Sunday, November 06, 2011

Unemployment Drops Below 9%

That was the headlines, that we only created a net gain of 80,000 new jobs. But that is only half of the story, the private sector had a gain of 104,000 jobs and that was offset by a loss of 24,000 of public sector jobs due to budget cuts. As the Republicans swing there budget cutting axe and refuse to raise taxes on the millionaires and billionaires the numbers will continue to climb. Some see this as good, but the brunt of the slashes is where it hurts women and child and the disabled. The “Safety Net” is being torn to shreds, just when we need it the most. Millions of unemployed workers who worked their whole life are going on food stamps because their unemployment insurance is running out.

An article in the Nation called “War Against Government Workers Is Prolonging the Recession” by Ari Berman highlighted the effects of the budget cuts,
This is by now a depressingly familiar story. In the past year, 1.6 million private sector jobs have been created. But since the recession began in December 2007, more than 500,000 public sector jobs have been lost. Half of those jobs have disappeared since January 2011, after Republicans (who ran on improving the economy in 2010) took control of the House of Representatives. States have cut 49,000 jobs and localities have cut 210,000 jobs since the beginning of the year. Contrary to what Republicans might tell you, these are “real” jobs lost by real people, who pay taxes, spend money, provide for their families and perform vital public services. When they suffer, the economy suffers too.
That is a total of 259,000 jobs and that doesn’t even count the loss of jobs in the private sector because of the budget cuts. We cannot balance the budget without tax increases for the mega rich.

Congress (both the Democrats and the Republicans) and the President (Bush) had no problem bailing out the banks that were “too big to fail”, but the Republicans refuse to help create jobs for the ordinary people. The article goes on to say,
Just last month, Republicans in Congress blocked a section of Obama’s jobs plan that would have prevented 400,000 teachers, firefighters and cops from losing their jobs through aid to state and local governments, which is among the most effective forms of stimulus. “Federal aid to strapped state and local governments also is providing significant economic benefits, lessening their need to slash programs and jobs or to hike taxes and fees,” wrote Mark Zandi of Moody’s in July 2010. Had it not been for austerity policies, wrote David Leonhardt of the New York Times, state and local governments would have added half a million jobs, rather than cutting them. “In other words, the state and local austerity of the last two years has cost the economy about one million jobs,” Leonhardt writes.
The Republican job plan is to cut taxes even more on corporations and the mega rich. The Regan administration called this the trickledown theory and after thirty years we have seen what trickledown and it is brown in color. The Bush administration gave to the rich the largest tax cut in history back in 2001 and we went from having a budget surplus to having some of the largest budget deficits in history which plunged us in to a depression.


  1. You might want to look at

    for a table about midway down on which percentiles pay what in income taxes. The numbers clearly show that the 1% ers pay 30-35% of the Federal Income tax. Their effective tax rate is 23% which is the highest tax rate already. So how much do you want out of them? Another 50% that would only raise 2 trillion and the government overspends by more than that.

    So government spending has to be cut and that means you either cut government workers or social safety net programs like SS, Medicare, and unemployment benefits. Not only is the Federal Gov't running out but so is almost every state gov't as well.

    Governments at all levels have kicked the can down the road for years and years and it is high time that we start to work together to fix the problems once and for all rather than use simplistic solutions that only delay the inevitable.

  2. I never said that taxing the rich would balance the budget. But rather it has to be a combination of cuts and tax increases. No matter where you cut the budget there will be layoffs. But I favor keeping the safety net and more cuts to defense and non-social services.

  3. When I heard that the unemployment rate had dropped, the first thing I thought was that lots of people's unemployment insurance had run out. When they are dropped off the roles, they are no longer counted as unemployed, giving the illusion that things had improved.

    I agree with you regarding cuts to defense rather than cutting social services. I'd rather see our tax money going to help our own people, not buying very expensive armaments to blow up on foreign soil.