A Wake Up Call on Jobs

[Better Believe It]

A Wake Up Call on Jobs
by Robert Kuttner
November 16, 2009

President Obama has announced a White House Jobs Summit for next month. At least that's the beginning of recognition that the unemployment rate is unacceptable. The measured rate is now 10.2 percent, but if you count people who have given up or who are involuntarily working part time, the real rate is over 17 percent.

This spells political catastrophe for Democrats in the 2010 mid-term election, as foreshadowed by the recent losses in the New Jersey and Virginia governors' races. But Obama's top economic advisers, such as Larry Summers, don't seem to get it. They continue to resist the idea of a second stimulus package.

"I think we got the Recovery Act right," Summers recently told the Washington Post's Alec MacGillis, adding, "We always recognized that America's problems were not created in a week or a month or a year and that they were not going to be solved quickly. We designed the Recovery Act to ramp up over time, through 2010, and to make sure that the investments we made were important for the country's future."

And other senior Obama officials such as White House Chief of Staff Rahm Emanuel and Office of Management and Budget Chief Peter Orszag are more concerned with cutting the deficit than spending more money to reduce joblessness. According to the Wall Street Journal, Orszag is sympathetic to the idea of a commission to cap government spending and Emanuel is floating the idea of spending some of the money that has been repaid from TARP bank bailouts on deficit reduction.

But this is putting the cart before the horse. We need larger deficits now, in order to get a real recovery going, so that a healthy economy will allow us to pay down public debt later.

All told, we need additional federal spending in the range of at least $500 billion. But won't this increase the deficit? Yes it will, and that is the whole point. We are in a classic downward spiral of reduced household income and wealth, and a weakened financial sector. Many businesses face reduced consumer demand, compounded by a reluctance of banks to advance to any but the most blue chip borrowers.

In this climate, GDP growth can turn positive but companies are reluctant to hire. Full recovery will not resume spontaneously based on household or business demand, and the only source of increased demand to break the cycle is the government.

Read the full article at:

http://www.commondreams.org/view/2009/11/16-7

[phantom power]

1. The GOP will cheerfully beat the Dems over the head with this.

And if we don't have our narrative in place, preferably before they do, it may work.

[Cleita]

2. How are we going to have jobs when even now money being awarded in

contracts for renewable energy manufacturing like solar and windmills is being awarded to China and other countries to produce those items to sell back to us? There was an item on my local news last night about the opening of a new Bob's Big Boy (another fast food burger joint) in Morro Bay, California. Seven hundred applicants had showed up for one hundred and ten jobs. One lucky applicant who got a job told the interviewer that he had applied for fifty jobs before landing that one. The minimum wage he will get paid is not a living wage, so he's still going to be struggling. This country used to do so much better.

I'm really disgusted with our Washington elected officials that they can't seem to get this right.

[Berry Cool]

3. And I bet that applicant was hired only because he had previous experience

working at another Bob's Big Boy, preferably in the same part of California. Because, my God, the employers don't have to hire someone without previous Big Bob's experience. They could probably afford to sift through their 700 applications to weed out everyone who had never worked at a Big Boy before--possibly everybody who had never worked at a Big Boy in California--possibly everybody who had never worked at a Big Boy in that PART of California.

That's how selective it is now. If there weren't discrimination laws against it, employers could now sift through all their applications and resumes and choose not only the ideal candidate, but also the ideal candidate who also has brown hair, green eyes, and a little mole on the left cheek, who likes classical music (the Romantic period) and drives a Honda--if that's who they wanted to hire.

[harkadog]

4. Actually there aren't discrimination laws on those

If an employer wished to discriminate and hire people that you describe there are no employment discrimination laws that would make it illegal. They just cover sex, age, ethnicity, national origin and depending on what state you are in occasionally sexual orientation.

[branders seine]

5. the Obama Stimulus was too little, overwhelmed by the supply-side bank bailout,

and watered down with too much supply-side tax credit and tax-incented nonsense to be as effective as it needed to be.

I think we are in for a l-o-n-g spell of hideously painful unemployment. (Note: the real rate is more like 25% now than the 17% referred to above.)

This is a sea-change for our economy, which will never again be like it was.

[depakid]

6. Where Congress and the administration really botched it:

State and Local Fiscal Relief.

You often hear that outlays on public infrastructure are not a good source of stimulus because they take too long to plan. But emergency revenue sharing to states and localities takes effect almost instantly because it prevents cuts in existing programs and layoffs of existing workers. Today, states and localities are not only cutting back outlays because their constitutions require balanced budgets; they are raising taxes, usually regressive taxes. According to the Center on Budget and Policy Priorities, the three year state fiscal gap 2010-2012, will be at least $470 billion. So more than half of the federal stimulus is undermined by state and local belt tightening.

Think there will be losses on the federal level- wait until you see what happens to Democrats on the state level- and this in a reapportionment and redistricting year.

Heck of job.