The Obama administration "has now abandoned the idea of promoting full employment."

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Thu Jan-27-11 03:18 PM
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The Obama administration "has now abandoned the idea of promoting full employment."

The New American Caste System
By: David Dayen
January 26, 2011

The White House is generally pretty pleased with what they�ve done, they don�t think they�re likely to get anything additional from Congress � which they�re right about, but that assumes that the executive branch has no authority of its own � and they�re going to just engage in happy, sunny, Reagan-esque optimistic talk and hope the economy comes back on its own. There are some things � like a new budget � that must be done, and there we shall see where talk meets action. But basically, the White House is done, and they�re quite happy with their efforts. If you want to be real charitable, they think it�s the best they can do.

Indeed, you have a President responding to a Congressional majority that thinks deficit reduction on its own will somehow spur �confidence� and create growth. That�s the twisted world of Washington these days. So I don�t want to paint the White House�s apparent belief that they�re at the end of the road on job-creating legislative options as wrong. No, it�s right, and they bear at least some responsibility for that, given 2009-10 governmental performance. But their reaction to this crisis is to pretend it no longer exists.

And with that, I think we can close the curtain on liberal � or even centrist, really � governance, and take a long intermission. Government has now abandoned the idea of promoting full employment. If people can walk to work in Washington without wanting to endlessly apologize for the failure of 15 million unemployed citizens, then that part of New Deal liberalism has ended. Government no longer tries to level the playing field between labor and management, not through regulation or through working to tighten the labor market.

As a result you have essentially a corporate-driven state. They hold all the power in Washington, and basically, it�s purchasing power. And their conception of what works for economic growth dovetails with extreme income inequality, the kind that causes financial crises. New Gilded Age might be too mild a term for what we�re experiencing.

Read the full article at:

http://news.firedoglake.com/2011/01/26/the-new-american-caste-system/

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And remember what President Obama said last September: "I've never believed that government's role is to create jobs or prosperity"

(Excerpt)

The White House
Office of the Press Secretary

For Immediate Release September 08, 2010
Remarks by the President on the Economy in Parma, Ohio
Cuyahoga Community College West Campus, Parma, Ohio

"Now, we have a different vision for the future. See, I�ve never believed that government has all the answers to our problems. I�ve never believed that government�s role is to create jobs or prosperity. I believe it�s the drive and the ingenuity of our entrepreneurs, our small businesses; the skill and dedication of our workers -- (applause) -- that�s made us the wealthiest nation on Earth. (Applause.) I believe it�s the private sector that must be the main engine for our recovery.

I believe government should be lean; government should be efficient. I believe government should leave people free to make the choices they think are best for themselves and their families, so long as those choices don�t hurt others. (Applause.)"

http://www.whitehouse.gov/the-press-office/2010/09/08/remarks-president-economy-parma-ohio

Now I understand why the Obama Administration won't lift President Reagan's ban prohibiting direct WPA type federal jobs programs. And that's why President Obama failed to present a bold government program to jump start the economy and bring to an end this Great Recession. President Obama believes it's not the governments role to lead this nation out of the Great Recession. President Obama's "lean government" stays out of the way and lets Wall Street and corporate America (entrepreneurs) perform their magic.

Some magic.

Well, they did make almost 10 million jobs disappear.

Excerpts from two articles by Alec MacGillis -

By Alec MacGillis
Washington Post Staff Writer
Sunday, November 8, 2009 and
Monday, November 9, 2009

Why has a White House that talks so much about boosting employment steered clear of the most direct strategy that could keep Americans on the job? .... aside from a small summer employment program for young people, it has not sought to create jobs on the public payroll, something the country did in the 1930s and 1970s.

President Richard Nixon gave jobs programs another go in the doldrums of 1973-74 with the Comprehensive Employment and Training Act (CETA).

The program withered under President Ronald Reagan, who added prohibitions against public service employment (except for summer programs and natural disasters) that endure today. That the Obama administration shows little indication of lifting this taboo is a sign of how free-market tenets persist even when financial turmoil has called them into doubt, said John Russo, co-director of Youngstown State University's Center for Working-Class Studies.

As for direct job creation: there's a real nervousness about setting up anything that looks like a WPA-style jobs program. It's that reluctance that my piece is calling into question -- after all, is it really more politically damaging to be seen as doing a jobs program than to be facing double-digit unemployment?

.... we had direct job creation programs in place throughout the '70s, as my article recounts. It was called CETA, and it ramped up under Nixon in '73-'74 recession. Reagan ended the program, and implemented a new federal restriction against federal jobs programs, with exception for summer youth programs and national emergencies.

The Labor Department does have various job training programs in place, such as Job Corps. But the federal government is prohibited against doing direct jobs-program style hiring a ban that Reagan put in place and that the Democrats so far have balked at trying to lift.

http://www.washingtonpost.com/wp-dyn/content/article/2009/11/06/AR2009110601900.html?sid=ST2009110604712

http://www.washingtonpost.com/wp-dyn/content/discussion/2009/11/06/DI2009110603214.html