Mustering Up Enthusiasm For This Big Adventure
by ahansen
What has happened to the markets –or so we’re being told– is a recession; which, they say, has bottomed and is on its way to a slow recovery. But what has happened to We the People—those of us folks out here on the ground where the green shoots are supposed to be — is Depression with a capital D. And I don’t mean the financial one.
As any number of us un and under-employed here on the blog can tell you, being jobless is no picnic—especially when you’re facing a hugely uncertain future and trying to figure out how to care for yourself and your family. Being out of work when you need it is scary, and humiliating, and soul-numbing, and it’s becoming increasingly more prevalent among people who never thought it could happen to them– doctors, lawyers professors, and rocket scientists included.
With no job, no income, and rapidly dwindling assets, it’s no wonder there’s currently a two-to-six month waiting list for admittance into in-patient psychiatric facilities. (And that’s just for those with gold-plated medical insurance and still-intact investment funds.) Many more of us are living on the edge of despair, clutching at the faint hope that somehow, soon, all of this will turn around and things will get back to “normal.” But despite what we’re hearing from the federal cheerleaders, to all but the most gullible, that turnaround and all the new jobs promises, appears less likely with each chirpy proclamation.
Washington and the Titans of the G20 may go on, secure in the knowledge that their system will continue; with bailouts as necessary and their currencies intact. But for those of us left to clean up the results of their gross mismanagement and outright corruption, the realization that our rosy expectations and our hard-earned paychecks have both careened into a dead end brick wall is a nasty shock —and one from which many of us will never fully recover. We know viscerally that what we are experiencing is unprecedented in our lifetimes; that we are living an historic moment. But it is hard to muster up much enthusiasm for this big adventure when all we see around us is carnage.
John Mauldin offers an exceptional analysis of current Bureau of Labor Statistics in this week’s “Welcome to the New Normal,”
Among his conclusions are these tidbits:
“…And if you add… (to the standard unemployed and marginally attached workers who comprise the data,)… those who are employed part-time for economic reasons (i.e., they can’t get full-time jobs) the unemployment number rises to 16.8%.”
Note: Great Depression era statistics defined “unemployed” as anyone over the age of 16 not engaged in “full-time” work— rendering those 25% unemployment figures we’re all familiar with not quite so impressive when compared what we’re experiencing now in California, Ohio, etc.
And…
“…If you take the average job growth from 1989 until now, you get an average of 91,000 a month. If you take the best ten years I could find, which would be 1991-2000, the average is still only 150,000. That is a long way from 250,000… (new job creation per month we now need to get back to a 5% unemployment rate.”)
Note: (Per month job loss for 2009-to-date averages 481,000.)
The implication is that while we may see a structural economic recovery for a time, the reality for many of us is Hard Times Ahead for the foreseeable future.
Without strong employment, the best economic system in the world is useless. And the longer the numbers keep dropping, the harder it will be to pull ourselves out of the slump. As more and more people become unemployed, more and more businesses will fail from lack of consumer support, which of course leads to more unemployment….
The Great Depression weighed disproportionately upon the low-level industrial and farming classes. Today the one-two punch of unemployment and ever-rising layers of taxation, —overt and hidden— is hitting the suburban white collar and skilled labor demographic the hardest. Given the rapidly dwindling middle class, the secondary recession that will inevitably follow this temporary recovery may be more far reaching than even the most pessimistic of us here might wish to contemplate.
When Hoover was in office, Congress passed the Reconstruction Finance Bill to bail out the banks, the insurance companies, and the railroads. Today we have the Troubled “Assets” Relief Program to bail out the banks, the insurance companies and the housing industry. Both attempts to save American capitalism may come to similar ends if the current recovery is thwarted by ever-rising unemployment feeding upon itself.
Viable solutions to this dilemma are myriad and complex, but in one form or another they will have to involve putting Americans back to work in some constructive (if income diminished) capacity. Complicating the issue is the huge number of Baby Boomers aged 55+ who find they can no longer afford to retire and must remain in jobs that would typically go to the upcoming generation of younger workers. Paradoxically, until this older demographic begins to leave the marketplace en masse, full employment is unlikely.
One solution might be to incentivize two negative elements of our economy to create one positive one. The vast number of empty condos and housing tracts now essentially owned by the government (Fannie/Freddy/bank bailouts,) can be structurally modified (thus creating jobs,) and repurposed into multi-unit Section 8-like “projects” for housing the huge number of newly-impoverished suburbanites about to hit retirement age. In exchange for say, giving up their Social Security income, or a state or local government pension, retirees would be guaranteed a place to live out their days in relative comfort and security, with food services, health care, transportation, recreation etc. on site or clustered nearby. Millions of new service jobs would be created to staff these projects, and active seniors could be employed in providing daycare, light assembly work, staff assistance, consultancy etc. to the communities that they live in.
By clustering the housing, resources, equipment, and services in one place, needless duplication could be avoided, and the cost savings better utilized elsewhere—for example; subsidized taxis, on-call medical personnel, social and food services, community gardens, recreational and educational facilities, and family centers. When the Boomers go bye-bye, the projects can be turned into dorms for the kids doing their mandatory 2 years of national service. Or low-cost housing for migrant immigrant labor and struggling artists— or whatever Orwellian social construct is necessary in 2050.
That’s just one idea. I’m sure as a country of the soon-to-be chronic unemployed we can come up with lots more—maybe even a few that address some of the serious problems besetting us. I mean, Hey, as long as we’re not doing anything useful for awhile….
The last time we had a Great Depression, it took a World War to pull us out of it. Let’s hope that what’s created this time will turn out to be a war against unsustainable economic models, against an increasingly unlivable global environment, and against the impoverishment of mind, body and spirit spawned by those selfsame failed systems.
At least until we can all get back to work.
