Rising unemployment will result from more than just trouble in private industry, and that could help push the jobless rate closer to 10% as the year passes. States and municipalities are working harder and harder to cut their work forces, or at least curtail their work hours and benefits.
According to the AP, "Unions argue their members shouldn't be singled out and are even more vital in hard times -- securing neighborhoods and prisons, educating children and providing social services to growing numbers of citizens." That may be accurate, but states running huge deficits will grasp at any life preserver they can find.
The problem raises the subject of how the $825 billion stimulus package can be be used. Putting it into infrastructure projects may work, but that will take time. Building out roads, the energy grid, and broadband systems can require months of planning. Those are months the economy does not have.
Putting money directly into state treasuries has a nearly immediate positive impact. Tens of thousands of workers in places from California to Michigan could keep their jobs. It may not create new employment, but is certainly keeps joblessness from spiking higher.
Douglas A. McIntyre is an editor at 247wallst.com.
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Reader Comments (Page 1 of 1)
1-24-2009 @ 11:26AM
sgentilejr said...
The US economy is in Critical Condition and of Life-Support. We can give one transfusion after another by pumping more and more money into the banks, but the bleeding must be curtailed for the patient to survive. The bleeding is caused by Importing (buying) more products than we produce (& export)
Only YOU can help to stop the bleeding before the patient dies___by buying only American made products. Every imported products you buy, regardless of how smal or inexpensive is another drop of blood dripping out of the patient (our economy)
Survival is entirely in YOUR hands. Buy American ONLY and if you cannot find what you need made in the USA___don't buy it and find another substitute, because the more money YOU send out of the USA, the faster we bleed to death.
1-24-2009 @ 12:14PM
Annie said...
Would you open a manufacturing plant in El Paso, TX , pay union wages, sick leave days, holidays, vacation time, retirement, medical care, local, state, federal taxes and deal with environmental concerns, when you can move two miles across the border into MX and erase all these expenditures and pay low wages. Trade deals in our hemisphere make it easier for American manufacturing to move abroad and bring back goods made in whatever foreign country they went to without duties. The middle column of the tariff schedule, implemented in the 1970s has done nothing but undermined American workers and reduced the taxes that they once sent to the government to pay for infrastructure, etc. Its time for the Congress of the United States to look at the damages they made by incorporating that middle column. One week after NAFTA Canada initiated the 8% goods and services tax at the cash registers, country wide, plus the provincial taxes, we escaped taxes at the border and then got slammed in the stores.