Posted on 10/03/2009 8:51:18 AM PDT by SeekAndFind
Unemployment will almost certainly in double-digits next year and may remain there for some time. And for every person who shows up as unemployed in the Bureau of Labor Statistics household survey, you can bet theres another either too discouraged to look for work or working part time whod rather have a full-time job or else taking home less pay than before (Im in the last category, now that the University of California has instituted pay cuts). And theres yet another person whos more fearful that he or she will be next to lose a job.
In other words, ten percent unemployment really means twenty percent underemployment or anxious employment. All of which translates directly into late payments on mortgages, credit cards, auto and student loans, and loss of health insurance. It also means sleeplessness for tens of millions of Americans. And, of course, fewer purchases (more on this in a moment).
Unemployment of this magnitude and duration also translates into ugly politics, because fear and anxiety are fertile grounds for demagogues weilding the politics of resentment against immigrants, blacks, the poor, government leaders, business leaders, Jews, and other easy targets. Its already started. Next year is a mid-term election. Be prepared for worse.
So why is unemployment and underemployment so high, and why is it likely to remain high for some time? Because, as noted, people who are worried about their jobs or have no jobs, and who are also trying to get out from under a pile of debt, are not going do a lot of shopping. And businesses that dont have customers arent going do a lot of new investing. And foreign nations also suffering high unemployment arent going to buy a lot of our goods and services.
And without customers, companies wont hire. Theyll cut payrolls instead.
Which brings us to the obvious question: Whos going to buy the stuff we make or the services we provide, and therefore bring jobs back? Theres only one buyer left: The government.
Let me say this as clearly and forcefully as I can: The federal government should be spending even more than it already is on roads and bridges and schools and parks and everything else we need. It should make up for cutbacks at the state level, and then some. This is the only way to put Americans back to work. We did it during the Depression. It was called the WPA.
Yes, I know. Our government is already deep in debt. But let me tell you something: When one out of six Americans is unemployed or underemployed, this is no time to worry about the debt.
When I was a small boy my father told me that I and my kids and my grand-kids would be paying down the debt created by Franklin D. Roosevelt during the Depression and World War II. I didnt even know what a debt was, but it kept me up at night.
My father was right about a lot of things, but he was wrong about this. America paid down FDRs debt in the 1950s, when Americans went back to work, when the economy was growing again, and when our incomes grew, too. We paid taxes, and in a few years that FDR debt had shrunk to almost nothing.
You see? The most important thing right now is getting the jobs back, and getting the economy growing again.
People who now obsess about government debt have it backwards. The problem isnt the debt. The problem is just the opposite. Its that at a time like this, when consumers and businesses and exports cant do it, government has to spend more to get Americans back to work and recharge the economy. Then after people are working and the economy is growing we can pay down that debt.
But if government doesnt spend more right now and get Americans back to work, we could be out of work for years. And the debt will be with us even longer. And politics could get much uglier.
The WPA and the CC did nothing to generate wealth or create new jobs. They might as well handed out money for doing nothing as to have made those make work projects. The real solution is to cut taxes, eliminate corporate income taxes and capital gain taxes, abolish the EPA and keep just a few common sense enviro laws. Spending more money is what kept the depression going until WWII started and after. Real recovery didn’t start until 1946. FDR was after the same thing Bozo is after now, collapsing the economy and shifting it to government control, fortunately for the US, WWII came along and then the communist SOB died.
That this fraud can call himself an economist amazes me.
Robert Reich endorsed Obama.
Right now, its the only option. Average Americans have little earnings to stimulate demand. And less credit, apparently.
parsy, who is not optimistic at all
This guy is living in a dream world of somesort. He's telling us that only heavy construction jobs outdoors can bring us out of the current unemployment situation.
I get the distinct article this guy has no idea how roads are built, bridge repaired, major earthmoving projects are handled.
Nope, we don't use a bunch of guys with shovels earning 50 cents a day digging holes!
Wrong - Bzzzzt
Check the US WWII post war bombing survey. Germany still had 80% of their industrial/war making capacity.
Britain had increased their industrial output, and the National Socialist occupied territories: hardly touched.
80%?? Where did you get that stat?
Need jobs? Create an incentive to hire people.
1. Renew the Bush tax cuts to encourage businesses to expand include the tax reform package an elimination of the capital gains tax. “Pay for it” by a 2 year freeze on Government spending and a re-imposition on the 1995 “Pay as you go” Congressional budget rules with none of the current loopholes
2. Offer a $1500 per new employee tax credit to business to cover the hiring and training costs.
3. Kill cap and trade, health care reform and all the other boodgoggle anti capitalism bills currently being considered in the Congress. Have 0 vow to veto any legislation that will cost real current US jobs with vague promises about imaginary Green job in the future.
4. Pass the Developing Americas Resources act to remove all bottlenecks and obstacles in Government regulation that is blocking development all US energy resources and commit the US Government to exploiting any and all US energy sources to end our dependency on imported energy.
What all this current govt intervention in the Economy is doing is causing business, and capital, to hunker down in a bunker mentality wondering what new Govt boondoggle they are going to be told to pay for.
The problem is lack of jobs, the solution is to incentives the 10s of thousands of businesses around the country to hire a few people and create new jobs by eliminating Govt regulations that prevent us from doing things to develop our own energy resources.
These are long term solution that also provides immediate short term gains.
He IS high on Obama’s policies. He’s saying the only thing that can provide jobs is the government.
Democrat must be the Greek word for delusional. They all point to FDR as the role model for economic recovery, and they might be right if you are willing to wait ten years and fight a world war to get there.
Factually incorrect. The US is still the world's largest manufacturer as well as, by far, the worlds largest market and economy.
FDR, Jimmy Carter, Richard Nixon and now 0 have followed this National Socialist Keynesian model and produced stagnant economies and record unemployment.
The facts are there. That people like Reich do not see them is because they are so welded to the political views their father taught them they cannot be bothered with simple, basic facts.
mmmm mmmmmm mmmm
I think there's a song in there somewhere.
And all I’ll say is you are far more favorable towards Roosevelt than I am.
Really? I think he was a communist a**hat that should have been kicked out of office after his first term:)
Yeppir, and I don't think THAT much of him.
I disagree with Reich on... well, most everything, but he’s always struck me as a decent human, and he ranks high on my list of folks I’d like to have a beer with.
His reasoning here is bass-ackwards, but the offer of a nice foamy ale stands.
Is this another Eloy liberal calling for Morlocks to work harder or what?
Robert Reich? Wow, I thought this man was high on Obamas policies. This is big IMO.
I don't think you read the whole piece. He attacks Obama from the left.
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