Sunday, December 13, 2009

NYT: "Summers Predicts Job Growth by Spring"

Mission Accomplished?

Actually, as DeLong has mentioned, the seasonal adjustment factor in unemployment will start turning sharply positive in January, as the post-Christmas economy always sheds jobs. Since millions are already out of work, its not likely that the economy will shed as many jobs as it normally does. So, we'll likely see job growth in January, but only on a SA basis, in which case Summers will look like a prophet.

What is considerably less clear is whether the economy will add jobs at the pace it needs to make a dent in the unemployment numbers anytime soon. Summers should wait until job growth is above 300,000 to declare victory... On this I agree with Mitch McConnell, populist crusader for the downtrodden.

Then there is this: "Asked what the Obama administration would be doing to create jobs, Mr. Summers said, “Every bill is going to be a jobs bill.” The president plans to spend $50 billion on repairing the nation’s infrastructure, and health care reform — the centerpiece of the Obama domestic agenda — too would help he economy by paring away the nation’s deficit, which he described as an $8 trillion shortfall over 10 years that “the Obama administration inherited.” "

But back in July when California and Pennsylvania were paying their workers w/ IOUs while the unemployment rate was the time to make sure our nation's infrastructure wasn't gutted for budget-balancing cuts. $50 billion is too little.

The question is, what are we going to do if, in March, we are adding only 50,000 jobs a month? Will that be good enough to do more of nothing? It certainly won't be good enough for the voters come November, that's for damn sure. And that will be the end of progressive legislation under the Obama presidency. Liberals will get to wait another 20 years for the stars to align as they just did, to yield large Democratic majorities in both the House and Senate.

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