Economic Flatline Continues

A high unemployment trend that began in late 2001 continues to grip the economy. According to the Bureau of Labor Statistics (BLS), almost 8.1 million people are officially counted as unemployed, adding 27,000 peoples to its ranks in December. Since George W. Bush took office, the number of people who have lost their jobs totals almost 2.1 million. In January 2001, the total number of unemployed stood at less than 6 million.

While the unemployment rate held steady at 5.4 percent, 328,000 people left the workforce adding to a growing number of workers who simply aren't counted as part of the government's official unemployment rate. Almost 75 million adults aren't part of the workforce.

More than one in five workers have been unemployed for more than 26 weeks, meaning their benefits have run out. Those people are left without any income because the GOP-run Congress refused to extend federal jobless benefits.

The government's latest figures also show that a total of 9.1 percent workers or about 14.5 million workers are unemployed or 'underutilized' – that is, are forced to work part time because it is the only work they can find.

While the government also said that businesses created 157,000 jobs last month, this figure barely covers the estimated 140,000 new workers joining the economy each month. Basically, the government's employment numbers show an economy that is continuing to flatline and barely treading water.

Further, the jobs that were added were primarily in industries that pay low wages and few benefits.

In December, the manufacturing sector lost 6,000 jobs down to 14.4 million total jobs. By comparison, at the end of 2000, 17.3 million people worked in the manufacturing sector.

This net loss of nearly three million manufacturing jobs has eroded the wages of working Americans and has struck at the total quantity of benefits workers enjoy. Because of strong unions, manufacturing workers have enjoyed good wages and benefits, bringing up the standard of living of workers across the board.

More than three years since the 'recovery' began and 15 months after some job growth resumed, there has been no sustained improvement in workers' wages. Hourly wages are at roughly the same level as November 2001 and are lower now than a year ago.

During a normal economic recovery, the US economy should have created over 9 million jobs at this point. This puts the jobs deficit at negative 11.1 million under normal circumstances and negative 17.1 million if we count those workers the government describes as 'underutilized' in Bush's economy.

Economists blame Bush's tax policies for the stagnant economy. 'Although the administration claims the tax cuts are working, the actual job growth we’ve seen is far less than was expected with no tax cuts,' said Economic Policy Institute President Lawrence Mishel. He noted Bush predicted his tax cuts would create 5.5 million new jobs since June 2003, but instead the economy had a net job loss.

The president's tax cuts for the rich have bloated the budget deficit and, because the far right despises any programs aimed at boosting the standards of living of working class people, Bush is targeting social programs for deep cuts.

Meanwhile, he has promised his corporate base that he will take his tax and economic policies several steps further in the next four years. According to the Labor Research Association, 'Bush’s pledge to make his tax cuts permanent will add $2 trillion to the debt over the next ten years. Fixing the alternative minimum tax will cost $600 billion and implementing private accounts for Social Security will add another $2 trillion.'

While studies show that economic stimulus tactics that target working people – expanded social welfare, worker training programs, extended and larger unemployment benefits, working class tax cuts – would likely spur a recovery that would see real job growth, Bush and the right-wing ideologues that advise him regard these types of stimulus as 'redistribution' or government 'handouts' and thus bad.

They ignore the fact that the tax cuts for the rich they have pushed through and now want to make permanent along with the privatization of Social Security and Medicare would redistribute the wealth of our country as a whole to the very few, already filthy rich. They sidestep discussing how expensive bailouts for the airlines and subsidies for their corporate partners are much more costly handouts that so far in four years haven't benefited the working class.

Working people have to continue to fight for full benefits for the unemployed, for good jobs for all, for decent public policy that boosts standards of living for working people, and for worker rights and protections. This requires a unified and fighting labor movement ready to block Bush's anti-worker policies and working to organize new workers everyday.



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