Archive for November 10th, 2009|Daily archive page

Create Jobs, Jobs, Jobs

Great article from Alec MacGillis in the Washington Post’s Outlook Section.

Yet the national unemployment rate has now hit 10.2 percent, helping explain why Republicans won the governors’ races in Virginia and New Jersey last week, just a year after the party’s 2008 drubbing. And Obama declared Friday that more action is needed.

“History tells us that job growth always lags behind economic growth, which is why we have to continue to pursue measures that will create new jobs,” he said. “And I can promise you that I won’t let up until the Americans who want to find work can find work.”

It was a strong vow, but it raises a question: Why has a White House that talks so much about boosting employment steered clear of the most direct strategy that could keep Americans on the job?

Direct hiring is only one part of a larger issue of pursuing a full employment goal. As the Obama Administration Economic team tells everybody within ear shoot every five minutes, they inherited a really bad situation and they designed a policy which mitigated the damage. Obama’s economic team is right that they inherited a bad a situation, but nobody cares and they’ll need to do better then this explanation of their policy by Larry Summers:

“I think we got the Recovery Act right,” Larry Summers, the president’s chief economic adviser, said in an interview. “The primary objective of our policy is having more work done, more product produced and more people earning more income. It may be desirable to have a given amount of work shared among more people. But that’s not as desirable as expanding the total amount of work.”

Larry Summers really, really needs to think about that particular line. Since when was creating jobs a secondary goal and since when did the President’s economic advisers actually proceed to admit that job creation wasn’t a primary goal?

It’s likely a post hoc rationalization of the outcome of their stimulus policy, which to date has created great gains in productivity, but basically no positive job creation. We need a self consciously full employment policy and the stimulus bill wasn’t that policy. Pursuing a full employment policy is the ethical, economically and politically right thing to do.