Jared Bernstein has an Op Ed in the NYT 5/4/2013, titled WHERE HAVE ALL THE JOBS GONE?
http://www.nytimes.com/2013/05/04/opinion/where-have-all-the-jobs-gone.html After rehearsing some background he concludes with this sentence: "What I do see is a growing disconnection between growth and jobs. Setting a path to full employment is the best way to alter that dark vision." I'll past a longer quote below. Meanwhile, the March 2013 Levy Economics Institute published "IS THE LINK BETWEEN OUTPUT AND JOBS BROKEN?" By Papadimitriou, Hannsgen and Nikiforos. The article's telling sentence is this: "The linkage bnetween output and jobs creation has become INCREASINGLY weak in the last three decades." (The authors emphasized "increasingly"). They never get around to answering the question in the title. Like Bernstein, the Levy authors recommend, well, let me call it stimulus. They have plenty of company -- Krugman on down. Here are the final paragraphs from Bernstein's Op Ed: "What would it take to reverse these trends? For one thing, in the near term, do no harm. Austerity, including sequestration, is the economic version of medieval leeching. The Federal Reserve continues to apply high doses of monetary stimulus, and that’s supporting low interest rates, which in turn are linked to the improving housing market. But it can’t do it alone, and Congress is counteracting such tailwinds with fiscal headwinds. We also need a significant, permanent program to absorb excess labor (an explicit part of the Humphrey-Hawkins law). We should consider restarting and rescaling a subsidized jobs program from the 2009 Recovery Act that, though relatively small, made jobs possible for hundreds of thousands of workers. And we have to reassess our manufacturing policy, including reducing the trade deficit. That means both reshaping our dollar policy — going after competitors who suppress their currencies’ value to get an edge on net exports — and public investments in areas where clean energy intersects with production. Finally, financial deregulation has become the enemy of full employment: it funnels capital to unproductive parts of the economy, and plays a key role in the “shampoo cycle” of bubble, bust, repeat. Less volatile capital markets mean fewer shocks to the job market. If that is too interventionist, there’s another approach. Like many European countries, we could ask less of our people in terms of work, and hold them harmless by broadly redistributing our productivity gains. But I don’t see that in our future. What I do see is a growing disconnection between growth and jobs. Setting a path to full employment is the best way to alter that dark vision." Consider those last two sentences: He's euphemistically talking about reducing the hours of work without cutting take-home pay. But that can't happen, in his view of the future. (Of course it can, and will.) The Levy authors don't even go that far. And Bernstein speaks not of a looming disconnect between jobs and income, though Romney and George Schultz see it. All is "madmen in authority". Gene PS We do have the "significant, permanent program to absorb excess labor" that Bernstein calls for. We call it prison. Want to expand it? _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
