Sunday, April 22, 2012

"President Obama's Economic Programs Have Failed"

From the US News and World Report, not exactly a "right-wing rag".
America has long been a country where almost everyone, including the poor and unskilled, could get a job. Given the will to do a reasonable day's work, a job was a passport to economic and social well-being; it was the fount of self-esteem and the foundation of family life. Indeed, work was Life.

More than 15 million Americans no longer have that passport to Life. Think of it as roughly the entire population of the states of Connecticut, Delaware, Arkansas, Iowa, and Oklahoma, all standing idle—every man, woman, and child... [S]ome 25 percent of households include someone who is unemployed and looking for work. As well as laying waste to work, to the equivalent of losing every job created in the last decade, the Great Recession has visited us with reduced incomes, declining home equity, and a growing contraction in credit.

[...] America's great job creation machine is sputtering badly. It is now estimated that structural unemployment has risen from 5 percent before the crisis to close to 7 percent today. This means that one third of the rise in American joblessness may be impervious to the business cycle; it represents lost jobs that cannot be restored by boosting demand.

The problem now is not that people are being laid off by the millions. When an economy has reached bottom, as it did, it has already shed much of its labor, and layoffs slow. But the anemic recovery has not yielded job vacancies. Hiring today is at about 70 percent of the 2006 level. Given the increase in unemployed totals, job seekers are only about one third as likely to find work as in 2006.

Compare that to the fabled Great Depression of the 1930s. In the three years after 1933, the economy rebounded with growth rates of 11 percent, 9 percent, and 13 percent. But in 2010, months into our recovery, growth was about 3 percent, followed by 1.7 percent growth in 2011. The rate for 2012 could be about 2 percent—below the 3.4 percent throughout the postwar period.