Kai Ryssdal: Part of what we’re talking about today and all week is what happens when the labor market is as lousy as the American labor market is. One thing could be that lousy becomes the “new normal,” and that doesn’t sit well at all with commentator Robert Reich.
Robert Reich: Even if we produce new jobs at the best rate we’ve achieved this past decade, we wouldn’t get back to 6 percent unemployment — the old normal — until 2024.
And if job growth stays as anemic as it’s been for the last few months we won’t get back there for a generation. Some say 9 percent is the “new normal” because Americans have priced themselves out of the global high-tech labor force. They say we won’t get jobs back again until real wages drop 20 percent.
But there’s no reason the inhabitants of the richest and most productive nation in the world must be condemned to high employment or low wages.
This can’t be the new normal because it’s not sustainable economically. A population suffering years of joblessness or low wages won’t be able to buy what the economy could otherwise produce. That means a downward vicious cycle toward even higher unemployment and lower wages.
And it’s not sustainable politically because Americans won’t stand for it. One way or another they’ll demand change — at the ballot box or even, eventually, in the streets. We’ll elect reformers who will bring back jobs and wages. Or demagogues who scapegoat immigrants, foreign nations, the poor, unions, religious minorities, even government itself. And that would mean another downward vicious cycle.
That’s why the stakes are so high, and why the president must be bold when he issues a jobs plan tomorrow. A new WPA and Civilian Conservation Corps, a half-billion dollars of infrastructure spending, loans to cash-starved states, a plan for government to buy up mortgage debt in exchange for equity stakes when homes are eventually sold.
If Republicans won’t go along, take it to the people. Make it the centerpiece of the 2012 campaign. America needs bold leadership now. A so-called new normal of lost jobs and lower wages isn’t normal at all.
Ryssdal: Robert Reich was secretary of labor for President Clinton. His most recent book is called “Aftershock: The Next Economy and America’s Future.” Next week, David Frum. Send us your thoughts — write to us.
There’s a lot happening in the world. Through it all, Marketplace is here for you.
You rely on Marketplace to break down the world’s events and tell you how it affects you in a fact-based, approachable way. We rely on your financial support to keep making that possible.
Your donation today powers the independent journalism that you rely on. For just $5/month, you can help sustain Marketplace so we can keep reporting on the things that matter to you.
