Weekly unemployment claims spiked up again today, and the NY Fed’s survey of regional manufacturing, a key indicator of the economy, was down sharply relative to expectations. This is a crisis time in the economy, and big solutions are needed to arrest the slide.
The American Jobs Act isn’t perfect, but it would improve the situation in a non-trivial way. Republicans aren’t going to support it, however, so the only value in the plan is as a symbol of what Democrats would do on the economy if they had the control of Congress. It’s a political tool, then, that can draw contrast.
Except Democrats can’t get out of their own way with criticism of the plan, increasingly from the right.
Many Congressional Democrats, smarting from the fallout over the 2009 stimulus bill, say there is little chance they will be able to support the bill as a single entity, citing an array of elements they cannot abide.
“I think the American people are very skeptical of big pieces of legislation,” Senator Bob Casey, a Democrat from Pennsylvania, said in an interview Wednesday, joining a growing chorus of Democrats who prefer an à la carte version of the bill despite White House resistance to that approach. “For that reason alone I think we should break it up.” [...]
Some are unhappy about the specific types of companies, particularly the oil industry, that would lose tax benefits. “I have said for months that I am not supporting a repeal of tax cuts for the oil industry unless there are other industries that contribute,” said Senator Mary L. Landrieu of Louisiana.
A small but vocal group dislikes the payroll tax cuts for employees and small businesses. “I have been very unequivocal,” said Representative Peter A. DeFazio, a Democrat from Oregon. “No more tax cuts.” [...]
“I have serious questions about the level of spending that President Obama proposed,” said Senator Joe Manchin III, a Democrat from West Virginia, in a statement issued right after Mr. Obama spoke to a joint session of Congress last week.
Representative Heath Shuler, another North Carolina Democrat, said Congress should tame the deficit before approving new spending for job programs. “The most important thing is to get our fiscal house in order,” said Mr. Shuler, a leader of the fiscally conservative Blue Dog Coalition. “Then we can talk about other aspects of job creation.”
Outside of DeFazio, these are criticisms that the bill goes too far, that it’s too comprehensive, that it spends too much, that it addresses demand rather than deficit reduction. This is the Democratic Party circa 2011, seemingly interested in nothing so much as their own self-destruction. And there’s nothing here to suggest any level of interest in meeting an absolute crisis with the proper amount of urgency.
Jon Cohn dismantles the specific arguments here. But in the main, this is what happens to Democrats when they have a President they perceive as weak. They distance themselves from him, running in whatever direction possible. There’s a hack gap here, as Republicans typically fall in line behind their party leader. There’s another problem with a media that searches for any little speck of controversy to write the “Democrats in disarray” article they have as a template somewhere.
But the substantive effect of this is that Democrats simply cannot leverage popular support for a plan when they bicker amongst themselves about it. So the jobs bill, already fated to fail as policy, fails as politics as well.




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” . . . this is what happens to Democrats when they have a President they perceive as weak. They distance themselves from him, running in whatever direction possible.”
Yep. You nailed it.
The problem that the Dems have, and Mr. Dayen is a part of it, is that they don’t recognize that big government and more spending is not an answer to structural economic problems. This is not your father’s recession, this is a new world with an information-driven global economy which requires new thinking and progressive answers to a situation never before encountered.
Are jobs as we know them obsolete? What are the chronically perpetually unemployed to do? Is the only (largely) future employment in government, healthcare and retail? These questions and more must eventually be put on the table. Why not now?
But instead we get Dayen’s tiresome fuddy-duddy conservative reversion to old thinking, which most everybody but he and Obama have given up on.
meanwhile central bankers of the world unite to bail out the criminal bankers and fuck everyone else. How long can this criminal cartel keep control? Seems to me, for ever
They want to break up the bill so no single party or person can be blamed for failing the country when it doesn’t pass.
This is just pathetic.
Every single one of these Reps and Senators, every one, has forgotten the oath they swore and the reason their very job exists.
Really?! You’re comparing DDay to Obama? !
Anywho, I disagree with the rest of your comment too. Why overhaul the economy when the previous system worked? Why try to make do in an economy with less regulation and no manufacturing when we can push to regulate industry and recall our manufacturing jobs? Why allow the banks to dictate what we can and can’t do?
