The Labor Department released its monthly jobs report today, and the picture was quickly muddled by Democratic and Republican pandering in an election year that is almost exclusively focusing on economic recovery. According to the report private employers added only 120,000 jobs to the economy in March, a disappointing number according to most analysts compared with the previous two months each of which added almost twice that number. Despite this slowing of the pace of hiring the unemployment rate dropped slightly from 8.3 to 8.2 percent.
However, the unemployment rate comes from a separate survey of households rather than employers and indicates that a lower portion of the population were looking for work rather than indicating more workers being added to the economy. Therefore, it is almost useless to look to the unemployment rate as a significant determinant of economic recovery without adding the caveat that fewer people looking for work does not strong job growth make.
The economic picture is further clouded by election year politics in which both parties seem to do little else but blame the other party for “failed economic policies.” In a speech this morning at the White House conference on “Women and the Economy,” President Obama acknowledged the difficulties posed by anemic job growth, calling the report worrying but stressing that the unemployment rate continues to decline (albeit, slowly). The President did not mention other disappointing news identified in the report. For example, fewer than half the persons in recent months added to payrolls, or that the drop in unemployment reflected the fact that more people had dropped out of the labor force.
The Republican front-runner, Mitt Romney, wasted no time in blaming the President personally for economic forces put in motion long before Obama’s election and far beyond his executive powers to change. “Millions of Americans are paying a high price for President Obama’s economic policies, and more and more people are growing so discouraged that they are dropping out of the labor market altogether,” Mr. Romney said.
To be fair, millions of Americans have been dropping out of the labor market over the last twenty years as a permissive regulatory environment, corporate tax loopholes, and other factors such as technological innovation encouraged American companies to move jobs and profits overseas. Yet, Mr. Romney has virtually nothing to say to his peers who are truly responsible for the economic malaise of the country.
Congressional leaders proved no better in offering Americans either a correct diagnosis or reasonable policies for extricating Americans from this malaise. House Speaker John A. Boehner said, “Today’s report shows that families and small businesses are still struggling to get by because of President Obama’s failed economic policies.” Surely, Mr. Boehner means that families and small business are struggling from an economic collapse precipitated by his party’s commitment to crony-style capitalism under eight years of Bush the Younger’s reign.
Politically speaking, the problem with the economy is that no one is willing to tell it like it is. After more than two decades of Republican-style economics, supported more or less by the Democratic Party and its ties to corporate America as well, Americans are neither getting the truth of the matter nor making much progress. Income inequality, poverty, the uninsured are at their highest levels since the Great Depression. Then again, so are profits margins and executive compensation as American corporations sit on mountains of cash they have expropriated from workers, consumers, and investors alike.
The conjunction of these two facts—deepening inequality and corporate greed—are the two largest road blocks standing in the way of economic recovery. Until politicians do their job, and some of this reserve is redistributed in the form of more hiring, rising wages, and pension and health care reform, there is little hope either of addressing this country’s many economic problems or escaping its self-inflicted malaise.