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Top Gun Fires Blanks On The Economy |
Current rating: 0 |
by Mark Weisbrot
(No verified email address) |
04 Nov 2003
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Mr. Bush is well on his way to being the first president since Herbert Hoover, more than 70 years ago, to preside over a net loss of jobs. |
The U.S. economy has lost 2.8 million jobs since February of 2001. Unemployment stands at 6.1 percent of the labor force, not including the millions who are working part-time because they cannot find full-time jobs, or those who have given up looking for work.
Despite fast-growing productivity, real wages have barely grown over the last year. Soaring health care costs -- including an increasing share shifted to employees -- have taken a big bite out of most people's income. Millions of older workers are now slogging past their planned retirement to make up for the savings they lost in the stock market crash and corporate crime wave.
But President Bush has made a political career out of setting the bar low enough -- remember the Presidential debates of 2000? -- that anything less than Great-Depression-style failure could possibly be spun by the Bush team as success.
And they are trying, with Treasury Secretary John Snow boasting that the economy would create 200,000 jobs a month over the next year.
But the economy needs to create more than 150,000 jobs each month just to employ new entrants to the labor force and keep the unemployment rate from rising. Even if Snow's prediction were to come true, the 200,000 jobs per month would still not make up for the 2.8 million jobs lost since President Bush took office.
Mr. Bush is well on his way to being the first president since Herbert Hoover, more than 70 years ago, to preside over a net loss of jobs.
Some have argued that the economy is recovering fast enough, but that productivity -- the amount of output produced per hour of labor -- is growing too much. According to this argument, since businesses can produce more and more with fewer labor hours, they're not hiring more employees.
But this is not true. Productivity always grows more rapidly after a recession, and this recovery is not much different from the last five -- going back to the 1960s -- in terms of productivity growth. The problem is simply that the economy has not grown fast enough -- as it did in previous recoveries -- to create new jobs.
To be fair, the Bush team is not responsible for the recession that officially began in March of 2001. That was caused by the collapse of the stock market bubble, an entirely foreseeable event that all of our political leaders -- and the press -- should have warned us about. But the Bush team can be blamed for not doing anything to counteract the downturn.
For example, they could have provided federal funds to the state governments, which are reducing employment and economic growth as they try to close an $80 billion shortfall. But instead they chose to rewrite the tax code in favor of their very richest contributors, creating chronic fiscal deficits far into the future -- while providing relatively little economic stimulus at present. And they embarked on a costly war, based on false pretenses, with no end in sight.
The economy generally looms large in any Presidential election. Al Gore would most likely be president today if he had chosen to campaign on the economy, as most political observers expected he would. After all, his administration had presided over the longest economic expansion in American history. But for reasons that remain unexplained, he chose not to make a major issue out of it.
The Democratic candidate this time is unlikely to make the same mistake. He might take a page from Ronald Reagan, who in 1980 famously asked voters, "Are you better off than you were four years ago?" For most Americans, even those fortunate enough to be employed, the answer next year will probably be no.
Mark Weisbrot is co-Director of the Center for Economic and Policy Research, in Washington, DC (www.cepr.net).
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Re: Top Gun Fires Blanks On The Economy |
by Jack Ryan
(No verified email address) |
Current rating: -2
04 Nov 2003
Modified: 04:00:32 PM |
Dear Mark,
7.1 % growth in the 3rd quarter. Read it and weep, my liberal friends. The Clinton Recession is over.
Jack |
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US Job Cuts More Than Doubled In October- Report |
by Dan Wilchins
(No verified email address) |
Current rating: 0
05 Nov 2003
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NEW YORK - The number of job cuts announced by U.S. employers more than doubled in October to the highest level in a year, a report said on Tuesday, raising worries that persistent layoffs would undercut the economy's robust recovery.
Planned layoffs at U.S. firms shot up to 171,874 jobs in October, from 76,506 in September, job placement firm Challenger, Gray & Christmas said in their monthly job cut report. That was the highest amount since 176,010 job cuts were announced in October 2002.
Challenger also said that according to a poll it conducted, 78 percent of human resources executives did not expect any significant upturn in hiring until the second quarter of 2004.
"We're not out of the woods yet with regard to the labor market," said Lehman Brothers economist Drew Matus.
The Challenger report raised caution that Friday's employment report could show job losses in October, throwing into question whether the economic rebound will be sustained next year.
Economists polled by Reuters expect a 55,000 rise in payrolls after a 57,000 gain the prior month, though that is below the 150,000 or more rise in payrolls that analysts believe is needed to bring down the unemployment rate, now at 6.1 percent.
In a sign the job market may face another difficult month in November, Tyco International Ltd. on Tuesday said it would eliminate 7,200 jobs as it streamlines its far-flung empire.
Even as the economy grew a whopping 7.2 percent in the third quarter, its fastest pace in two decades, firms eliminated 41,000 positions -- showing that even robust growth has not led to hiring.
Some economists cautioned that job losses in October are usually higher due to seasonal factors. Other data, like weekly claims for jobless benefits, have suggested the labor market is starting to stabilize after hemorrhaging nearly 3 million jobs in the past three years.
Manufacturers nationwide slowed their pace of layoffs in October, and some regional surveys have showed renewed hiring for the first time in the past few years.
Additional reporting by Kevin Plumberg
Copyright © 2003 Reuters Ltd
http://www.Reuters.com |
