10.2%

Unemployment formally has befallen more than 1 in 10 Americans. Including underemployment, we are looking at closer to 18% by most reports this morning. 1 in 5 Americans are having enormous trouble with their personal economic situations. This is a really, really big deal.

But it's not a new development. We hit this number, more or less, in April after four months of losing almost 700,000 jobs per month (you may not remember this figure because the reported numbers were initially smaller, but all were adjusted upward). By July, job losses had slowed to about 200,000 per month. This last month 190,000. This is a significant number because job losses happen every month even in the best economy. What is supposed to happen also is new hires. That's not happening yet. So we're seeing fairly normal loss numbers (according to Labor Dept spokesman last month), but not fairly normal gain numbers yet. Combined with economic growth that is now occurring in a GDP context, including the manufacturing sector and others, it is largely good news. Economic activity is returning. Factory orders are going up. Housing prices are, in some areas, beginning to rebound.

Of course, politically, all eyes are on the 2010 elections. In presidential elections, the "table" for the election is largely set by mid-summer. In offyear elections, the table gets set a bit after labor day. By this I mean that the public gets a fixed idea of what the state of the world is, and of what issues matter to them, by late September. After that, candidates can't argue about how the world is, they can only argue about what they will do about it. Recall in 1992 that the economic recovery began quite obviously in September 1992, but Clinton could run on recession because the public wasn't going to change its perception. So the real question is whether the public perceives that the recovery is underway by September 2010. Probably so.

In fact, the danger for the Democrats is that the existence of economic recovery becomes a non-issue by the summer. "What have you done for me lately" is a real danger. So, ironically, it is worth it to the Dems to not proclaim "victory" until the Summer.