I will offer a way forward to blunt this dismal news. But the uncomforting fact remains that this will be the most dismal December in memory in a fundamental way.
Congress inability to free itself of the undemocratic filibuster methods of Conservatives seems likely to be the end of beneficial health reform. Why do we still allow the regressive elements to cling to the filibuster devise used first by violent southern bigots to prevent democracy and which continues to be used by Conservatives to stall this democracies best reforms? While disapointed over the passage of Obama's never written into law plans and most of the best of reform there is a much bigger pall over this Christmas.
This is a year a conservative caused slump killed Christmas and so killed much more of an economy badly in need of a new direction. Unlike the last time we were brought this low the seeds of our renewal are not in flower today.
The following is a prediction based on a disasterous and most likely our current reality. The employment prediction should be checked starting in March. But if this Christmas is anywhere near as dismal as Gallup is finding then you don't really need a crystal ball:
Self-reported consumer spending was down more than 20% in each of the last three weeks from last year's depressed weekly comparables. At the same time, Gallup's Economic Confidence and Job Creation Indexes were essentially unchanged.
http://www.gallup.com/...
This three weeks? This big a decline in Christmas spending means consumers won't spend until their own solvency seems certain. And what will resolve an uncertainty big enough to spoil this country's Christmas? If Christmas doesn't bring out shoppers then we are in a very deep hole.
Much of the existing retail outlets won't survive another year. Most the corporations will still exist – though a large number of them will be in or planning bankruptcy next Christmas. Some of the oldest and biggest won't survive this season. But the number of outlets is what will plummet the most as corporate bean counters decimate whole regions with massive store closings.
The ripples are going to seem like tidal waves. Remaining manufacturing will die at the same time retail does in the next year. The unemployment rate spike will first be noticed around February 1st but it will grow even larger by March. Then every other industry dries up a little more.
The level of joblessness coming could keep us from completing any national goal but if we bail out consumers with federal jobs then we will lift the boats of all the other institutions including banks and states .
So, What stopped the last such downward spiral?
Ronald Reagan was the luckiest President in history. He waltzed into a computer revolution that saved him. The PC was introduced in 1980, Even though it was a much smaller output than in later years the computer industry employed it's greatest number of domestic employees in the very year that the Reagan employment slump started getting better. See chart on page 2. http://www.bls.gov/... Reagan was saved by the birth of an industry unprecedented in it's effects on most industries efficiencies. PC's were able to be deployed with very marginal starting costs and scaled up steadily over the decade as they proved themselves. If there is anything on the horizon similar in beneficial effects it has not begun to be deployed.
But deployed hydrogen energy might well have the same sort of effects – it can be a much less expensive alternative to gasoline for cars and massively reduce our oil use within a decade. Unfortunately the start up costs are large and must be ahead of the benefits. Likely only a massive government programs will swiftly create the millions of fueling stations needed to replace gas stations.
http://www.hydrogencarsnow.com/...
http://www.hydrogencarsnow.com/...
A more affordable hydrogen car would need to be engineered by Detroit as well though given scale that won't likely be much of an effort since other nations have developed them.
http://gwiz.myfastforum.org/...
This is only one of the myriad of ways to resolve our current idleness. It is my favorite because it's effects might be the greatest. But we can also have the federal government DIRECTLY responsible for building roads, schools, smart lines (that save electricity) , Internet II (Speeds beyond your experience) , and broadband over power line (for the 75% of our land mass that has no broadband.) all those things that Obama has talked about doing but that still are not being done.
These stations can be built by the government and leases auctioned for a couple of years to private operators. The leases would go for peanuts at first but over 20 years – with coast to coast stations for the existent hydrogen car lines being built and in the face of rising oil prices – they will return the governments investment several fold. It might mean canceling and diverting repayment for the corporate welfare TARP and diverting money from the ME. A pilot project in a small state, then a large state then a region might be the best way but it doesn't need to expand the size of government spending. We just need to realize our priorities in all the masssive federal budget.
Our priority has to be putting the country back to work so we can start achieving all those other national goals which only a prosperous citizenry can afford.
There are a few other such options for public spending with very good likely results but this likely has the biggest reward and the biggest employment/cost. Right now infrastructure costs are both a risk and a necessity. If not hydrogen then something will need to be built to directly employ workers and for the increased consumption and also in an endeavor that can be used to expand all business and employment growth. A combination of reduced
Now how will it work to expand employment for the government to give funds to Teas Governor Perry in order to put a band aid on his states public projects. Governor Perry isn't as interested in new jobs as he is in reducing the tax load on his wealthy cronies. If he can replace the funding for all the necessary Texas road projects for the next ten years with federal funding he will do that. He can use saved state revenues to enrich those cronies of his with tax breaks or other sweetheart deals. Does anyone doubt that is what Perry would do or know how that could be stopped? The 'jobs' plan included in the stimulus is a good way to help states. It won't create any knowable quantity of jobs because most states are broke and many will just divert these funds – which like all grants to states are fungible. http://www3.interscience.wiley.com/...
As for tax cuts to ANY business to employ more workers – Any employer making massive hires for a market that is retracting will gain a $2.00 subsidy for a worker costing many times more money and his product increase will not be sold in this market. It is that last problem of the product not being sold that makes this plan unworkable. If there was no Grinch this Christmas making sales plummet then this would increase the rate at which business expanded. With this weak an economy it will just invite fraudulent raids on the Treasury as the same investors can close a plant in one place and open it with the same number of workers under a different incorporation and cash a windfall for hiring 'more' workers.
The countries current course will not work. The republicans who created this mess would be worse – they would just send more consumers money to a few of what has recently been characterized as 'fat cats' by a President that can talk the talk of Progressives at the least. Tax cuts in this economy will be hoarded by consumers. Big business will do worse with windfalls – they will ship them to countries growing – largely to China and India and Brazil. What the globalists still don't fathom well – we live here. Shipping business overseas must be possible – and infrequently done in a time of 10% unemployment because of good policy designed to promote wealth sufficient to keep all the members of this countries strata alive.
http://www.skyscrapercity.com/...
http://www.theinformationcompany.net...
http://www.voxeu.org/...
I doubt the policy makers responsible for President Obama's under performing job policy will be replaced soon as they should. They have to be ignored. We must create policies that aid consumers first and so because of the consumers increased spending and his productive infrastructure building then business will expand. Mr Summers and Mr Geithner seem incapable of making plans that help consumers first.
It's very simple. The buisness tax cuts won't work till we do something else first. The state band aids won't solve the problem of even states for long. The way for the federal government to put America back to work best is to start directly letting contracts for bid to build those hydrogen plants or begin some other project with both large numbers of employees and with great benefits in its lasting infrastructure to buisness and consumers.