Friday's "Employment Situation" report from the Bureau of Labor Statistics (BLS) showed that 5.4 million Americans have dropped out of the labor force since Barack Obama took office. The labor force declined by 350,000 in November, despite an increase of 191,000 in our working age population.
So, is there any hope for the working class, and for jobless Americans that want to join the working class? As things stand right now, no, there isn't. Here's why.
Right now, America is about 14.7 million jobs short of full employment. To create one average job, someone has to invest about $200,000 in nonresidential assets. Therefore, to create the additional jobs we need, someone would have to invest an additional $3.0 trillion or so in the U.S. economy.
If an additional $3.0 trillion had been invested by the private sector during Obama's recovery, 3Q2012 GDP would have been $1.5 trillion, or 9.5%, higher than it actually was. Real GDP growth during those 13 calendar quarters would have averaged 5.11%, rather than the 2.21% actually achieved. By way of comparison, real GDP growth averaged 5.67% during the first 13 quarters of the Reagan recovery.
Coming out of a severe recession, a sustained period of fast economic growth has been normal for America,. However, under Obama, slow growth and high joblessness has become the new normal.
OK, so, who happens to have $3.0 trillion lying around, plus the knowledge and skills required to invest it wisely to create sustainable jobs? The poor? The middle class? The government?
No, the investment required to transform America's stagnant jobs picture can only come from the people that actually have the money, as well as the demonstrated ability to manage capital investment. In other words, it would have to come from the hated and reviled "one percent".
Obviously, "the rich" are already investing all that they are willing to invest under the current structure of incentives. Obama's plan is to do everything he can to make investment even less attractive for "the one percent" than it is now. This is why economic stagnation has become the new normal.
http://www.realclearmarkets.com/articles/2012/12/10/jobs_under_obama_economic_stagnation_is_the_new_normal_100035.html
So, is there any hope for the working class, and for jobless Americans that want to join the working class? As things stand right now, no, there isn't. Here's why.
Right now, America is about 14.7 million jobs short of full employment. To create one average job, someone has to invest about $200,000 in nonresidential assets. Therefore, to create the additional jobs we need, someone would have to invest an additional $3.0 trillion or so in the U.S. economy.
If an additional $3.0 trillion had been invested by the private sector during Obama's recovery, 3Q2012 GDP would have been $1.5 trillion, or 9.5%, higher than it actually was. Real GDP growth during those 13 calendar quarters would have averaged 5.11%, rather than the 2.21% actually achieved. By way of comparison, real GDP growth averaged 5.67% during the first 13 quarters of the Reagan recovery.
Coming out of a severe recession, a sustained period of fast economic growth has been normal for America,. However, under Obama, slow growth and high joblessness has become the new normal.
OK, so, who happens to have $3.0 trillion lying around, plus the knowledge and skills required to invest it wisely to create sustainable jobs? The poor? The middle class? The government?
No, the investment required to transform America's stagnant jobs picture can only come from the people that actually have the money, as well as the demonstrated ability to manage capital investment. In other words, it would have to come from the hated and reviled "one percent".
Obviously, "the rich" are already investing all that they are willing to invest under the current structure of incentives. Obama's plan is to do everything he can to make investment even less attractive for "the one percent" than it is now. This is why economic stagnation has become the new normal.
http://www.realclearmarkets.com/articles/2012/12/10/jobs_under_obama_economic_stagnation_is_the_new_normal_100035.html
