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Robert Reich
NationofChange / Op-Ed
Published: Friday 7 December 2012
The cost of borrowing is so low — the yield on the ten-year Treasury is near historic lows — and the need for more jobs and better wages so high, and our infrastructure so neglected, that it’s insanity not to borrow more to put more Americans to work rebuilding the nation.

Today’s Job Numbers Show Why Job-Creation Must Take Precedence Over Deficit Reduction

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Today’s jobs report shows an economy that’s still moving in the right direction but way too slowly, which is why Washington’s continuing obsession with the federal budget deficit is insane. Jobs and growth must come first.

The cost of borrowing is so low — the yield on the ten-year Treasury is near historic lows — and the need for more jobs and better wages so high, and our infrastructure so neglected, that it’s insanity not to borrow more to put more Americans to work rebuilding the nation.

 Yes, unemployment is down slightly and 146,000 new jobs were created in November. That’s some progress. But don’t be blinded by the hype coming out of Wall Street and the White House, both of which want the public to believe everything is going wonderfully well.

The fact is some 350,000 more people stopped looking for jobs in November, and the percent of the working-age population in jobs continues to drop — now at 63.6%, almost the lowest in 30 years. Meanwhile, the average workweek is stuck at 34.4 hours.

The slowness of this recovery isn’t because of Hurricane Sandy, which it turns out had very little impact on these job numbers. And it’s not because of any uncertainty over the looming “fiscal cliff.” Most consumers in November were oblivious about any pending cliff.

The reason the economy is still under-performing is demand is inadequate. Businesses won’t create more jobs without enough customers. But consumers can’t and won’t spend because they don’t have the money. Unless or until the private sector — businesses and consumers — are able to boost the economy, government must be the spender of last resort.

But the nation has bought into the Republican frame of thinking that we have to “get our fiscal house in order” before the economy can get back on track. Even though Barack Obama was reelected and Democrats gained seats in the House and Senate, that frame is still dominating debate.

Even though we’re near a fiscal cliff that illustrates how dangerous deficit reduction can be when so many people are still unemployed, the White House and the Democrats seem incapable of changing the frame of debate.

Jobs must come first. Job creation must be our first priority.

This article was originally posted on Robert Reich's blog.



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ABOUT Robert Reich

 

ROBERT B. REICH, one of the nation’s leading experts on work and the economy, is Chancellor’s Professor of Public Policy at the Goldman School of Public Policy at the University of California at Berkeley. He has served in three national administrations, most recently as secretary of labor under President Bill Clinton. Time Magazine has named him one of the ten most effective cabinet secretaries of the last century. He has written thirteen books, including his latest best-seller, “Aftershock: The Next Economy and America’s Future;” “The Work of Nations,” which has been translated into 22 languages; and his newest, an e-book, “Beyond Outrage.” His syndicated columns, television appearances, and public radio commentaries reach millions of people each week. He is also a founding editor of the American Prospect magazine, and Chairman of the citizen’s group Common Cause. His widely-read blog can be found at www.robertreich.org. Robert Reich's new film, "Inequality for All" is available on DVD
and blu-ray, and on Netflix in February.

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5 comments on "Today’s Job Numbers Show Why Job-Creation Must Take Precedence Over Deficit Reduction"

Brian Glennie

December 10, 2012 8:50am

It is only the Middle Class that is suffering .
The upper Class and their corporations are on the ' dole'
That is the way their God wants it, so they tell me

DHFabian

December 07, 2012 2:59pm

We have NO chance of restoring the economy because today's economic discussion censors out the millions of Americans not as well off as the middle class (the media's 24/7 pandering to the middle class serves only to increase class tensions). It defies logic to fret about declining wages while increasing a secondary workforce, workfare, to serve as super-cheap replacement labor. With so great a percentage of the population now post-middle class/poor, economic discussions that completely exclude the impact of unrelieved poverty have no connection with reality. Because of this, it isn't possible to address the overall economy.

dwdallam

December 07, 2012 2:57pm

The economy will eventually need to shrink because of the law of physics. Already we see the writing on the wall: We don't need all of the people who need work!

With advancements in robotics and computers, that is only going to get worse and worse, yet we are still full speed ahead adding to population levels -- as if that's a good thing. This is simply mass irrationality.

Unconditional1

December 07, 2012 8:21pm

As usual...you hit a nail on the head.

greggerritt

December 07, 2012 1:07pm

The economy is going to shrink due to ecological collapse. Our real challenge is to create full employment in a shrinking economy. Close the Pentagon and all its bases, shut down the fossil fuel industry, and turn every vacant urban lot into a farm. Local agriculture is the only way to have a full employment economy and heal the ecosystems we rely upon to feed us.