On Wednesday, President Obama articulated a rather forceful argument for the positive role government can play in meeting collective challenges. Lambasting the concept of the Ownership Society ("everyone is on their own"), Obama reminded us of some of the things that government is good at: maintaining a safety net, providing for retired workers, making sure most (!) people have access to health care. One of the hidden, and well-reasoned, implications is that capping oil wells just isn't one of them.
But Obama stopped there. While recognizing the "fragility" of the economy and the need to ensure a strong recovery, the President merely warned against "put[ting] on the brakes too quickly" as the country tries "to get our fiscal house in order." Even as he tied economic recovery -- and its resultant boost to federal revenues -- to an improving fiscal condition, he did not mount any sort of robust argument for the necessity of continued government action even as the economy recovers. His speech on the economy quickly became a speech about deficit reduction.
The administration's schizophrenic engagement with extending aid already being provided to state governments for education (and, separately, Medicaid) is revealing. Secretary Duncan raised eyebrows and hopes by sending a letter to Congress that requested inclusion of the education assistance in a supplemental appropriations bill. But the administration's support has never been made explicit.
Indeed, in his speech, the President carefully stated that "we have to work with state and local governments to make sure they have the resources to prevent the likely layoffs of hundreds of thousands of public school teachers across the country over the next few months." Though this may sound like an endorsement of more assistance, the phrase "work with" is a term of art: the administration supports more aid but, uncertain whether Congress can muster the support, is unwilling to stick its neck out and directly endorse it.
A defense of continued federal support for the economy is so necessary because the recovery which we are said to be experiencing is not only fragile but extremely limited. The private sector added only 41,000, total non-census employment appears to be flattening out, and, as Matt Yglesias points out, the public sector lost - lost! - 21,000 non-census jobs. This means that we are neglecting the easiest means to create jobs while pursuing half-baked schemes to stimulate employment through tax credits. Worse, abandoning education assistance would result in layoffs for hundreds of thousands of teachers, make a serious dent in public sector employment.
We know that unemployment lags in an economic recovery and we know the same is true for state revenue. But we also know that unemployment assistance has always been extended well beyond the technical end of a recession and that aid for states is a quick and easy way to save jobs.
Federal support for job creation is needed just as much halfway through 2010 as it was at the beginning of 2009. It is tepid reaction to this challenge of governance that the Obama administration should be criticized for, not some vague "failure of leadership" on the Deepwater Horizon oil spill.
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I say if the emphasis is on getting people working, then drop the minimum wage. You won't make a fortune on 7 bucks an hour, but it will feed you.
I believe that there is legitimate criticism about where the stimulus went, his lack of focus on job creation, his war on the private sector and the complete draining of political capital on multiple long-dated but not currently relevant initiatives from health reform, cap and trade, immigration reform, union card check, and so on and so on and so on. By depleting his political capital and consuming that all important first year, he now lacks the authority and time to enact critical targeted stimulus to bring people back to work. His troops are exhausted from the political wars, they see defeat in the fall, and he is a damaged leader.
All of this is too bad for our country.
Obama and the Democrats support of "free trade" with communist China and their support of H-1B should tell you exactly whose side they are on.
Of course the stimulus isn't going to work, it wasn't meant to. The goal of the stimulus was to buy time.
It's time to sober up. The federal support for jobs has reached its budgetary limits. The globalization and the illegal workers in this country that are a part of globalization have led to wages at the margin which are not living wages. If the workers of America are to reverse the "sucking sound" which has left them un employed, then there needs to be a serious re-think of nation-state and sovereignty. This means that wto is left aside. Job protection tarriffs are set. And America starts producing all that it consumes. Textiles, furniture, clothing, and even energy. The economy as we study it in classical economics is "national economy". Production has to do with stuff and not derivatives that produce paper gains for the rich at the relative deprivation of the working class subset of losers in the economy. It should once again be a matter of pride to be a working person. That will require a job with a living wage. And that will preclude Chinese workers providing goods at wage which is 5% of the American wage.
Why is it that this obvious reality cannot be discussed in America?
lots of parallels today with the roaring 20s - disparity of wealth, rampant speculation, real estate and other asset bubbles, cheap and easy credit, outsized influence of the financial sector, cronyism
just like those things led to the 1929 crash and the resulting depression, same as today where the crash of 08 created the great recsssion
Let's see.. because large corporations that outsource jobs and production (and who keep the MSM afloat) don't want it. Because those that control stocks - mega-investment funds, individual investors, 'financial services' corporations- tell companies they must increase profit at any cost. To the market, a "long-term" plan is 3 years out- 5 at most.
And because forcing 'superstores' and US-based brands to switch any significant production to this continent will bring a huge increase in the cost of goods- short-term for sure, possibly long-term. We can only guess (or go on faith) that such home-grown sourcing will raise the actual income of the working class fast enough to recoup the initial loss of buying power as prices climb. And let's face it; if corporations can manage to bring production here without 'sharing the wealth' we aren't really any better off for it.
I am still amazed (although also disgusted) at people who in one breath complain about the loss of "good jobs" in the US and in the next breath say how much they love Wally World et al.