Brace for a "Jobless Decade"
By any measure, the last decade was a rotten one. It started
with a stolen election and the worst terrorist attack in American
history. It is ending this week with the United States mired in two wars
and deep into a catastrophic recession.
It's hard to imagine that the next decade could be worse, but could it?
There are worrisome signs. An increasing number of economists are
saying that without major government intervention, the next ten years
could be a "jobless decade." "It will be the mother of all jobless
recoveries," predicts economic historian John Steel
The recession threw 8 million out of work and the losses are slowing,
but still piling up. A large percentage of those jobs have simply
disappeared, business have closed, work has been offshored.
While the stimulus package passed by Congress was big and slowed the
pace of job loss, the problem was even bigger. The Economic Policy Institute estimates that the
Obama stimulus bill has created or saved between 170,000 and 235,000
jobs per month starting in the second quarter of 2009. Yet, Princeton
economist Paul Krugman says
that the country would have to produce an additional 300,000 jobs per
month for five years to achieve full employment.
Unfortunately, the economy is weak and far from producing such
spectacular numbers. Economist David Levy, says
the country faces a new era of chronically high unemployment, averaging 8
percent or more over the next decade. He calls it the "New Abnormal."
The situation threatens both Democrats and Republicans. Republicans are
all too aware that the economy collapsed on their watch. Years of
deregulation and "hands off" enforcement of financial rules created a
climate of lawlessness on Wall Street. The Democrats of course are now
the party in charge. Polls show that Americans are running out of
patience with the lack of meaningful relief out of Washington D.C., and
they are starting to blame Obama, not Bush for the state of the
economy. The most recent Rasmussen poll
taken after the holidays shows that 56 percent of Americans now
disapprove of Obama's performance, reportedly the steepest first year
decline in modern history.
Franklin Delano Roosevelt, who took office three years into the Great
Depression, understood that there was no "recovery" without jobs and
that Democrats couldn't keep power unless they returned people to work.
He quickly started experimenting with new economic policies and programs
to address the crisis. While there were better known programs in
Roosevelt's "New Deal," historian Jason Scott Smith recently documented
that two-thirds of emergency spending between 1933 and 1939 actually
went to fuel job-creating public works programs.
Many Americans have not forgotten the lessons of this era and are
demanding that the administration focus like a laser on job creation,
since it will be many years before effects are felt. The newly formed Jobs for America Now coalition is
pushing Congress to adopt a five point plan that goes beyond tax
incentives to private industry and calls for direct job creation to help
communities meet pressing needs, especially in areas of severe
Without a deepening, serious and sustained effort to put people back to
work, the coming decade could be even worse than the last, a legacy no
Democrat or Republican can afford.
Mary Bottari is the Director of Center for Media and Democracy's soon-to-be
launched Real Economy
Project. She is an experienced policy wonk, public interest
advocate, and communications professional.