratic means in your political choices.

I’m still deciding whether I will watch George Stephanopoulos’s interview of President Biden this evening. I probably will. It’s being described as a “high stakes interview”. Is that true? He’s being interviewed by a friendly interviewer who’s unlikely to be a tough interrogator.

IMO the only contingency under which it would be “high stakes” is if President Biden was unable to rise to the occasion and I honestly do not think that will happen. I think he will look and sound a little older but pretty much like the Joe Biden who campaigned in 2020.

But what does that prove? That he can sound like his old self? I have no doubt of that. It doesn’t prove that he will. That was proven by the “debate”: he might; he might not.

I think that what should happen is that President Biden should withdraw his name from candidacy and resign, turning the presidency over to Kamala Harris for the next six months. As I’ve said before, I don’t think that will happen.

Update

President Biden’s performance was better than I thought it would be but I doubt if he’s helped himself much with this interview. And George S. was a bit tougher than I expected. I suspect that the more his Democratic colleagues think about the president’s answer to George S.’s question (“How will you feel, etc.?”) the worse it will sound to them.

BTW my Congressional representative just asked President Biden to withdraw his candidacy.

I don’t recognize the United States anymore. I don’t know whether it’s because things have changed or we’re just aware of more nowadays or both.

The change in the politics is obvious. Both major political parties are more authoritarian than they used to be. That is so obvious I hardly feel the need to explain it. The media continually draw attention to the breach of the Capitol on January 6, 2020 but it’s not limited to that.

It is quite obvious at this point that Joe Biden has been declining mentally for some time and his staff and associates have been running the show, denying any decline all along. That itself is authoritarian. So is the Congress passing opaque laws which the executive branch agencies ignore or interpret any way they care to and defending that process as practical necessity.

That isn’t the way our political system is supposed to work. Congress is supposed to write the laws, they are to be enacted by the Congress and the president, and anything that’s not in the law is not in the law. Unelected federal agencies don’t get to extrapolate and interpolate at will.

The smallest Congressional district is now larger than the largest state in 1790. If we doubled the number of Congressional districts, each member of Congress would still represent more than twice as many people as each member of the House of Commons in the UK, the French National Assembly, or the German Bundestag.

The party leadership in each party wields far too much power and the two parties collude in preventing upstart splinter parties from getting onto the ballot. Congressional district are not only too large but gerrymandered ferociously to benefit whichever political party controls each state. The prevailing is that Republicans benefit more from this arrangement but that’s not what FiveThirtyEight found. Their analysis found that Democrats actually benefit more from gerrymandering. For an egregious example consider the Illinois 4th Congressional District. What would our political landscape look like with smaller, non-gerrymandered, more compact districts? We have no idea.

When I started this blog the president of the United States was the son of a prior president, the governor of my state was the son-in-law of a powerful Chicago City Council member, and the City Council member who represented my ward was the daughter of her predecessor. To my eye the distinction between that and a hereditary aristocracy is notional at best.

It’s even worse now if anything. The president has held elective office for more than 50 years. He was an undistinguished member of the Senate for most of that time, then an undistinguished Vice President. His competitor in the coming election is 78 and a billionaire without prior experience in government or politics. The last two governors of Illinois have both been billionaires with zero prior experience in elective office or government.

The change in the society is notable as well. We have the largest percentage of foreign born in the country in a century, possibly the largest percentage in history. The non-marital birth rate is around 40%—roughly what it has been since 2008 and sharply higher than it was a generation ago. Among black Americans nearly 70% are born to unmarried mothers.

The virtues that made the United States stand out among countries including voluntarism and contributing to charities has declined sharply. The participation in organized religion has declined as well.

We have been at war now continually for more than 30 years. We don’t call it that but that’s the case. The evidence all of that warmaking has made us more secure is negligible.

Alone among developed countries the life expectancy here is actually declining. The number of deaths due to drug abuse is almost 10 times what it was 25 years ago. I could go on but it’s too depressing.

