by Randolph T. Holhut
American Reporter Correspondent
January 18, 2014
THE JOBLESS RECOVERY: SIX YEARS AND COUNTING
DUMMERSTON, Vt. -- The Great Recession began in December 2007 and ended in June 2009.
At least that's what the government's official economic data-keepers say is the case.
However, for many Americans, the recession has never ended.
Sure, the stock market indices are all up past their pre-recession levels. as are corporate profits. But less than half of U.S. households own stock, and of that number, many don't own stock in significant amounts.
The indices that matter to working Americans - the unemployment rate and overall wage growth - tell a different story.
According to a new report from the Economic Policy Institute, there is a jobs gap in the United States. The number of jobs that need to be created to restore employment levels to what they were before December 2007 is 7.9 million. That figure factors in the more than 90,000 jobs that need to be created each month for people who are only now entering their working years.
Yet, there are still three job seekers for few job openings there are, and the U.S. economy continues to add jobs at an anemic rate. The average in 2011 was 175,000 jobs per month added to the labor market. In 2012, it was 183,000 jobs, and about 191,000 in 2013. At the current pace, it would take another five years to regain pre-recession levels.
The public services sector has also taken a beating, with 728,000 jobs lost since the "official" end of the recession in June 2009.
More troubling is that the decline in the unemployment rate - from its peak of 10 percent in the fall of 2009 to 7 percent right now - is mostly due to people either dropping out of the labor force - or never entering it to begin with because of the lack of opportunities. According to the official stats, people are only counted as unemployed if they are actively looking for work.
The standard economic orthodoxy says when you have weak aggregate demand for goods and services, you get high unemployment. And the remedy for that problem is boosting aggregate demand, which usually gets done by the one entity that has spending power in a recession - government.
Investing in large-scale public investments, reinstating public services and jobs that were cut over the last six years, and increasing social welfare spending are all things that will boost economic activity.
And they are all things that are opposed by the Republican Party and insufficiently defended by the Democratic Party.
We know the Republican Party is engaged in economic sabotage. How else to explain 440 filibusters in the Senate since President Obama took office and the steadfast refusal by the Republican-controlled House to allow votes on economic stimulus, an extension of long-term unemployment benefits, or an increase in food stamp benefits?
Since this is an election year, the Republicans plan to campaign on their obstruction. Only they will call it something else.
They will call it the failed Obama economy.
The Democrats should be beating Republicans over the head with their obstruction and borderline treason. They should be calling out the GOP's cynical attempt to choke the life out of the U.S. economy and then blame the Democrats for the lack of a recovery.
But few Democrats are willing to do this, mainly because they are afraid of alienating the big money donors that help get many of them elected.
They shouldn't be so afraid.
The financial sector big-wigs that got Barack Obama elected President in 2008 abandoned the Democrats in 2010 and 2012, and will likely do the same this November. Why? Because they are among the 1 percenters who benefit from having millions of American workers who are hungry, broke, desperate and willing to take any job - no matter how crappy it is, or how little it pays.
We know what can help make our economy stronger. We also know who benefits from a stagnant economy. Can we use this knowledge to get our elected officials to do the right thing, or will we allow millions of unemployed Americans to needlessly suffer for political gain?.
AR's Chief of Correspondents, Randolph T. Holhut, holds an M.P.A. from the Kennedy School of Government at Harvard University and is an award-winning journalist in New England for more than 30 years. He edited "The George Seldes Reader" (Barricade Books). He can be reached at firstname.lastname@example.org.