Dead cat bounce

I have some doubts about yesterday’s unemployment report which unexpectedly showed the headline unemployment rate dropping.[1] Doubts, in fact, that make me suspect what some might call a “dead cat bounce.”

But before we even get to my doubts, the reporting includes some significant caveats on the apparent drop in the unemployment rate.[2] First, neither the April and May reports count many workers who expected to return to their jobs as permanently unemployed when, in fact, many of them will indeed be permanently unemployed. From last month:

We don’t really know how many folks are misclassified, either in April or May.

Which is to say that the undercount understates, to some unknown degree, the size of the already huge hole we have to dig ourselves out of.[3]

One has to wonder how we’re going to feel about that in a few months or years when second, the apparent drop in unemployment bolsters the case against further relief, a problem[4] when “with expanded unemployment benefits set to expire July 31, unemployed workers could struggle even more to pay bills, triggering a wave of defaults on credit card balances, car payments and mortgages.”[5] Which is pretty much what I’ve been saying—and about rent, too.[6]

That part about rent is a significant omission. The headline on Kriston Capps’ story is, “What Happens When the Eviction Bans End?”[7] So far, the answer is pretty much what I expected:[8] As courts return to session, there is a long line of eviction cases. And a lot of these folks will have trouble coming up with deposits even if, now that they’ve faced eviction, they can find a landlord willing to rent to them. A lot of them will wind up homeless. Even when they have kids.[9] But ya know, property rights, baby, property rights.[10]

I’ve actually witnessed eviction hearings. It was when I was living at Lupin Lodge, in the Santa Cruz Mountains above Los Gatos, California, and we were trying to evict an asshole who had taken over the place (a long story which begins here). And what Capps describes of these hearings is about right.[11] Most people don’t show up—indeed, other than in the case of Lupin, I don’t recall seeing a single case where one did—so it’s the landlord’s lawyer speaking not only on the landlord’s behalf but on the tenant’s, with the predictable spin on the latter. Even in the case of that asshole at Lupin, who had a lawyer, it really all came down to a boilerplate routine with the landlord winning every time.

Eviction really is as simplistic, brutal, and heartless as that, even for non-assholes whose only fault is having been caught out first by the profound inequities in our society, second by a pandemic lockdown, and third by a neoliberal refusal to address their needs.[12]

So what happens as these ripples spread out, first affecting smaller businesses who are owed money on what are now bad debts, and second affecting the bigger businesses that served them? When businesses fold, perhaps even probably because they can’t collect the money they’re owed, layoffs ensue. Hence the “dead cat bounce.”

Then there’s the matter that the novel coronavirus is still out there. What happens when there’s a ‘second wave’[13] and there is still no ‘herd immunity,’ still no vaccine, and still no cure? Because we have absolutely no assurance, and in fact considerable reason to doubt that there will be a vaccine or a cure anytime soon. We don’t know that these things are even possible with COVID-19.[14] Will we, due to our adherence to an intellectually utterly discredited neoliberal ideology,[15] simply rinse and repeat our woefully inadequate, even flat-footed, response this time?

Allegheny County emerged from ‘yellow’ phase into ‘green’ phase yesterday, and I sat down in a restaurant for a meal for the first time in a while. There is an overwhelming sense, even as face masks continue everywhere to be seen and the tables available for seating are widely spaced, that the crisis is over, the pandemic and its economic effects are behind us. Certainly, that’s what many politicians would like us to believe.

But the truth is that this optimism places a lot of faith in medical progress and in neoliberal ideology. I’m a pessimist whose pessimism is buttressed by a substantial skepticism about what remains to be seen.

