If you missed the news this week, a leading group of economists announced that the recession is over. At least on paper. Although a survey by the National Association for Business Economics found that 80 percent of economists say the recession is over, few of those economists believe a recovery is right around the corner.
The most optimistic predictions say the true signs of a rebound are still months away. The Wall Street Journal reported Tuesday that although stocks shot up due to higher-than-expected profits, many companies raised their profits by cutting staff and operations. The Journal reported that few companies expect to hire people back or expand production in the next year, meaning there is little hope of an immediate recovery.
This is particularly bad news for people out of work. The national unemployment rate is 9.8 percent, up nearly four percentage points from the same time last year. Economists expect unemployment to rise to 10 percent early next year before starting to fall. In Nevada, the unemployment rate in August was a record 13.2 percent, the second-highest in the nation.
Even those numbers don’t reflect the full effect of the economic downturn. The federal Bureau of Labor Statistics doesn’t include people who say they have quit looking for work or people whose hours have been cut back and are underemployed.
At the end of last year and the beginning of this year, there was a great rush in Congress to find ways to stimulate the economy. Without the swift government action by the Democratic-led Congress and President Barack Obama, over bitter Republican opposition, the nation’s economy would be much worse than it is now, not anywhere close to emerging from a recession.
The president and Congress lately have been consumed by the much-needed legislation to overhaul the nation’s health care system, and although that legislation is important, more attention must be devoted to repairing the economy.
Because of the severity of the economic downturn, Congress should consider a broad view of options. Robert Reich, the labor secretary under President Bill Clinton, told The New York Times’ Bob Herbert he would consider tax incentives for small businesses that create new jobs. He was careful to add that the incentives should not reward companies for employing people they would have hired anyway.
Other experts are proposing greater federal aid to states to help them pump money into highway construction and other infrastructure projects.
Those ideas are just two examples of what needs to be on the table. No matter what it does, Washington needs to move speedily to find ways to stimulate the economy and create more jobs.
Join the Discussion:
Check this out for a full explanation of our conversion to the LiveFyre commenting system and instructions on how to sign up for an account.
Full comments policy