The president’s message was simple enough, but just to make sure that it reached the 535 members of Congress sitting before him he repeated it more than seventeen times: his bumper-sticker ready message, “Pass this bill now.” That bill was the American Jobs Act, the president’s $447 billion stimulative response to anemic job growth that he outlined before a joint session of Congress in early September. To many, President Obama was finally standing up to Republicans and demanding substantive action to jumpstart a lagging economic recovery, instead of continuing distracting arguments about debt and deficits. Unfortunately his repeated reproaches have proven not to be enough as House Majority Leader Eric Cantor announced yesterday that the American Jobs Bill, as a package, is dead.
As of now the only path to passing the measures prescribed in the bill is piecemeal; among its components are $240 billion for the extension and expansion of payroll tax cuts and $140 billion for modernizing schools and repairing roads and bridges. However in addressing the dismantling of the bill, Cantor listed few things that both parties agreed on and offered no details on which parts of the bill would soon make it to the House floor. Overall the House Republican message was a rebuke of President Obama’s economic centerpiece and just another example of the increasingly impossible and dysfunctional manner in which our government operates.
What’s truly incomprehensible is that Republicans’ refusal to act on jobs comes in the wake of Federal Reserve chairman Ben Bernanke explaining that long term unemployment is a “national crisis.” An unprecedented 45 percent of Americans have now been unemployed for more than six months, the highest amount since WWII. Not to mention the never ending series of other dismal numbers: an unemployment rate that stays above nine percent, a growth rate barely above one percent and so much more. Over and over economic experts, including those whose job is to lower unemployment (Hello, Federal Reserve) have said that a lack of demand lies at the center of our current economic turmoil, meaning that stimulating demand is key to solving this problem. And how does one do that? By funding infrastructure projects, which in turn create jobs, or by lowering payroll taxes so we can all spend more.
Republicans, though, have yet to accede to the political and economic reality. While aware of the current economic slowdown, they seem confused as to the causes of the downfall, and by extension how to combat it. Most recently, Republicans have come to embrace the fallacy that government regulation is the principle factor holding back employment, due mostly to the new regulations imposed by the Obama administration. Even though there is no evidence supporting this claim, Majority Leader Cantor still advised members of the House Republican Conference to make repeal of job destroying regulation a key element of the Republican jobs agenda. In actuality, research done by the Bureau of Labor Statistics on mass layouts in 2007 showed that a lack of demand was a much more common and important reason for layoffs than government regulation or intervention.
But apparently the facts don’t matter. The fact that the nation is undergoing an economic “national crisis” doesn’t seem to matter, and neither does the fact the American Jobs Act is the kind of stimulus required at a time like this. If Friday’s September jobs report reveals further economic stagnation, will the Republicans finally face the facts?
Photo via whitehouse.gov