A GOP face of increased unemployment & economic ruin

The U.S. economy is adding jobs, if slowly, but state and local governments cut 30,000 jobs in May, the seventh straight month they've shed workers. Rather than adding to U.S. economic growth, this time they're subtracting from it.



And people are feeling it-- from reduced services to fewer teachers, police officers and firefighters. Few see the pain subsiding soon.



Mark Vitner, senior economist at Wells Fargo Securities, expects state and local governments to slash 20,000 to 30,000 jobs a month through mid-2012.



Joel Naroff of Naroff Economic Advisors notes that when states cut spending, a ripple effect multiplies the damage: Companies that do business with states and localities suffer. These companies, in turn, scale back their hiring.



"There's a whole slew of private companies that have to cut back when they don't get the [government] contracts they had been getting," Naroff said. "You can't balance a budget and say everything's going to be beautiful."



Moody's Analytics estimates that each job in state and local government supports an additional 1.3 jobs elsewhere.

[I]t is not wise to toy with a significant source of American power. America enjoys the unique privilege of having its currency act as the world's reserve. Every political circus act on the debt gives ammunition to those (often from emerging powers like China and Brazil) who are calling for the world to become less reliant on the dollar, and eventually to replace it with another reserve currency. While there is, at present, no attractive alternative, and some economists think a switch to another currency would be a net positive for the U.S. as it would force us to live within our means, such a move would take away advantages Americans have long grown accustomed to, and the transition would likely be very, very painful. And, more immediately, some analysts predict that a failure to increase the debt ceiling could send the U.S. back into a recession.

James Carville took his incoherent, gloomy messaging to Don Imus' radio show and was probably mindful that it is simulcast on Fox, when he announced that Obama's reelection effort could be "very rough" if job growth remains anemic. You think? I guess he chose to ignore the White House line that the 54,000 jobs created in May was an anomaly and that the thing to emphasize was the 2,000,000 jobs created this year. "If 54,000 new jobs is the new standard, it's going to be a very, very rough 2012 for President Obama," brayed Carville. "I can't tell you what's going to happen, but if this last jobs number is an indication of future jobs numbers, it's going to be very, very rough."Actually 83,000 jobs were created; the net job creation number was so much less because Republicans in control of state governments are firing public employees as fast as the private sector can create new jobs. And by the private sector, primarily small businesses. Big business is sitting on billions of dollars in cash, distributing some to shareholders and huge amounts to upper-level management but not creating any jobs at all. And governors like Scott Walker, Rick Scott, Rick Snyder, Paul LePage, Chris Christie, John Kasich, etc are lay-off machines... all doing their bit to drive up the unemployment figures drastically.The Republican hostage takers threatening to tank the economy entirely and send the U.S. into a Depression by refusing the raise the debt ceiling, have added two new demands. One doesn't sound like a completely terrible idea: a bi-annual rather than an annual budget , which limits the power of corrupt congressional appropriations chiefs like Hal Rogers and Jerry Lewis (a good thing). And now they're demanding that the federal government lay off another 10% of its workforce , a demand guaranteed to push the country into a depression. This one is being led by 3 right-wing extremists, Darrell Issa (R-CA), Dennis Ross (R-FL) and Jason Chaffetz (R-UT) with their bill, HR 2114.And what happens if Democrats don't give in to the hostage-takers and the Republicans actually go ahead-- as many of the most extreme of them have already vowed to do-- and refuse to raise the debt ceiling? Nina Hachigian at the Center for America Progress laid it out in a pretty straight forward way. "American power and world economic stability," she states flatly, "are at stake."Oh yeah, that too. Could it really happen? Wall Street golden boy Paul Ryan may be a little tarnished but right-wing Beltway pundits still consider him "serious" and even "courageous." Many Republican Members of Congress no longer trust him-- he helped Boehner trick them into voting for Bush's TARP bailouts and he made all of them walk the plank on his insane kill-Medicare-budget. But now he says he's "serious" about not raising the debt ceiling unless the Republicans get exactly the untenable budget cuts they are demanding, though he earlier admitted that a government default was "unworkable." Time for the GOP to stop posturing and start treating the deby ceiling with the gravity it demands.

Labels: Darrell Issa, debt ceiling, obstructionist Republicans, Paul Ryan, unemployment