What the economy *really* needs is more of the status quo./s Which is exactly what we’ll be getting…
For a year or two I’ve been typing that the only diff bet Rs and Ds are that Rs are batshit crazy. It’s looking that that distinction is going out the window.
What’s changed in the economy in a mere 10 years. A decade ago, when unemployment was 4%, nobody thought there were structural problems.
Whats this? another case of the Dem ‘blue dogs’wanting prime rib when they were offered a balanced diet? As hard as its been to stay with these fucking Dems they need to get the hell out of the way. Our congress is a reflection of our American society right now; its screwed up.
Obama’s inability to get his party in line behind him is really showing here. Maybe it’s all kabuki. Maybe they’re just afraid to do anything.
When will people come to grips with the fact that the Blue Dogs/DLC/Turd Way need to be an extinct species? Health Shuler and HolyJoe are examples 1 and 1a of this.
The “Jobs Act” is a joke, the same tired, stale, unimaginative thinking that always comes out of DC. Even if passed, it wouldn’t to jack shit. It’s just a clumsy PR ploy.
What’s needed is economic reform, but that would mean upsetting the PTB so you know it won’t happen.
Term limits would solve a lot of these problems too. The D’s and R’s become too entrenched and beholding to special interests to really do anything good for the general population.
Good point. Limit a person to one term and there may be a chance that they stop pandering because they don’t need to raise money for reelection.
You also run the risk of them doing as much harm as they can (or good for special interests, depending on which side of the argument you live) because they’ve only got 1 shot and they need to earn their money.
Oh come on, ecahn, surely you’ve heard of the bubbles driven by excessive credit, loose regulation and lack of financial discipline.
Now the chickens have come home to roost, and Stimulus 2.0 is not gonna fly.
How are they different on Krugmanomics stimulus?
The problem is not the bickering.
It is the Dems just spent the last year preaching deficit, then spending for a week, and now back to deficit.
People are confused and think the President is flip flopping and does not know what to do.
Senator Casey is wrong. The American Jobs Act is not “big” legislation.
The Social Security Act was big. The Medicare Act was big. So were the Wagner Act, and the Civil Rights Act and Voting Rights Act. It’s a good thing the Senate wasn’t stacked with risk-averse mediocrities like Casey when those bills were being considered.
A better idea would be to repeal the Bush tax cuts on the rich and use the money to directly employ people. God knows there are roads, bridges, and schoolhouses in need of repair everywhere in the country.
Allow me to bicker, but the jobs bill is a bad bill…trying to tax cut our way out of it while in so doing making Social Security contribute to the deficit while it is supposed to be paid for by the Catfood Commission. Not to mention that the UI part of it is trying to nationalize unemployed Georgia chain gangs to provide free larbor to businesses, which separately undermines the nature of UI rather than just being an UI extension. No Chain Gangs! Don’t Cut The Social Security Income Stream! Don’t Let The Catfood Commission Decide How To Pay For It!
Let’s just go to Clinton era taxation.
Not to mention a decade or more of supply side neeoliberal economic policy.
I asked the Q bc I didn’t know what you were getting at in your comment.
The bubblicious economy was started by Greenspan* & continued by Bernanke. Supply side economics by Reagan. During all those years, there has always been enough fiscal & monetary ammunition to bail out the wrong headed policies with another dose of one or the other or both.
Now have run out of ammunition, but not wrong headed policies. U.S. economy is doomed, but still a lot of wealth for MOTUs & PTBs to raid (SS surplus, P.O surplus), so it will still take quite awhile for them to wreck it completely.
*Wrote a piece titled “Beginning the Next Bubble” in 11/98 after Greenspan bailed out his buddies at LTCM by EASING MONETARY POLICY! That’s when I recognized the fix was in & I’ve been watching them loot the economy ever since.
“…the only value in the plan is as a symbol of what Democrats would do on the economy if they had the control of Congress.”
My memory is pretty bad, but gee, didn’t they have that not so long ago? Oh wait…something about sixty votes…watch and see if the Republicans will let that bother them should they get the chance.
