Katrina vanden Heuvel: Time for a New Round of Stimulus

[marmar]

from The Nation:



Time for a New Round of Stimulus
posted by Katrina vanden Heuvel on 06/05/2009 @ 4:37pm


"We might be witnessing the mother of all jobless recoveries."

That's how economist Bernard Baumohl described today's jobs report to the New York Times.

While there were "only" 345,000 jobs lost last month--as compared to 504,000 in April--the report doesn't account for the upcoming job losses as well as the ripple effect that will result from the GM bankruptcy. Nor does it reflect the severe budget shortfalls states continue to face. It did, however, reveal a continued collapse of wage growth, the highest unemployment rate in 25 years, and the loss of 156,000 manufacturing jobs.

Economic Policy Institute economist Heidi Shierholz writes today, "It is only in the midst of a historically steep recession that losing 345,000 jobs in a single month is actually taken as a good sign.... The US labor market is still hemorrhaging jobs. With the continued loss of jobs and hours along with the collapse of wage growth, it is time to start thinking very seriously about additional stimulus spending."

In fact, the Center for Economic and Policy Research (CEPR) is maintaining an "honor roll" of economists who have called for another stimulus "in an effort to promote forward thinking...and challenge those who have not yet faced up to the severity of the current recession." ........(more)

The complete piece is at: http://www.thenation.com/blogs/edcut/441525/time_for_a_new_round_of_stimulus

[Davis_X_Machina]

1. Will never happen. You can't even get people here...

...to buy in, and we're generally far to the left of the spectrum. This is a Keynes-friendly forum, and I doubt a second round of stimulus would command a majority.

As for Congress forget about it.

We've gotten all the stimulus we're going to get, federal and state, and as a practical matter, the oil-price rollback that was the biggest stimulus of all is over.

Basically, we're doomed. I don't expect to ever see a U6 of less than 15% again in my lifetime, and I'm 52.

The 'governments should be run like families, paying all their bills every month' trope is too deeply entrenched to be overcome. Some ideas are more durable than even the collapse of the structures that generate them, and that they explain.

People faced with a stark choice of their preconceptions, or reality, will choose their preconceptions every time.