Okay, health care is done, now a quick deep breath and on to a bigger crisis: how to get millions of Americans back to work.
The gross numbers alone are daunting:
- Nearly 15 million people flat out unemployed.
- Almost 9 million working part-time because they can’t find full-time work
Millions more marginally attached workers or so-called discouraged and not counted as unemployed.
The bottom line is that America needs more than 10 million jobs just to get back to where we were two years ago. That would be difficult enough if we had at least begun adding jobs. But the U.S. economy continues to lose jobs.
The problem is so deep that even those with jobs are affected. That’s because that vast army of the unemployed is depressing incomes for those who do have jobs, according the Bureau of Labor Statistics, which pegs the decline in income at 1 percent for year ending February.
If the unemployment is rightfully deemed a crisis, the future offers little prospect of relief.
This past week the Obama administration’s economic team, led by Treasury Secretary Timothy Geithner, told Congress it expects the economy to generate about 100,000 per month for the remainder of this year. That’s better than losing jobs but 100,000 jobs monthly is barely what’s needed to keep pace with new workers entering the job market.
In other words, 100,000 jobs monthly would hold lock things at the status quo.
Further ahead, Geithner and company predict the unemployment rate – now 9.7 percent nationally and 12.5 percent in California – will edge down to 8.9 percent by the close of 2011. I don’t think I’ll hold either my breath or the Champagne for that prospect.
What should make this all the more scary is that none of the plans being offered for dealing with unemployment even pretend to deal with the scope of the problem.
That jobs bill Obama signed giving small companies tax breaks for hiring the unemployed this past week?
It might result in about 200,000 hires, according to the W.E. Upjohn Institute. Don’t race for your calculator, I’ve done the math: If the HIRE Act works as advertised, it would generate about 2 percent of jobs we need.
To be sure, neither the Obama nor Congress characterized the jobs bill as anything but a small step. That that would be encouraging, if there were additional measures in the offing that make sense.
There aren’t.
Apply a sharp pencil to the host of job proposals on the table and it’s obvious that none has the breadth, depth or wherewithal to get millions of people back to work.
More credit for small businesses?
Help me out here: Why would small business expand when American incomes are falling and even the employed fear for their future?
The small business people I know are seeing sales fall and have no interest in expanding at this time. The demand for credit, in fact, has fallen in the recession.
Rather than a credit crunch, we have a debt crisis at nearly every level - personal, state, federal and financial. (Oh, that’s right; we took care of the debt problem on Wall Street. What a load off my mind.)
Think American innovation will bail us out?
Well, while the U.S. was inventing synthetic collateralized debt obligations (don’t ask, but as Counterpunch readers now we all own them since taxpayers bailed out AIG), China was blowing past us in the manufacture of wind turbines and photovoltaic panels.
Oh, our engineers can beat their engineers?
Maybe, but will our engineers work for $9,000 annually – that’s going rate for these technical workers in China. With a master’s degree, no less.
Think training will get America? We’ve all heard that one and it’s true that employment in certain technical niches has increased (though not for electrical engineers and computer programmers). But there’s no way these technical occupations can absorb the millions who need work.
And keep this in mind: This past week the top scientist at Advanced Materials, a Silicon Valley company which is the world’s largest supplier of equipment to make semiconductors and photovoltaic, said he was moving to China. According to the New York Times, “companies are concluding their researchers need to be close to factories and consumers.”
Factories – remember those? What we forgot as we watched a third of America’s manufacturing move abroad is that this sector employs more scientists and technical workers than any other.
There’s ample evidence that things would have been much worse without the stimulus package passed last year. Most estimates are that we’d have roughly two million fewer jobs now without that program.
But for those looking for a plausible plan to get back to a reasonable level of employment, there’s little on the table now but despair.
Of course, many with a deep-seated faith in the ability of the US economy to renew itself, to come up with the latest widget, and to generate jobs may believe the absence of serious programs for unemployment is a good thing. Government tinkering will only cause harm, they say. Let the free market reign.
Well, if you believe that one, AIG has got a deal for you: billions of dollars in synthetic collateralized debt obligations. And there are thousands of financial wizards who can tell you how they work.
What they can’t explain is how to get America back to work.
http://www.counterpunch.org/rose03222010.html
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