Trigger, trigger, who’s got a trigger? Where’s the easy button on this?
‘Case you didn’t notice, guys, the remote is now permanently on ‘mute.’ Promises, promises. Excuses, excuses. “They are the bad guys; not us.” Ya think?
It is not what you SAY; it is what you DO. Last time I looked we gave this bunch of donothings the store. (There’s a great Gospel parable about somebody with a vineyard letting it out to a bunch of ne’erdowells to manage…)
Ne’erdowells. Just like the last lot.
New wine!
These questions would all be answered by an increase in demand and aggregate spending to a level it was at only a few years ago. That increase in demand REQUIRES massive government spending in the short run. Not having that increase in spending makes all the problems you mention HARDER to solve. Get it? HARDER?
The house is on fire and you want to question whether this is the house we really should be living in, and whether it will serve our long run needs.
That is STUPID. Put the fire out! Get it? If you think a double dip recession or a depression is going to allow answers to your question, you’re deluded. All you’re going to wind up with is a burned down house.
Exactly!
Exactly, econobuzz. The answer is as plain as the nose on one’s face, so the question is: why is our government not putting out the fire? It is government which is tasked with this duty; no-one else can do it. The best comment on this was on these forums by a small businessperson a few days back. He would hire if there was demand, but he can’t do so just on the basis of credits or inducements which are ephemeral at best.
The corporate mentality (which is megacorporate) which now controls government policy can only think of war and more war as the solution to the demand problem. But wars don’t create; they destroy. Lots of folks busy making weapons and you get the problems south of the border, which is close enough to home for me. Security? In your dreams that’s security. That’s folks brandishing weapons at local county commission meetings just because they are entitled to, damn it. Where’s the sense in that?
FDR put a cap on wages in BOTH directions, up and down. And he got the economy where it should be in no time flat. We are in such dire straits that this is the ONLY solution. Everything else is just putting a bit of paint on the lifeboats when they have to be launched before the ship tips any further over and it becomes impossible. Will this crew do that? No, they won’t. We have to get entirely new people that will. We can do that.
I agree. You know the “New Golden Rule”, “He who has the money makes the rules.”
It was designed to fail on both levels bc Obama is not playing to win but determined only to be a good neolib. The legislation is a piss poor dog-and-pony show. Congress will pass the austerity measures and nothing else. Catfood II will devastate the Social Safety Net. Obama will sign all the cruelty and theft into law, destroy the Democratic Party, wreck the economy, punish the American People, and lose the 2012 election to Romney (or Perry if the GOP is willing to roll the dice). Then Obama can go to the World Bank or Wall Street and make a billion dollars, just like they advise at UChicago. Mission accomplished.
Our founding fathers would be very disappointed in what has happend to their country. I don’t think they EVER anticipated this. They were men of honor and dignity and expected the same from others. Now we have a bunch a corporate stooges, crooks, liars, and self-serving bastards.
You’re pissing up-wind, got it?
Massive government spending is a dead duck, as it should be, because this is not a “fire” it is a basic change in the economic structure of the country. The economy simply doesn’t need the number of employees it used to require because the times have changed. This is an information-driven, computerized, cell-phoned, de-industrialized economy where even service jobs like lawyering and accounting, to say nothing of sales and customer service, can be mechanized and outsourced.
There is also the political unreality of any more stimulus. As indicated above, even the Dem pols get it. DDayen, Obama and a few FDL stalwarts are all that’s left of the stimulation movement.
It’s not entirely a bad thing. Americans were buying too much worthless junk anyhow, and it was bad for the environment. Excessive consumption also made a bad model for the rest of the world.
So forget about increasing demand and growing the economy. Look forward to a contracting economy, getting by with less, and decreased reliance on big corporations and big government. We’re going back to the old days when individual initiative counted for more. That’s good!
I agree. That line is definately getting blurred. OTOH, the republicans still have Bachmann, Palin, Cheney, Rumsfeld, Boehner, Cantor, McConnell, Rush, Beck et al. Hard to argue against THAT starting lineup in the lunatic softball tournament.
