Ed,
Having failed to produce more employment by his
Keynesian money-printing methods, Bernanke is now
trying to throw the blame onto Congress! The
irony is that, in fact, members of Congress have
already brought about a great deal of extra
employment over the years when getting funds for
pork barrel projects in their own constituencies.
These have usually been successfully achieved by
tucking them inconspicuously into larger pieces
of legislation. These projects, too, have been
adding to government deficits every year, just as Bernanke has.
It's also nonsense for Bernanke to suggest that
lessons could be learned from the emerging
nations, and particularly China. True, their
governmental budgets are often far more
disciplined than ours but that's mainly due to
centuries' old cultures which means that their
people, to a very considerable extent, will do as
they're told. China, for example, doesn't have
anything like a welfare state or social security
(worth speaking of) either. This means that
ordinary people save as much as 30% or 40% of
their earning against their old age or for health
reasons. If Americans were to go anywhere near
that level of savings then it would kill even the
present depressed economy stone dead.
Bernanke is becoming panicky -- as well he might.
Also, I suspect, he's trying to distance himself
from Obama who, probably, won't get re-elected in 2012.
Keith
At 14:30 29/09/2011, you wrote:
From today's Globe and Mail.
Ed
Long-term unemployment in U.S. a national crisis, Bernanke says
MARTIN CRUTSINGER
WASHINGTON The Associated Press
Last updated Wednesday, Sep. 28, 2011 9:37PM EDT
In unusually strong language directed at U.S.
politicians, Federal Reserve Chairman Ben
Bernanke has called long-term unemployment a
national crisis and suggested Congress needs
to act on jobs and the housing industry.
Mr. Bernanke noted that about 45 per cent of the
unemployed have been out of work for at least six months.
This has never happened in the post-war period
in the United States. They are losing the skills
they had, they are losing their connections,
their attachment to the labour force.
He added: The unemployment situation we have,
the job situation, is really a national crisis.
Mr. Bernanke said the government needs to
provide support to help the long-term unemployed
retrain for jobs and find work. And he suggested
that Congress should take more responsibility.
Responding to a question, Mr. Bernanke said
long-term unemployment, budgetary discipline and
housing policy were the three most important
areas where Congress could contribute to an economic recovery.
There are certainly some areas where other
policy makers could contribute, he said.
Mr. Bernankes comments were his latest in a
public effort to get Congress to act further to
rejuvenate the economy. He suggested that the
Fed can achieve only so much through policies
that seek to lower long-term interest rates.
The Federal Reserve has made enormous efforts
to try to help this economy recover and
stabilize through its control of interest
rates, or monetary policy, he said. Those
policies have driven rates to record lows.
Monetary policy can do a lot, but monetary
policy is not a panacea, Mr. Bernanke said.
On the housing crisis, he said strong government
programs to help the industry recover would aid
the Feds own efforts to boost housing by
driving mortgage rates to their lowest levels in decades.
In his speech, the central banker said the
United States and other rich nations could
relearn a few lessons from fast-growing developing nations.
He said the successful emerging economies such
as China had adopted disciplined budget
policies, embraced free trade, made public investments and supported education.
Advanced economies like the United States would
do well to relearn some of the lessons from the
experiences of the emerging market economies,
such as the importance of disciplined fiscal policies, Mr. Bernanke said.
But in the question-and-answer period, Mr.
Bernanke cautioned U.S. lawmakers against
cutting deficits too quickly to reduce budget
deficits. He has said that could put the fragile economy at risk.
He noted in his speech that emerging markets
such as China account for a large and growing
share of the global economy, so they need to act accordingly.
With increasing size and influence comes greater responsibility, he said.
Emerging nations will be challenged in the
future by their reliance on exports to drive growth, he added.
The Obama administration has been pushing the
Group of 20 major economies, which includes
traditional powers such as the United States and
emerging economies such as China, Brazil and
India, to boost domestic demand rather than
relying so heavily on exports to rich nations.
Keith Hudson, Saltford, England http://allisstatus.wordpress.com/2011/09/
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