(See below for image credit.)
The latest unemployment figures continue to show a bleak picture for job hunters as the unemployment rate climbed to 10.2% in October. Counting those who have settled for part-time jobs or have stopped looking, the rate is 17.5%. It’s the first time that America has reached double digits in 26 years, but many in the government continue to insist that the recession is over and the recovery is underway. Yet these same people remain perplexed as to why the “expanding economy” has yet to translate into jobs, shrugging it off as unemployment being a lagging factor in economic recoveries and taking heart in the slowing of the rate of decline. (Not that we’re gaining jobs, mind you, just that we’re losing them at a slower pace now.)
Part of the reason the expansion hasn’t resulted in more jobs is that the expansion, happily celebrated in the Commerce report last week and recounted by numerous pundits, was driven primarily by short-term government spending programs. The sectors that had robust growth in the third quarter, durable goods and residential investment, just happen to be the same areas that saw government payouts in the form of Cash for Clunkers and the first-time home buyer tax credit. No government spending program can be counted on as a lasting remedy for the nation’s woes, and now that these two have ended, it will be interesting to see how those sectors perform in the next quarter.
The elephant lurking in the room is the $787 billion economic stimulus package rushed through Congress in February that was billed as a jolt to our sagging economy and a surefire method of keeping unemployment under 8%. To be blunt, it has done little to nothing of value. Jobs that have been billed as “created or saved” have been either overblown or not in any danger in the first place. Indeed, 25% of California’s count for saved jobs weren’t in jeopardy at all, along with nearly 7,200 education jobs in Ohio. Hot Air has details on seven other states that overstated the number of jobs “created or saved” by the stimulus, and it all adds up to a less than inspiring picture.
Stimulus supporters will then protest that most of the money has yet to be spent. Really? That’s supposed to be an acceptable excuse for the lack of performance by one of the biggest spending bills in history? So if I understand that line of thinking, a bill promoted as a quick jolt to the economy – hell, they even called it a “stimulus” – can’t possibly be expected to have better results because the majority of the money, by design, isn’t going to be spent until next year. That’s not a stimulus, that’s unnecessarily prolonging our economic troubles only to have a convenient election-year influx of government cash to save the day.
It’s all put in stark visual contrast when you look at graphs at Innocent Bystanders (which I’ve reproduced at the top of this post) and the GOP’s website (which, as Ed Morrissey says, is just a stylized version of the former). I don’t know how you can better illustrate the absolute failure of the stimulus and government spending to result in economic growth.
Instead of engaging in a timeless government solution and throwing taxpayer money at a problem, America needs to address its manufacturing problems and figure out how to keep blue-collar workers in the job force. Or pass a trillion-dollar health package and a cap-and-trade energy tax. No big deal, whichever one you can get around to first.