Ben Bernanke told Congress today that the economy will still struggle to add jobs in the next couple years. Being the innocent bystander that he is, Bernanke merely forecast these struggles as immutable reality and not something he could possibly work to change:
In recent weeks, there have been a series of positive readings on the economy, including news that job growth was its strongest in three years in March and a report Wednesday that March retail sales rose a strong 1.6 percent. But in describing his view of the economic outlook to the Joint Economic Committee, Bernanke sounded the same restrained tone in describing his expectations that he did in testimony back in the winter.
“On balance, the incoming data suggest that growth in private final demand will be sufficient to promote a moderate economic recovery in coming quarters,” Bernanke said in prepared testimony. He added later that, “if the pace of recovery is moderate, as I expect, a significant amount of time will be required to restore the 8 1/2 million jobs that were lost during the past two years.”
So the chairman of the Federal Reserve, someone with enormous power over monetary policy to improve market conditions for hiring, is telling the unemployed that they’ll have to wait “a significant amount of time” for any jobs to come up. Too bad, so sad.
The Fed chair has several options to promote a faster economic recovery; he has not pulled the string on what can be done. Furthermore, since he has been so willing to enter into conversations about fiscal policy, he should have no problem endorsing the funding for direct hiring in the Local Jobs for America Act, the best jobs bill on the horizon.
A collection of House Democrats and the National Association of Counties urged Congress and the Obama administration Wednesday to support the Local Jobs For America Act, a piece of legislation intended to spur job growth at the local level.
“This critical piece of legislation will help put people to work by allocating funds directly to local communities to stimulate job creation in the public and private sector,” said the association’s President-elect Glen Whitley.
If passed, the bill will provide communities $100 billion over the next two years to prevent businesses and local governments from being forced to cut jobs.
“We need more than just Wall Street improving, we need the jobs on main street,” said Rep. Debbie Wasserman Schultz (D-Fla.).
Policymakers are not innocent bystanders who report on the economy and shrug their shoulders at those left behind. Maybe official Washington is comfortable with a slow, gradual, U-shaped recovery, but the demographic groups bearing the brunt of unemployment – non-white, urban, less educated communities – most certainly are not. “This will be bad for a while” just doesn’t cut it.