Anyone ignorant enough to claim that Obama is a Keynesian deserves no notice.
Never argue with a brick.
Define “structural economic problems.”
Manufacturing jobs in China, Viet Nam, Taiwan, Indonesia et al aren’t obsolete. Those jobs used to be here but workers being paid at a level a rung or two above slave labour is very attractive to industrial capitalists. And don’t give me that fascist bullshit about corporate taxes forcing manufacturing out of the country.
In a rare case of the public being somewhat informed, 58% of the people surveyed said the AJA would do NOTHING to reduce unemployment and would underfund social security.
Organizing “democrats” is like herding cats. That WHY republicans, even in the minority are so damned effective. They are organized. Organized morons, perhaps. But organized and coordinated nonetheless. Like the Borg from Star Trek, TNG, beings without brains are easier to control.
Your electronic and IT stuff won’t clothe or feed anybody. Nor will it get you from one place to another. Nor will it produce energy or the items needed to prepare food.
Excellent post. The only way we will grow the workforce is if we bring bacl “some” of the manufacturing and customer service jobs we have lost. Unfortunately, I don’;t have formula for doing that. Anybody here wnaa jump in.
Very good comments today!
Wait, wait, don’t tell me: were all the economists “surprised” at this?
Bickering is not the real problem. The fact that so many Democrats want to water down the actual “job creation” portion of it, weak as it already is… is the problem.
In the end, the Democratic Leadership was fine to start off with a crappy bill, most of which is about defunding Social Security (and thusly NOT about jobs at all). The aid to states, while important, is not nearly enough. The infrastructure stuff is just a drop in the proverbial bucket that spread across 50 states will save a few jobs, but won’t actually reduce the unemployment rate.
On top of all this, Obama wants this to go through the Supreme Soviet, erm, Super Duper Congress, so they can find other offsets to make it somehow fiscally neutral. In other words, the last thing this government wants to do is actually stimulate the economy!
To sum up, what leadership wants is to defund Social Security, save a few jobs… all while not doing a damn thing to increase aggregate demand in the economy. So create a few jobs with one hand, while destroying other jobs elsewhere.
And we’re supposed to be upset about some petty bickering that is nothing more than posturing over corporate interests and what their lackeys in congress can do for them? How about we get upset at our overlords for limiting us to fighting over table scraps? How about we find some dignity somewhere and call FOUL on the whole thing?
wow, some very bold and deep thinking here.
Obama could come out in support of Lautenberg’s 21st Century CCC/PWA-type jobs program.
He has the legislation ready to go.
Also, why can’t Obama do what FDR did? Establish jobs programs by executive order?
I mean, aside from his not wanting to do any jobs programs per se.
Rapid turnover will just make it easier for the PTB to buy elections. Fresh whores are cheap whores.
He’s a troll. Let him be.
We’d end up with a situation like we have here in FL. The districts have been gerrymandered in such a way that the Regressives maintain control of the legislature for the foreseeable future. In addition to ALEC writing legislation the local lobbyists write a lot of legislation and are the ones who show newly elected legislators the ropes. Term limits are a bad idea.
I know but I like givin’ ‘im shit. He deserves it. And I’m bein’ nice today.
Bacon is OK in moderation, extreme moderation. Otherwise, not that good for anyone.
I supppose the “jobs” will be in “the cloud”….
There isn’t a distance far enough that they can run to escape prez. sellout. We are witnessing the destruction of the D party. Maybe now we can start over and build from the ground up.
Yout intrinsic problem is you do not address this:
Yes, Globalisim, and how it is practiced today. Where Capital is given free reign to exercise it most odious aspects of nailing local labor to a corss of iron while labor, people, have nothing. Then it can discard them at will when the next slave market ripens. Leaving behind a shambles.
Adress this problem with the World Bank, GAAT, lack of tariffs, worker protections and the intrinsic understanding the business, capital, exists at the pleasure and permission of the people, that economies and governments must first and foremost serve the needs of its citizens, not the other way around as it is today. When you realize the the solutions start presenting themselves ery easily.
