Economy Watch: Yes, No, Maybe on Greek Exit

The Wall Street Journal reported that the European Commission and the European Central Bank are "drawing up plans" should Greece abandon the euro.

By Dees Stribling, Contributing Editor

The Wall Street Journal reported on Friday, citing Trade Commissioner Karel De Gucht, that the European Commission and the European Central Bank are “drawing up plans” should Greece abandon the euro. Apparently this is the first time that anyone of such high standing in the euro-zone has openly acknowledged that officialdom is making any kind of preparations for what’s now seen as likely, or even inevitable.

Of course, not all officialdom says it’s on board with such discussions. Almost immediately European Economics Commissioner Olli Rehn denied that the EU was getting ready to cast Greece out of the zone, saying, “We are not working on the scenario of a Greek exit.”

Meanwhile, the G8 Summit came and went mostly outside the glare of media coverage of street protests—there aren’t that many streets around Camp David—and the largest economies in the world didn’t offer any particular suggestions about extricating the euro-zone from its sticky wicket. There was an affirmation that the group wanted Greece to say in the currency zone, and some vague language that economic growth would, indeed, be a good thing for Europe, but not much more than that.

Most states see unemployment decrease

The Bureau of Labor Statistics Reported on Friday that during April, 37 states and the District of Columbia recorded unemployment rate decreases, five states posted rate increases and eight states had no change. The largest month-the-month increase in employment occurred in Indiana (up 17,100), followed by Texas (a gain of 13,200) and Georgia (7,800).

Michigan registered the largest jobless rate decrease from April 2011 (down 2.2 percentage points). According to the BLS, 23 additional states reported smaller but also statistically significant declines over the year. The remaining 26 states and the District of Columbia recorded unemployment rates that were not much different from those of a year earlier.

Nevada continued to record the highest unemployment rate among the states, a dubious honor it has long had: 11.7 percent in April, reports the BLS. Rhode Island and California posted the next highest rates, 11.2 and 10.9 percent, respectively. North Dakota again registered the lowest jobless rate at 3 percent, followed by Nebraska at 3.9 percent and South Dakota at 4.3 percent.

House votes against data collection

The U.S. House of Representatives voted 232 to 190 recently to abolish the American Community Survey (ACS), which was created in the 1990s with support from Republicans and Democrats to take the place of the decennial Census long form (last used in 2000) and which has been collecting data on American households since 2005. The government itself uses the data to help determine how more than $400 million in state and federal funds is spent each year, and businesses and other organizations find the data quite useful as well. The sponsor of the bill, a freshman from Florida, decried the ACS as costly and a violation of privacy rights.

The reaction to the vote, even from places generally sympathetic to the Republican House, was not particularly favorable. The Wall Street Journal, for one, noted that “businesses also depend on the ACS’s county-by-county statistics to inform investment and hiring decisions. As the great Peter Drucker had it, you can’t manage or change what you don’t measure… Republicans do themselves no favors by targeting a useful government purpose.” The Senate is not expected to act on the bill.

Wall Street had another down day, the latest in a string of them, with the Dow Jones Industrial Average down 73.11 points, or 0.59 percent. The S&P 500 lost 0.74 percent and the Nasdaq was off 1.24 percent in the wake of Facebook’s underwhelming initial performance (though few stocks could really live up to such hyperventilation).

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