  1. [1]Eric Levitz, “Why the Shockingly Good Jobs Report Might Be Bad News,” New York, June 5, 2020, https://nymag.com/intelligencer/2020/06/unemployment-jobs-report-congress-bls.html; Eli Rosenberg, “Unemployment rate drops to 13 percent, as the economy picked up jobs as states reopened,” Washington Post, June 5, 2020, https://www.washingtonpost.com/business/2020/06/05/may-2020-jobs-report/
  2. [2]Eric Levitz, “Why the Shockingly Good Jobs Report Might Be Bad News,” New York, June 5, 2020, https://nymag.com/intelligencer/2020/06/unemployment-jobs-report-congress-bls.html; Eli Rosenberg, “Unemployment rate drops to 13 percent, as the economy picked up jobs as states reopened,” Washington Post, June 5, 2020, https://www.washingtonpost.com/business/2020/06/05/may-2020-jobs-report/
  3. [3]Eric Levitz, “Why the Shockingly Good Jobs Report Might Be Bad News,” New York, June 5, 2020, https://nymag.com/intelligencer/2020/06/unemployment-jobs-report-congress-bls.html; Eli Rosenberg, “Unemployment rate drops to 13 percent, as the economy picked up jobs as states reopened,” Washington Post, June 5, 2020, https://www.washingtonpost.com/business/2020/06/05/may-2020-jobs-report/
  4. [4]Eric Levitz, “Why the Shockingly Good Jobs Report Might Be Bad News,” New York, June 5, 2020, https://nymag.com/intelligencer/2020/06/unemployment-jobs-report-congress-bls.html; Eli Rosenberg, “Unemployment rate drops to 13 percent, as the economy picked up jobs as states reopened,” Washington Post, June 5, 2020, https://www.washingtonpost.com/business/2020/06/05/may-2020-jobs-report/
  5. [5]Eli Rosenberg, “Unemployment rate drops to 13 percent, as the economy picked up jobs as states reopened,” Washington Post, June 5, 2020, https://www.washingtonpost.com/business/2020/06/05/may-2020-jobs-report/
  6. [6]David Benfell, “An impatient capitalist god demands human sacrifice. Now,” Not Housebroken, April 17, 2020, https://disunitedstates.org/2020/04/15/an-impatient-capitalist-god-demands-human-sacrifice-now/
  7. [7]Kriston Capps, “What Happens When the Eviction Bans End?” CityLab, May 29, 2020, https://www.citylab.com/equity/2020/05/pay-rent-eviction-ban-coronavirus-housing-crisis-landlord/612277/
  8. [8]David Benfell, “When nothing happened next,” Not Housebroken, March 29, 2020, https://disunitedstates.org/2020/03/29/when-nothing-happened-next/
  9. [9]Kriston Capps, “What Happens When the Eviction Bans End?” CityLab, May 29, 2020, https://www.citylab.com/equity/2020/05/pay-rent-eviction-ban-coronavirus-housing-crisis-landlord/612277/
  10. [10]David Benfell, “When nothing happened next,” Not Housebroken, March 29, 2020, https://disunitedstates.org/2020/03/29/when-nothing-happened-next/
  11. [11]Kriston Capps, “What Happens When the Eviction Bans End?” CityLab, May 29, 2020, https://www.citylab.com/equity/2020/05/pay-rent-eviction-ban-coronavirus-housing-crisis-landlord/612277/
  12. [12]Anne Applebaum, “The Coronavirus Called America’s Bluff,” Atlantic, March 15, 2020, https://www.theatlantic.com/ideas/archive/2020/03/coronavirus-showed-america-wasnt-task/608023/; David Benfell, “Elite priorities: Why social, animal, and environmental justice remains essential with COVID-19,” Not Housebroken, April 26, 2020, https://disunitedstates.org/2020/04/26/elite-priorities-why-social-animal-and-environmental-justice-remains-essential-with-covid-19/; David Blanchflower, “Pandemic Economics: ‘Much Worse, Very Quickly,” New York Review of Books, March 26, 2020, https://www.nybooks.com/daily/2020/03/26/pandemic-economics-much-worse-very-quickly/; Zak Cheney-Rice, “Even Naked, America Cannot See Itself,” New York, April 27, 2020, https://nymag.com/intelligencer/2020/04/coronavirus-inequality-america.html; Amy Goldstein, “First, the coronavirus pandemic took their jobs. Then, it wiped out their health insurance,” Washington Post, April 18, 2020, https://www.washingtonpost.com/health/first-the-coronavirus-pandemic-took-their-jobs-then-it-wiped-out-their-health-insurance/2020/04/18/1c2cb5bc-7d7c-11ea-8013-1b6da0e4a2b7_story.html; William Gumede, “The impact of coronavirus could compare to the Great Depression,” Al Jazeera, May 3, 2020, https://www.aljazeera.com/indepth/opinion/impact-coronavirus-compare-great-depression-200420070542882.html; Kim Hart, “The coronavirus economy will devastate those who can least afford it,” Axios, March 23, 2020, https://www.axios.com/coronavirus-economy-layoffs-children-families-bad-d588cc93-ff26-4031-8be8-5654cce05a15.html; Zoë Hu, “A New Age of Destructive Austerity After the Coronavirus,” New Republic, April 23, 2020, https://newrepublic.com/article/157417/new-age-destructive-austerity-coronavirus; Sarah Jones, “Dear Rich People: Please Stop Hoarding Things,” New York, March 30, 2020, https://nymag.com/intelligencer/2020/03/things-are-bad-and-rich-people-arent-helping.html; Hanna Kozlowska, “Coronavirus is revealing ugly truths about social structure in the US,” Quartz, March 14, 2020, https://qz.com/1818548/coronavirus-is-revealing-ugly-truths-about-social-structure-in-the-us/; Eric Levitz, “In the Age of the Coronavirus, Biden’s ‘Results’ Require Bernie’s ‘Revolution,’” New York, March 16, 2020, https://nymag.com/intelligencer/2020/03/who-won-the-democratic-debate-between-biden-and-bernie-coronavirus.html; Joe Lowndes, “The Morbid Ideology Behind the Drive to Reopen America,” New Republic, April 30, 2020, https://newrepublic.com/article/157505/morbid-ideology-behind-drive-reopen-america; Tony Romm, “Uber drivers and other gig economy workers were promised unemployment benefits. It may be a long wait,” Washington Post, April 2, 2020, https://www.washingtonpost.com/business/2020/04/02/uber-airbnb-lyft-unemployment-coronavirus/; Jenny Schuetz, “America’s inequitable housing system is completely unprepared for coronavirus,” Brookings, March 12, 2020, https://www.brookings.edu/blog/the-avenue/2020/03/12/americas-inequitable-housing-system-is-completely-unprepared-for-coronavirus/; Luke Taylor, “When coronavirus is behind us, will you still think of restaurant and bar workers?” Vox, March 21, 2020, https://www.vox.com/2020/3/21/21188210/coronavirus-restaurant-bar-workers-economy-service-industry; Reis Thebault, Andrew Ba Tran, and Vanessa Williams, “The coronavirus is infecting and killing black Americans at an alarmingly high rate,” Washington Post, April 7, 2020, https://www.washingtonpost.com/nation/2020/04/07/coronavirus-is-infecting-killing-black-americans-an-alarmingly-high-rate-post-analysis-shows/; Funda Ustek-Spilda et al., “The untenable luxury of self-isolation,” New Internationalist, March 18, 2020, https://newint.org/features/2020/03/18/untenable-luxury-self-isolation; Jennifer Valentino-DeVries, Denise Lu, and Gabriel J.X. Dance, “Location Data Says It All: Staying at Home During Coronavirus Is a Luxury,” New York Times, April 3, 2020, https://www.nytimes.com/interactive/2020/04/03/us/coronavirus-stay-home-rich-poor.html
  13. [13]Joel Achenbach et al., “Coronavirus hot spots erupt across the country; experts warn of second wave in South,” Washington Post, May 20, 2020, https://www.washingtonpost.com/health/coronavirus-hot-spots-erupt-across-the-country-experts-warn-of-possible-outbreaks-in-south/2020/05/20/49bc6d10-9ab4-11ea-a282-386f56d579e6_story.html; Joel Achenbach, Rachel Weiner, and Isaac Stanley-Becker, “Study estimates 24 states still have uncontrolled coronavirus spread,” Washington Post, May 22, 2020, https://www.washingtonpost.com/health/study-estimates-24-states-still-have-uncontrolled-coronavirus-spread/2020/05/22/d3032470-9c43-11ea-ac72-3841fcc9b35f_story.html; Emma Farge with Peter Graff, “WHO warns of ‘second peak’ in areas where COVID-19 declining,” Reuters, May 25, 2020, https://www.reuters.com/article/us-health-coronavirus-who-peak/who-warns-of-second-peak-in-areas-where-covid-19-declining-idUSKBN2311VJ; Reis Thebault and Abigail Hauslohner, “A deadly ‘checkerboard’: Covid-19’s new surge across rural America,” Washington Post, May 24, 2020, https://www.washingtonpost.com/nation/2020/05/24/coronavirus-rural-america-outbreaks/
  14. [14]David Benfell, “When ‘good’ news might not be so good,” Not Housebroken, April 5, 2020, https://disunitedstates.org/2020/04/02/when-good-news-might-not-be-so-good/; David Benfell, “Don’t bet on ‘herd immunity,’” Not Housebroken, May 14, 2020, https://disunitedstates.org/2020/04/18/dont-bet-on-herd-immunity/; David Benfell, “The pandemic and a crisis of illegitimate authority,” Not Housebroken, May 14, 2020, https://disunitedstates.org/2020/05/12/the-pandemic-and-a-crisis-of-illegitimate-authority/
  15. [15]Mark Blyth, Austerity: The History of a Dangerous Idea (Oxford, UK: Oxford University, 2013); Amir Fleischmann, “The Myth of the Fiscal Conservative,” Jacobin, March 5, 2017, https://jacobinmag.com/2017/03/fiscal-conservative-social-services-austerity-save-money; Jason Hickel, “Progress and its discontents,” New Internationalist, August 7, 2019, https://newint.org/features/2019/07/01/long-read-progress-and-its-discontents; Daniel Stedman Jones, Masters of the Universe: Hayek, Friedman, and the Birth of Neoliberal Politics (Princeton, NJ: Princeton University, 2012); Robert Kuttner, “Austerity never works: Deficit hawks are amoral — and wrong,” Salon, May 5, 2013, http://www.salon.com/2013/05/05/austerity_never_works_deficit_hawks_are_amoral_and_wrong/; Dennis Loo, Globalization and the Demolition of Society (Glendale, CA: Larkmead, 2011); Thomas Piketty, Jeffrey Sachs, Heiner Flassbeck, Dani Rodrik and Simon Wren-Lewis, “Austerity Has Failed: An Open Letter From Thomas Piketty to Angela Merkel,” Nation, July 6, 2015, http://www.thenation.com/article/austerity-has-failed-an-open-letter-from-thomas-piketty-to-angela-merkel/; John Quiggin, “Austerity Has Been Tested, and It Failed,” Chronicle of Higher Education, May 20, 2013, http://chronicle.com/article/Austerity-Has-Been-Tested-and/139255/; David Stuckler and Sanjay Basu, “How Austerity Kills,” New York Times, May 12, 2013, http://www.nytimes.com/2013/05/13/opinion/how-austerity-kills.html; David Stuckler and Sanjay Basu, “Paul Krugman’s right: Austerity kills,” Salon, May 19, 2013, http://www.salon.com/2013/05/19/paul_krugmans_right_austerity_kills/

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