I wanted to commend Amy Howe’s post at SCOTUSBlog on Trump v. United States to your attention. Here’s a snippet:

In a ruling on the last day before the Supreme Court’s summer recess, and just over two months after the oral argument, a majority of the court rejected the D.C. Circuit’s reasoning. As an initial matter, Roberts explained in his 43-page ruling, presidents have absolute immunity for their official acts when those acts relate to the core powers granted to them by the Constitution – for example, the power to issue pardons, veto legislation, recognize ambassadors, and make appointments.

That absolute immunity does not extend to the president’s other official acts, however. In those cases, Roberts reasoned, a president cannot be charged unless, at the very least, prosecutors can show that bringing such charges would not threaten the power and functioning of the executive branch. And there is no immunity for a president’s unofficial acts.

Determining which acts are official and which are unofficial “can be difficult,” Roberts conceded. He emphasized that the immunity that the court recognizes in its ruling on Monday takes a broad view of what constitutes a president’s “official responsibilities,” “covering actions so long as they are not manifestly or palpably beyond his authority.” In conducting the official/unofficial inquiry, Roberts added, courts cannot consider the president’s motives, nor can they designate an act as unofficial simply because it allegedly violates the law.

Turning to some of the specific allegations against Trump, the majority ruled that Trump cannot be prosecuted for his alleged efforts to “leverage the Justice Department’s power and authority to convince certain States to replace their legitimate electors with Trump’s fraudulent slates of electors.”

With regard to the allegation that Trump attempted to pressure his former vice president, Mike Pence, in his role as president of the senate, to reject the states’ electoral votes or send them back to state legislatures, the court deemed Trump “presumptively immune” from prosecution on the theory that the president and vice president are acting officially when they discuss their official responsibilities. On the other hand, Roberts observed, the vice president’s role as president of the senate is not an executive branch role. The court therefore left it for the district court to decide whether prosecuting Trump for this conduct would intrude on the power and operation of the executive branch.

The court did the same for the allegations in the indictment regarding Trump’s interactions with private individuals and state officials, attempting to convince them to change electoral votes in his favor, as well as Trump’s tweets leading up to the Jan. 6 attacks and his speech on the Ellipse that day. Making this determination, Roberts wrote, will require “a close analysis of the indictment’s extensive and interrelated allegations.”

I honestly don’t know what to think about the decision. I’ve scanned both the majority decision, the concurrences, and the dissents. To my eye both the majority and the dissent were emphasizing policy over the law which I emphatically do not believe is the job of the Supreme Court in this or any other matter.

I’ve been preparing a post on recent Supreme Court decisions, some of which have been quite significant in their implications, for some time. In thinking about these decisions I think there are two distinct issues:

1. Did they get the law right?
2. Are the majority or the dissent or both making policy rather than determining what the law is?

Most of the commentary I have seen talks almost exclusively about the policy but IMO policy is not the province of the courts—the law is. If you have a problem with the policy, your problem is with the Congress.

As of this writing the editors of the New York Times, Washington Post, Wall Street Journal, Chicago Tribune, and the Atlanta Journal-Constitution have called for President Joe Biden to end his re-election campaign. Others have called for Donald Trump to end his campaign. Columnists from across the political spectrum have called for President Biden to withdraw. Everything is proceeding largely as I predicted. I wish they would both terminate their campaigns. However, I am accustomed to not getting what I want.

The Biden campaign’s reaction reminds me of nothing so much as this sequence from the 1967 movie, Guide for the Married Man:

Frankly, as many have pointed out before me, I doubt that trying to convince people they did not see what they saw will be a winning strategy.

Update

Mike Allen and Jim VanderHei have a good post at Axios summing up the Biden campaign’s counterstategy. My favorite passage from it is this:

“You guys don’t get to decide,” a source close to Biden said, referring to high-profile Democrats now second-guessing Biden as nominee. “That’s not how this works. We don’t have smoke-filled rooms.”

No, we have smoke-filled “family gatherings”. There’s all the difference in the world. Especially when the family recognizes that their livelihoods depend on Joe Biden staying in office as long as possible.