To accomplish this it takes government that is respnsive to the people and has the power to exercise this control over entities that only serve to extract wealth from society. “Big governemnt and more spending” is just bullshit that is clouding your perception. Try not to fall into cute right wing CONservative buzzwords.
Organized morons supported by billions in private money (e.g. Koch’s, Coors, Etc.). Put a powerful enough engine on it and even a bathtub can fly. That’s the problem. We need to get the money out of our politics and have it federally funded and heavy restrictions on movement between government and private industry. The morons will collapse overnight.
The Dems no longer have a definitive “Party platform” because the one Obama established in his campaign was quickly discarded by Obama himself once he got the nomination (FISA vote, etc.)and it continued when elected. Without a definitive platform and the party unity that should accompany it, it’s not surprising in the least this is going the way that Obama’s healthcare and others did in that some will not be on board for their respective reasons. Once Obama got elected it’s been divide and conquer WRT Dem congresscritters. No definitive Party platform means no definitive Party unity which means no definitive collective interest. It’s the centrist, bipartisan MO Obama has had from day one. Nuff said. Can’t make it much simpler than that.
100% correctamundo. But I suspect I will not live to see that. I’m 60. I do, however, hope we WILL get there. Our future depends on it.
Term limits without campaign finance reform and other reforms regarding a return to private life from public service would just further restrict the non-rich from running for office.
Political positions are essentially short- or long-term contract jobs and, with term limits, a guaranteed non-renewal at the end. What person has a job he can take one or two years or more off of without severe financial risk?
Corporations are chartered and operated to make a profit for their shareholders, not provide benefits for workers. If you don’t like the system, there’s always China.
I’m a vegetarian myself. Never touch the stuff, even though it smells good.
I can’t, very well. But I do think we ought to try to define what the differences are between what we have now and what we used to have. Defining the questions would in themselves help to define the answers.
Here’s a start. Some of the differences are obvious, others not so. I’m not an economist. Manufacturing has been altered in large part due to a strong dollar and free trade. Service jobs are doable elsewhere. There are dozens of outsourcing companies active in the US, ready willing and able to shift almost any US job to another country. That’s new. There have been changes in credit — it’s tighter. And people are saving — that takes a lot out of the economy.
Business regulations and taxes have more of an impact, as does mandatory medical insurance. Demographics — Americans are older, sicker and fatter. Obesity and diabetes are prevalent. That’s a big change (pun intended).
All of these are structural — or semi-structural — changes to economic life as we knew it. I believe that true progressives should be honest about the situation and seek new ways to address the problems and not fall back on old-school throw-money-at-it practices which are not remedial.
In a recent “smell-off”, the top three “pleasant and most recognizable smells” were: #1 coffee brewed/brewing, #2 bacon cooking, #3 freshly baked cinammon rolls.
Lord who wants to return to the slash and burn plundering with serial crashes in our economic history. That’s what poorly restrained capitalism does.
I suggest you read the history then come up with how you would like it to be.
Good, I’m glad that this won’t pass. More tax cuts? Free trade deals? Who the hell needs them? We’re only making the problem worse. This is just along the same line of thinking that we need to re-elect Obama because he is such a progressive guy. He is a Republican masquerading as a Democrat and destroying the party in the process.
If he had any balls whatsoever he’d stand up to the entrenched interests, show the morons what needs to be done and make something happen. Instead, Mr. bipartisanship is going to screw us, bringing in at least 4 years of Republican rule and doom the party until 2016 at the earliest.
Nice job Obama, I couldn’t have HOPEd for a worst outcome.
I don’t like the system and I am here working to change it as is my unalienable right as a human being, and an American citizen. To modulate, re-regulate, and end if necessary, these sociopathic creations that have twisted the original laws that allowed them to exist in the first place. To also reign in Capitalism and its worser aspects, as it is a failing system, like Communism, and cannot sustain mankind into a better future. I know this is a complex subject for a simpleton like you, still, try to keep up.
I am glad to see that you admire these sociopathic entities so much, like a litte Ayn Rand. I suggest you take your suggestion to heart and you move to China where Capitalism works very well in a large slave-type worker market with no regards for worker, or community saftey, and all concerns are on profit. Join the slaves and enjoy your crumbs, fool.