The 'Rabbit Starvation' of America?

Some 243,000 nonfarm jobs were added to the U.S. economy in January 2012, dropping the U.S. unemployment rate to 8.3%, according to the U.S. Bureau of Labor Statistics. This is welcome news, nevertheless, news that must be met with some skepticism (or at the least, viewed in a grander scheme).

What is most troubling about U.S. labor statistics is that they are subject to extensive "adjustments" that may obfuscate the true picture of the American economy. Yes, the unemployment rate has declined. But so has the percentage of Americans participating in the workforce (now at 30-year lows!).

And even if you take BLS data as fact (some market observers, such as TrimTabs’ Charles Biderman do not), the question remains: If more Americans are working, why is the government assisting them more than ever?

Contrasting the millions of Americans receiving Supplemental Nutrition Assistance (more commonly known as food stamps) with the decline in the unemployment rate is troubling. To this author, it paints a picture of rabbit starvation -- hunting more and more rabbits (working in a low-paying job with no opportunity) will not save the hunter from starvation.

I hope this is not so.

The chart below contains only a three-year snapshot of data (not enough to pass definitive judgement and not reflecting the last two months of job gains). But as we often hear the "good news" of adjusted economic statistics, a passage from George Orwell's Animal Farm rings in my ears:

"There were times when it seemed to the animals that they worked longer hours and fed no better than they had done in Jones's day. On Sunday mornings Squealer, holding down a long strip of paper with his trotter, would read out to them lists of figures proving that the production of every class of foodstuff had increased by two hundred per cent, as the case might be. The animals saw no reason to disbelieve him, especially as they could no longer remember very clearly what conditions had been like before the Rebellion. All the same, there days when they felt that they would sooner have had less figures and more food."