The Reality Behind the Jobless Stats and Politics of Inaction
We're beginning to get a look at what happens when the subject of unemployment comes up at the White House. It ain't reassuring. Jared Bernstein, formerly chief economic adviser to Vice President Biden, who left the Administration last month says he "frequently" argued for forceful action to combat joblessness within the corridors of power. BC Question: What will it take to bring Obama home? However, "There will be no WPA-type programs in our near future. There was no appetite for them in the Obama admin in the midst of the worst recession since the Great Depression and there's a lot less now. The reasons for that are interesting and I'll speak to them another day. But it ain't happening."
In his blog post on May 29, Bernstein mildly and respectfully and took economist Paul Krugman to task for constantly writing about what the government "should" do as opposed to what it can. The reason Washington can't do more? It's not in the cards politically. The Republicans are in the ascendency, he says and, "Yes, it's true that leaders must stand up to such views and do what's right for the economy. Damn the torpedoes and all that. But those of us espousing such actions must respect, or at least acknowledge, that those torpedoes are not pointed at us." Under such circumstances "there's no point in even contemplating `coulds'."
Krugman had also proposed "a serious program of mortgage modification, reducing the debts of troubled homeowners." Forget about it said Bernstein who also had cautionary words for the editorial writers at the New York Times for arguing for such action. That ain't happening either, he said.
Obviously in response, Krugman wrote, "In pointing out that we could be doing much more about unemployment, I recognize, of course, the political obstacles to actually pursuing any of the policies that might work. In the United States, in particular, any effort to tackle unemployment will run into a stone wall of Republican opposition. Yet that's not a reason to stop talking about the issue. In fact, looking back at my own writings over the past year or so, it's clear that I too have sinned: political realism is all very well, but I have said far too little about what we really should be doing to deal with our most important problem.
"As I see it, policy makers are sinking into a condition of learned helplessness on the jobs issue: the more they fail to do anything about the problem, the more they convince themselves that there's nothing they could do. And those of us who know better should be doing all we can to break that vicious circle."
In a May 30 column, Krugman wrote that his mention of a WPA-type program was aimed "at the broader discourse, as well as the closed-door-off-the-record stuff I've been hearing from men in suits. Really bad analysis is posing as wisdom, and it needs to be called out."
Bernstein is right about the determination of the opposition to serious job creation action. Stan Anderson, chair of the Chamber of Commerce's Campaign for Free Enterprise, said in a letter to the Times. "Instead of making more government, such as creating Works Progress Administration-type programs, as Mr. Krugman suggests, we'd like to make government better so that creative free enterprise ideas can flourish in America again." That's about as ideologically callus as you can get.
"The president is going to be running for reelection in an economy that's still too weak," Bernstein acknowledged a few days later, after the May employment statistics were released. "It is improving and is in a far better place than it was when he got there but still is not adequately lifting the living standards of the broad middle class."
Of course, while you might not sense it the way the major media tells the story, the important victim in this situation is not the President's re-election prospect; it's the jobless. Their plight would be just as serious regardless of who was running.
'What do those who are jobless have in common?" asks economist Robert Reich. "They lack the political connections and organizations that would otherwise demand policies to spur job growth. There's no National Assn. of Unemployed People with a platoon of Washington lobbyists and a war chest of potential campaign contributions to get the attention of politicians." (Unlike the very well-to-do folks currently orchestrating the "deficit reduction" campaign.)
"As a result, too many are likely to remain unemployed for months if not years. That's bad news, not only for them but for America," says Reich.
"Republican lawmakers have responded to renewed signs of weakness with a jobs plan that prescribes more of the same `fixes' that Republicans always recommend no matter the problem: mainly high-end tax cuts, deregulation, more domestic oil drilling and federal spending cuts," wrote Reich. "The White House has offered sounder ideas, including job retraining, plans to boost educational achievement and tax increases to help cover needed spending. But its economic team is mainly focused on negotiations to raise the debt limit, presumably parrying Republican demands for deep spending cuts that could weaken the economy further while still reaching an agreement on the necessary increase.
"The grim numbers tell an unavoidable truth: The economy is not growing nearly fast enough to dent unemployment. Unfortunately, no one in Washington is pushing policies to promote stronger growth now.'
