THE PEOPLE WHO PAY THOSE TAXES AREN'T DOING SO WELL – AT 9:37 A.M. ET:  New economic reports are nothing for the White House to brag about.  Finally, those inflated gasoline prices are having their effect:

Real earnings fell for a fifth straight month as wages fail to keep up with soaring gasoline prices and other costs. Inflation-adjusted earnings for all private workers dropped 0.5% in March, the worst monthly drop since July 2008, according to Labor Department data. Nominal wages were flat while consumer prices climbed more than 0.5% for a second straight month.

Year over year, inflation-adjusted weekly pay sank 0.4%. That’s the first drop in a year and down from a 2.2% gain in October.

Since October, real weekly wages have dropped at a 3.8% annual rate — matching the decline set in July 2008, when oil prices peaked above $147 a barrel.

(Meanwhile, real hourly wages fell 0.6% vs. Feb. and 1% vs. a year earlier.)

The 2 percentage point temporary cut in payroll taxes has offset much of the recent decline in wages. But prices at the pump are taking their toll on consumers’ pocketbooks and psyche. Retail sales ex gasoline rose just 0.1% last month. The IBD/TIPP Economic Optimism Index dived to a 33-month low in April, losing more than 20% in the last three months.

Overall consumer inflation was 2.7% in March, the highest since the end of 2009. Core inflation was 1.2%, the highest since the start of 2010 but still moderate. However, overall and core inflation should continue to trend higher for the next few months, if only because of easy year-earlier comparisons.

Federal Reserve Chairman Ben Bernanke is betting that commodity prices will have only a temporary impact on U.S. inflation. We'll see.

It's not just inflation. Nominal weekly wages were flat in March. The yearly gain slowed from 3.4% in October to 2.3% in March.

COMMENT:  All right, what is the Republican program for dealing with this?  Obama has an abysmal economic record to run on.  He refuses to do a thing about high gasoline prices because that would upset the extreme environmentalists who are part of his base.  (He recently said in Brazil that we'd be happy to buy oil drilled there.  Oh great.) 

The old adage always applies, though.  You can't beat somebody with nobody.  People like Donald Trump are getting far too much publicity because there's a leadership vacuum at the Republican presidential level.  That vacuum will have to be filled in the coming months for Republicans to have enough time to make their case and come up with the best candidate for president.  My fear continues that the GOP will just nominate the next guy in line and leave it at that, allowing Obama to slip through to a second term. 

It's already April.  Primaries start in about eight or nine months.  Time to get going.

April 15, 2011