Today's unemployment report is depressing: only 18,000 new jobs added last month after only 25,000 the month before. We need 200,000 -250,000 per month for a solid six months before we can call this a real recovery.
What depresses me more is that the Obama administration has fallen into the Republicans trap by allowing the focus to be on debt and deficits. Remember, House Speaker Boehner voted for wars in Afghanistan and Iraq without a way to pay for them. He supported a costly prescription drug benefit without a way to pay for it and huge tax cuts aimed mostly at the rich. He didn't care about the affect of deficits then but now they are important?
The government should not be running a deficit in good economic times but it should run in bad times. That's not "liberal economic thought" it's mainstream and conservative as well. No serious conservative economist is proposing massive budget cuts right now.
There are only a few ways an economy starts growing quickly after a bad recession. Usually the housing sector leads the way. No chance this time. Sometimes the prices of commodities drop (think gas and food) and that acts like a tax cut. The reverse is happening this time. The government can increase spending on things like bridges, roads, hospitals, etc. The Fed can lower interest rates to get people borrowing again. Rates are already as low as they can go - there's not much more the Fed can do.
I'm trying not to be in a bad mood but today's news is nothing short of depressing.
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