A generation of young peoples lives are being destroyed, futures are being stolen because of gridlock in Washington DC. People who played by the rules, went to college, got a job, got married, bought a house only to lose what they had earned. Others got out of college at a time when there were no jobs. No Future. Boomers have seen their productive middle aged years dumped in the same gridlock based dumpster.
Whats the solution? A Realistic stimulus bill that employees the majority of those who want to work. How many people is that? Well the U6 uneployment rate is at 13.8%, with a workforce of a 154 million people, thats 21.2 million un(der)employed. And thats not counting everyone, call it 26 million, as Meteor Blades recently commented.
The multiplier for infrastructure spending is 2.5 in a recession. So a trillion spent would create 25 million jobs. Back in October of 2009 U6 was 17.1%, about 26.5 million people, call it 31 million people if we're going to try and count everyone.
A stimulus package to create 31 million jobs would have cost about 1.25 trillion. Economist Dean Baker has written and spoken about the hole in the economy, and what it would take to fill it.
When the bubble burst, there was nothing to replace the lost demand.In late 2008 Christine Romer (the incoming head of the Council of Economic Advisers) advised a 1.8 trillion dollar stimulus package in a December 2008 memo.
All of this seems clear and simple. We lost $1.2 trillion to $1.4 trillion in annual private sector demand.
members of the president's economic team felt that if they were to properly fill the hole caused by the recession, they would need a bill that priced at $1.8 trillion -
"When Romer showed [Larry] Summers her $1.8 trillion figure late in the week before the memo was due, he dismissed it as impractical. So Romer spent the next few days coming up with a reasonable compromise: roughly $1.2 trillion,"Dean Baker again:
We will never know if President Obama could have garnered support for more stimulus and larger deficits if he had used his office to pound home basic principles of economics to the public and the media. But we do know the route he chose failed.And the fact of the matter is that with a GOP controlled House, getting real problem solving legislation thru the House is impossible. And the filibuster rules in the Senate reinforces this gridlock. Since the ARRA passed we've seen 3 years of gridlock.
Time for placing blame on any one person is long gone. However it happened opportunities have been lost, time has been wasted. Median Household income has dropped from 50k to 45k, increasing Income disparity has continued on its merry way and there's no solution in sight.
Busting up the gridlock:
Filibuster reform by Reid? Getting something past the GOP House? We know the GOP House would kill anything of value, and there in lies a path out of the woods.
Proposing a realistic stimulus package that would create 20 million jobs would likely have trouble being passed by Senate Dems, but it might have a much better chance if filibuster reform were enacted. This would require modifying rule 22, require actually talking, if you want to filibuster. I think changing the cloture vote from 60 to 55 or 54 votes would go along way in regards to breaking up the gridlock in the Senate.
If the Senate is one vote shy, then twisting an arm can be very useful. But when you are 5 or 7 votes shy, the arm twisting effort becomes diluted and ineffectual. If one dangles the possibility of a 250k grant for one Senator's home state, in front of 4-5 Senators, with the understanding that the offer is only good for one Senator, you in effect create a little competition to see who gets the favor.
So far we have greatly increased the chances of success, but the GOP majority in the House stands in the way. I say let the GOP kill the stimulus, fine. And in 2014 we run in that. In 2014 we make it damn clear who voted to kill 20 million jobs.
I firmly believe that Democrats would not just get the House back, but would gain a workable majority, even recouping the 2010 losses. I also believe that Dems would gain in the Senate. Then we can pass realistic economic reforms & financial regulations like the Glass Steagal bank firewall.
Or we can wait until the next economic downturn comes. The current economic environment is not stable, the double dip has come and gone, and some countries are facing a triple dip. The US economy is on a knife edge, ready to be toppled into another recession. And we can all sit around and watch more families getting crushed as a real Depression starts. And maybe then the pain will be high enough so that entrenched corporate interests are voted out in mass, just like 1932.
11:55 AM PT: 11 votes for a 7.09 average.
12:40 PM PT: 17 votes for a 6.94 average.
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Sun May 05, 2013 at 5:26 PM PT: 34 votes for an average of 8.0