Economy Is Still In The Dump

At the risk of sounding like a broken record, I have to say the economy of this country is still in terrible shape. The pundits can say whatever they want about an increase in GDP ending the recession, but any increase in income or productivity has helped only the rich. For the rest of America the recession still rages on. Wages are stagnant, housing prices are in the basement, foreclosures remain at record levels, and unemployment remains extremely high.

The Labor Department has released its figures for June, and they are not good. Only about 18,000 jobs were created in the whole country last month (and if the last few months are an indicator even that low figure will be adjusted downward). Since it takes the creation of nearly 200,000 jobs just to keep up with the number of new workers entering the job market, that means the job situation got worse in this country again last month. This is verified by the fact that the number of unemployed people who have been out of work less than 5 weeks grew by 412,000 in June.

According to the government statistics, there current size of the labor force stands at 153.4 million people. But 14.1 million people were listed by the federal government as unemployed, putting the official unemployment rate at 9.2% -- a rate that is rising, not falling. And when you add in the 8.6 million involuntary part-time workers and the 2.7 million "marginally-attached workers (who are not counted because they haven't looked for work in the last 4 weeks), the real unemployment/underemployment rate is around 17%. And that is probably a lowball figure since the marginally-attached are very hard to count.

Both the Democrats and Republicans talk about job creation, but neither party has done anything to attack the high unemployment in the United States. Instead, they are engaged in an argument over how much to cut government spending -- an action that will only exacerbate the unemployment situation. If the government budget must be cut in a time of high unemployment like this, it should be done by raising the taxes on corporations and rich who are making record profits. Cutting government spending on social programs just contracts the economy and makes unemployment worse.

Nobel Prize-winning economist Paul Krugman puts it this way, "The situation cries out for aggressively expansionary monetary and fiscal policy. Instead, however, all the political push is in the opposite direction."

I'm afraid we're going to have to put up with the current unemployment and terrible economy for a lot longer though. There are very few politicians in Washington who seem to care anything about what is happening to the American people. They are far too busy arguing over how much more money they should give to rich people and corporations.