Employment Rose Surprisingly, But Obama Needs a Stronger Plan to Maintain Growth
President Obama today will go to a fire house in the Virginia suburbs of Washington to tout his plan to promote hiring of veterans as first responders. It's a program that is sorely needed to address an American travesty: One out of every eight of the veterans returning from Iraq and Afghanistan are out of a job.
But as today's unemployment report from the Bureau of Labor Statistics shows, the economy could still use a job corps for the rest of us as well.
The news is good: 243,000 jobs were produced in January, and the unemployment rate went down to 8.3 percent. That includes 257,000 in private sector jobs, offset by a loss of 11,000 local government jobs and 6,000 federal government jobs. With that report, the economy has seen under President Obama's watch 10 quarters of economic growth and five quarters of jobs growth. The report shows growth across the private economy, notably in manufacturing and construction.
But, as Campaign for America's Future co-director Robert L. Borosage said in a statement this morning, "don’t break out the bubbly. Any celebration should stay sober."
"The U.S. economy is still slogging slowly against fierce headwinds. We are still 6 million jobs short of where we were when the Great Recession began. There are still 21 million people in need of full-time work. There are still more than four people lining up for every available job.
“Federal Reserve Chair Ben Bernanke stated the simple reality: `We still have a long way to go before the labor market can be said to be operating normally. Particularly troubling is the unusually high level of long-term unemployment.’ Nearly one-third of the unemployed have been out of work for a year or more. These are the true casualties of Wall Street’s excesses.
“American companies are producing more now than they did before the collapse. But Americans aren’t sharing in the rewards. Profits margins are at record heights; CEO salaries have soared, but there is no recovery in jobs, and wages and benefits continue to fall behind.
“Austerity continues to impede the recovery. Government employment was flat last month, but state and local governments project more cuts. Austerity in Europe is driving the EU and the United Kingdom into recession. U.S. exports will suffer accordingly, even without a Greek default or a financial calamity. U.S. government spending will be constricted by the budget deals."
As we reported last month, the economy needs to be creating more than 400,000 jobs a month for the next three years in order to repair the damage done by the 2008 economic crash. By that measure, we're already 157,000 jobs behind where we need to be this year.
The Congressional Budget Office warned this week that if Congress and the White House does nothing the economy will continue to creep and the unemployment rate will go up above 9 percent in 2013, before it finally slides downward.
White House officials have expressed annoyance with the CBO projections, but they are also assuring progressive activists that they will over the next few weeks continue to press the proposals in last year's American Jobs Act, including aid to state and local government to support schools and local police and fire departments.
We remain critical of the scope of the administration's proposals. But they would at least move the nation forward in providing some meaningful relief to the nation's unemployed. Conservatives in Congress, on the other hand, remain determined to take actions that will move the nation backward.
The latest example is a transportation bill moving toward the floor of the House of Representatives that Transportation Secretary Ray LaHood, a Republican who used to serve on the House Transportation and Infrastructure Committee, told Politico is "the worst transportation bill I’ve ever seen during 35 years of public service."
The proposal is just $260 billion over five years; by comparison, the last full transportation bill passed by Congress, signed by President Bush in August 2005, was $286 billion for a period that would end in September 2009, and most transportation experts, including those at the Chamber of Commerce, believed that level of spending was grossly inadequate.
But worse, the bill is stuffed with poison pills, such as oil drilling in the Arctic National Wildlife Reserve and forced approval of the Keystone XL pipeline, designed to appease the oil industry and anger moderate and progressive constituencies that normally would rally around a transportation and infrastructure bill. Meanwhile, it cuts funding for high-speed rail, transportation safety for school children and, if House Speaker John Boehner has its way, public transit.
Even with that, the Club for Growth is urging House members to vote against the legislation because they deem even a meager $260 billion as too much to spend to make sure that the country can move its goods, services and people efficiently.
That is madness at a time when we need to prepare our transportation networks for future growth, and at a time when we have 13 million people out of work. One way that President Obama could respond to today's unemployment report is to tell Congress to pass a real transportation bill that would put Americans back to work quickly, and reject the kowtowing to Big Oil that conservatives have inserted into this bill.
Yes to a job corps for veterans, but don't stop there.