A few thoughts from Professor Krugman on unemployment and my own on the mid-term election

One of the issues in the mid-term elections is the failure of the economy to fully recover.  Having watched bits and pieces of the new Ken Burns series on the Roosevelts  I see some parallels between FDR and President Obama.  Both Presidents saw the economy begin to slow after showing good signs of recovery. In FDR’s case it actually fell back into recession.  The mistake in both cases is, at least in part, the failure to continue to fund government programs to create jobs,  to end the programs too quickly.  FDR came to understand this; Barack Obama always did.  But the current Congress doesn’t seem to get it.

Breadlines: long line of people waiting to be fed: New York City: in the absence of substantial government relief programs during 1932, free food was distributed with private funds in some urban centers to large numbers of the unemployed. (Circa February 1932)

Breadlines: long line of people waiting to be fed: New York City: in the absence of substantial government relief programs during 1932, free food was distributed with private funds in some urban centers to large numbers of the unemployed. (Circa February 1932)

At the end of my work life I got to administer some of the stimulus funding.  What I saw was not the direct creation of a huge number jobs with government  funding, but many jobs created as the result of the opening of a new business, new hotel, or new housing.  Those employed persons paid taxes which helped bolster the economy.  If the benefits of having people employed are obvious to an economic novice like me,  I don’t understand why the Republicans in Congress don’t want to fund infrastructure projects.  Road and bridge repairs, creating a grid that can tie in with alternative energy sources, construction of affordable housing:  these are just a few of the types of projects that can be government funded and that can create jobs.  While construction jobs may disappear, the infrastructure created will result in new opportunities.

Paul Krugman’s recent column helps me understand a little what may be going on.  He begins

Last week John Boehner, the speaker of the House, explained to an audience at the American Enterprise Institute what’s holding back employment in America: laziness. People, he said, have “this idea” that “I really don’t have to work. I don’t really want to do this. I think I’d rather just sit around.” Holy 47 percent, Batman!

People are just lazy.  Krugman continues

First things first: I don’t know how many people realize just how successful the campaign against any kind of relief for those who can’t find jobs has been. But it’s a striking picture. The job market has improved lately, but there are still almost three million Americans who have been out of work for more than six months, the usual maximum duration of unemployment insurance. That’s nearly three times the pre-recession total. Yet extended benefits for the long-term unemployed have been eliminated — and in some states the duration of benefits has been slashed even further.

The result is that most of the unemployed have been cut off. Only 26 percent of jobless Americans are receiving any kind of unemployment benefit, the lowest level in many decades. The total value of unemployment benefits is less than 0.25 percent of G.D.P., half what it was in 2003, when the unemployment rate was roughly the same as it is now. It’s not hyperbole to say that America has abandoned its out-of-work citizens.

If unemployment is too costly, then any kind of jobs program must cost way too much.

…My question for today is instead one of psychology and politics: Why is there so much animus against the unemployed, such a strong conviction that they’re getting away with something, at a time when they’re actually being treated with unprecedented harshness?

Is it race? That’s always a hypothesis worth considering in American politics. It’s true that most of the unemployed are white, and they make up an even larger share of those receiving unemployment benefits. But conservatives may not know this, treating the unemployed as part of a vaguely defined, dark-skinned crowd of “takers.”

My guess, however, is that it’s mainly about the closed information loop of the modern right. In a nation where the Republican base gets what it thinks are facts from Fox News and Rush Limbaugh, where the party’s elite gets what it imagines to be policy analysis from the American Enterprise Institute or the Heritage Foundation, the right lives in its own intellectual universe, aware of neither the reality of unemployment nor what life is like for the jobless. You might think that personal experience — almost everyone has acquaintances or relatives who can’t find work — would still break through, but apparently not.

The bottom line:  If you are still unemployed or if you are poor it is your own fault.  Besides, those people live in a world far from the world of Fox News.

I hope that people think about the state of the semi-recovered economy when they vote and that they vote for candidates who can learn from the lessons of the Depression, will vote some funding for jobs programs and not worry so much about the deficit which is shrinking.  They should instead worry about our infrastructure which is failing.  If they fix that, they may find people aren’t lazy, they just need jobs.

 Photograph:  Picture from the Franklin D. Roosevelt Library, courtesy of the National Archives and Records Administration

3 thoughts on “A few thoughts from Professor Krugman on unemployment and my own on the mid-term election

  1. Republican elites don’t like any infrastructure projects, or welfare, or unemployment insurance simply because the 0.1% pays GOP politicians to keep their taxes low. All that talk about dark skinned takers is mostly for the party base.

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