Skip to Content

Share

Robert Reich: Back Toward Double Dip

June 6, 2011

Bookmark and Share


Will the stalling economy finally wake Washington up from the games being played over the debt ceiling?

By **Robert Reich**

By arrangement with RobertReich.Org.

Robert Reich.JPGThe May jobs report is a disaster—the weakest reading since September. Non-farm payrolls grew only 54,000 last month, according to the Labor Department’s Bureau of Labor Statistics. Private employment rose only 83,000—the smallest growth since last June. Government payrolls dropped 29,000.

The overall jobless rate rose to 9.1 percent.

Together with plummeting housing prices, falling wages for non-supervisory workers, a paltry 1.8 percent growth in the first quarter, and a precipitous drop in consumer confidence, the picture should be clear to anyone able to see clearly.

The recovery has stalled.

We’re not in a double dip yet, but the odds are increasing.

Washington needs to show Americans it’s taking seriously the ferocious problem of jobs and wages, and the trend back toward a double dip.

The question is whether all this will wake up Washington, and stop the monumental distraction of the games being played over the debt ceiling and long-term budget deficit. The Republican lie that the nation’s long-term budget deficit is responsible for high unemployment would be laughable if it weren’t so tragically irrelevant to the current situation.

The President cannot be reelected if the economy tanks. He may not even be reelected on an anemic recovery in which unemployment remains nearly this high. But all incumbents are endangered. Republican House members from swing districts are toast if they don’t show voters they’re actively working on the twin problems of jobs and wages.

Several steps need to be taken right away. Exempt the first $20,000 of income from payroll taxes for two years. Lend money to cash-starved state and local governments. Initiate a new WPA for the long-term unemployed. Amend bankruptcy laws to allow homeowners to include their prime residencies in personal bankruptcy (giving them more bargaining leverage with their lenders to renegotiate mortgage loans).

Above all: Washington needs to show Americans it’s taking seriously the ferocious problem of jobs and wages, and the trend back toward a double dip.

Copyright 2011 Robert Reich

________________________________________________________________________

By arrangement with RobertReich.Org.

Robert B. Reich is 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. He has written eleven books (including his most recent, Supercapitalism, which is now out in paperback). Mr. Reich is co-founding editor of The American Prospect magazine. His weekly commentaries on public radio’s Marketplace are heard by nearly five million people.

  Robert Reich: The Truth About the American Economy : Robert Reich traces the history of the economy, from Depression to prosperity and now to stagnation. More
 
  Robert Reich: The Wageless Recovery: Corporate profits for the first quarter of the year are way up. That’s largely because corporate payrolls are down. More
     
  Robert Reich: The Unbearable Lightness of Being Mitt : Robert Reich on Mitt Romney, the political chameleon that says nothing in a crowd-pleasing way. More
 
  Joshua Holland: 5 Fun Facts About the Fight Over the Debt Ceiling : That lawmakers who receive a paycheck to govern this country are threatening to bring about economic catastrophe shows that our discourse is approaching Peak Crazy. More

To read blog entries from Robert Reich and others at GUERNICA, click HERE .

SUBSCRIBE TO GUERNICA’S RSS FEED

 

Readers like you make Guernica possible. Please show your support.

Tagged with:

Share on FacebookShare on TwitterAdd to BufferShare on LinkedInShare on TumblrSubmit to StumbleUpon
Submit to redditShare on App.netShare via email

You might also like

Leave a comment




Anti-Spam Quiz:

Subscribe without commenting