The US Needs To Generate 262K JobsEach Month To Get Back To BreakEven

Zero HedgeFriday, April 6, 2012

This is the latest tally: since the start of the Second Great Depression, the US has lost a total of5.2 million nonfarm payroll jobs, beginning with 138 million jobs in December 2007, and printingat 132.8 million as of 90 minutes ago. So far so good. The problem, however is that thedenominator in the equation is not fixed, and as everyone knows the US labor force, despite theridiculous BLS data fudging, is growing in line with population, albeit at a slower pace.According to all non-partisan budget forecasters, each month the labor force should be adding90,000 people. Which in turn means that since December 2007, the labor force has really grownby 4.6 million. Adding these two together leads to a 10 million job deficit. So what has tohappen for these 10 million to get promptly put back into jobs, and for America to get back to the~5% unemployment rate it boasted just as the credit bubble peaked? Nothing too crazy: thecountry just has to create 262,000 jobs every month for the remainder of Obama’s first, and now,by the looks of it, second term too. We are quite confident he can handle it.

What Do Iran Sanctions Cost You? About 25Cents a Gallon, Experts Say

Howard LaFranchChristian Science MonitorApril 7, 2012

Twenty-five cents a gallon — that’s abouthow much some international energyexperts say the tough U.S. sanctions onIran’s oil industry are costing Americansat the pump.

As U.S. consumers cope with gas pricesthat are approaching an average of $4 agallon, some international trade expertssay the cost of the sanctions the U.S.imposes — as in the case of the Iranmeasures — is something political leadersshould discuss more openly. Instead, theysay, most politicians act as if sanctionsaffect only the country targeted — something these experts say isn’t true.

“The approach is always that the costs are for them and the benefits are for us,” says Bill Reinsch,president of the National Foreign Trade Council (NFTC), a Washington lobbying organizationthat generally opposes economic sanctions. “The Iran case is interesting,” he adds, “because ofthe impact of sanctions on our energy sector.” Energy experts say it’s difficult to pinpointprecisely how much sanctions on Iran are costing consumers as they filter down to the gas pump.

But Lucian Pugliaresi, president of theEnergy Policy Research Foundation, aWashington nonprofit organization thatstudies energy economics, says it’s possibleto make an estimate.

The sanctions the U.S. and other countrieshave slapped on Iran’s energy sector and onits central bank (aimed at curtailing its oilexports) are costing Iran about 300,000barrels a day in exports, Mr. Pugliaresiestimates. When added to other factorsaffecting the international oil market, thatdecrease in exports may have added about$10 to the current price of a barrel forcrude, he says.

And that $10 increase translates roughly toabout a 25-cent increase in the cost of a gallonof gas in the US, Pugliaresi says.

Of course the Iran sanctions — whichPresident Obama has continued to ratchet up,including at the end of March when he decidedto move forward with sanctions on Iran’sCentral Bank he had signed into law in January— are designed to dissuade Iran from pursuinga nuclear program with a weapons capability, agoal many consumers may agree with.

But the NFTC’s Mr. Reinsch says consumersshould be told what sanctions are going tocost.

“It’s a legitimate argument to say the benefitsof the aim of these sanctions — convincing Iran not to build nuclear weapons – outweigh theeconomic costs,” he says. “What is not acceptable is to pretend there are no costs, or to ignorethem.”

The Iran sanctions legislation that passed in January requires the president to consider the impactof moving forward on the central bank measures. Along with his decision in March to proceedwith implementation, Mr. Obama issued a memo saying that after “carefully considering” factorsincluding the state of the global economy, the availability of alternative oil supplies, and U.S. andother countries’ strategic reserves, he had determined that conditions existed to move forward.

Reinsch says his fire is aimed at the “hypocrisy” of members of Congress who press for ever-tougher sanctions on Iran’s oil sector, “but then turn around and complain about prices at thepump” as if there were no connection.

Another factor critics of sanctions raise is whether or not they are having the intended impact.Economists and regional experts generally agree that the sanctions on Iran are having an impact

on the country’s economy. But less certain, critics say,is whether or not that will translate into the Iranianregime backing down on its nuclear ambitions.

In any case, Pugliaresi says consumers can take heart inthe fact that the oil futures market seems to see thefactors keeping crude oil prices up as temporary andmoderating within a couple of years. Which means gasprices should be able to come back down — barring ofcourse some other crisis in supply markets.