Mitch McConnell said this week that America has lost 1.5 million jobs since the first stimulus bill was passed. That is not true.
A little over a month ago, this nation began a long overdue discussion about jobs and the crisis of unemployment for the first time in over two years. But since we have to have this discussion with people with no aversion to just making stuff up, we would be wise to bone up. Some stuff has changed in the last two and a half years.
Lets start with how many people are working now compared to when President Obama was inaugurated.
These two horrible looking dips are actually seasonal variation since this particular graph isn't seasonally adjusted. A lot more people work in the summer than in the winter. But looking at those summers, there were within a few hundred thousand fewer people working last summer than the summer of 2009. And unlike both previous summers, the number of people working has continued to increase into the fall. That won't last, but it is a good sign.
Where you see disaster is not in what has happened during Obama's time in office. The disaster is what happened before he got there.
The January of Obama's inauguration employed over 4 million fewer people than the one before. The summer employment growth was diminished by continuing job losses, and the winter thinning was exasperated by them, but what you see overall in this picture is a leveling out. As the stimulus money and the Fed's quantitative easing programs started to get into the economy, it stopped the arterial bleeding. The situation stopped getting worse.
What it did not do, and what progressive economists like Paul Krugman said at the time that it would not do, was replace the jobs that had already been lost. Mitch McConnell's cynically worded objections to the contrary, the $760 billion stimulus did what it was supposed to do. Unemployment is 9.1% now, but it would be over 11% if the stimulus had not been done.
In line with that, the President's $400 plus billion jobs package is forecast to bring down unemployment by 1%. To bring unemployment down by 2% more, using fiscal policy, would probably require another trillion dollars in stimulus beyond the President's proposal.
Of course, there is so little chance of Republicans going with a plan that would put so many people back to work and reduce their electoral chances next November, President Obama won't even suggest it.
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