"The silence is deafening," writes Reich. "While the rest of the nation is heading back toward a double dip, Washington continues to obsess about future budget deficits. Why?"
"Republicans don't want to do anything about jobs and wages," says Reich. "They're so intent on unseating Obama they'd like the economy to remain in the dumps through Election Day. They also see the lousy economy as an opportunity to sell Americans their big lie that government spending is the culprit - and jobs will return if spending is cut and government shrinks.
Would the Republicans actually impede any effort to create jobs hoping the unemployment rate will remain high until the Presidential election? (Oh, you cynic) It's clear that at least some of them would. Consider the advice the party received last week from the rightwingers at Human Events. Erick Erickson, managing editor at redstate.com, a CNN contributor described credited by some with being one of the right's important political operatives, told the group's online readers he thinks Obama can be beat because joblessness will still be up there next year and the White House "has no real solutions to fix the economy."
"Reporters keep asking Republicans what they will do to create jobs,' says Erickson. "The answer should be obvious. `Nothing!' In fact, I think Americans are finally starting to embrace that answer. But when the unemployment rate is so high and inflation is on the rise and the take home pay of Americans brings home less and less, yes, I think the President is beatable."
It doesn't take much reading between the lines to decipher that message.
"The only tiny possible chink of light" in the May jobs stats "is that these numbers are so bad that they might persuade bickering politicians on Capitol Hill to stop playing stupid games with the debt ceiling and start concentrating on important matters," writes Felix Salmon, a financial journalist and Reuters blogger. "Oh, who am I kidding: we're in election season now. Nothing is going to happen, in terms of remotely important legislation, until 2013, for risk that Obama might be able to take credit for it."
As I said, our principle concern here must not be the 2012 Presidential election but the condition of the almost 12 milion people who want to work and can find no employment. Keep in mind that the 16.2 percent unemployment rate amongst African Americas is almost double the overall rate. The unemployment rate for black males went from 17 percent in April to 17.5 percent in May - the highest for any group.
The May unemployment rate for whites remained 8.0 percent while the Hispanic rate was 11.9 percent, up from 11.8 percent. The rate of underemployment (including the unemployed, marginally attached and those working part-time for economic reasons) was 15.9 percent up from 15.7 percent.
The ranks of long-term unemployed (jobless for 27 weeks or more) increased to 6.2 million, up from 5.8 million or 45.1 percent of all unemployed. These women and men represent 4.0 percent of the labor force. The highest percentage for any post-war period was 26.0 percent.
A delegation of Congressional Democrats met with the President last week and the jobless rate was discussed. However, according to informed sources, the question of the long-term jobless and the "99ers" who have exhausted their unemployment benefits, which had been raised an at earlier White House confab with the Congressional Black Caucus, never came up.
"I think right now with great intentionality we need to concentrate on black unemployment. If any group in America had a particular problem - let's say for example that suburban women were unemployed at a high level - we'd be involved in Washington and we'd bring the greatest economists that God has placed on the planet and we would struggle with ways to reduce that number," Congressional Black Caucus Chair Emanuel Cleaver told the House of Representatives the other day. "The figures confirm this is a persistent problem that will not go away if this is not addressed."
"Millions are still out of work and families are still struggling to make ends meet. After five months of controlling the House, the Republican Leadership continues to prevent critical jobs legislation from being considered and passed," said Cleaver.
Another subject nobody in Washington seems to be too concerned about is facing young people just entering the job market who are finding it impossible to secure their first job. Remember, they don't have unemployment benefits. People with college degrees are finding it increasingly hard to secure employment; many are settling for low paid positions that would otherwise have gone to less educated job seekers. This only compounds the calamity facing African Americans. Black teenage unemployment has risen from 30.4 percent to 40.7 percent over the past year.
The policy response to the crisis "was and remains vastly inadequate," wrote Krugman June 2. "Those who refuse to learn from history are condemned to repeat it; we did, and we are. What we're experiencing may not be a full replay of the Great Depression, but that's little consolation for the millions of American families suffering from a slump that just goes on and on."
BlackCommentator.com Editorial Board member Carl Bloice is a writer in San Francisco, a member of the National Coordinating Committee of the Committees of Correspondence for Democracy and Socialism and formerly worked for a healthcare union.