As Americans prepare to celebrate the 4th of July it’s worth asking, are you better off than you were two years ago when Democrats took over Congress? Are you better off than you were six months ago? If not, then consider what you have to look forward to for the next couple of years.
The Democrats in Congress and the Obama administration promised a peak unemployment of 8% if the stimulus legislation was passed. Now that that unemployment has blown through 9.4% in less than five months after its passage voters should think hard about some other unemployment data that paints a much more depressing picture of the U S economy. Those Americans that are employed are working on average 33 hours per week. As the Wall Street Journal notes, that’s the lowest level in 40 years:
Average hours worked per week dropped to 33, the lowest level in at least 40 years. This means that millions of full-time workers are being downgraded to part-time, as businesses slash labor costs to remain above water. Because people are working less, wages have fallen by 0.3% this year. Factories are operating at only 65% capacity, while the overall jobless rate hit 9.5%. Throw in discouraged workers who want full-time work, and the labor underutilization rate climbed to 16.5%.
So what does Congress have on deck to address this underemployment and unemployment? A minimum wage hike from $6.55 an hour to $7.25 an hour. As real wages in the private sector are falling the government is mandating higher wages to accomplish what? Higher employment? Hardly. An increase in the minimum wage will exacerbate the already contracting market for jobs as employers continue to squeeze out cost savings in a shrinking economy.
Asked about the surprise surge in unemployment Thursday, President Obama had this to say:
“If we’re weatherizing every building and home in America, if we are creating windmills and solar panels and biofuel facilities, that is a huge promising area not only for jobs here in the United States, but also for export growth.”
That answer is on par with his “tune up” advice for car drivers last year when gas prices spiked. Has there ever been a more disengaged, clueless Executive on the matter of economic and fiscal policy? The answer is no because this president has set himself apart from the rest by advocating a massive energy usage tax (Cap and Trade),a massive health care tax, increased taxes on small business, and mandatory wage hikes on small business…..all in the first six months of office, all in the midst of the worst recession in forty years.
As the Journal editors correctly note, “a sustained expansion and job creation must come from private investment and risk-taking”. There is nothing in President Obama’s policy that encourages risk taking. In fact, there is much about the President’s policy that encourages risk avoidance and tax avoidance, both of which behaviors are anathema to private sector growth. Democrats in control of both Congress and the Presidency offer little real hope and change for the unemployed. In light of the legislative milestones of the past six months Republicans need to exploit the gift their opponents are serving up to them: every unemployed and underemployed person is a swing vote worth fighting for.
