Friday, 03 June 2011

Jobs Numbers Stagnate: Has Obama's Spending Killed the Recovery?

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The U.S. economy experienced disappointing jobs numbers in May, according to figures released June 3 by the U.S. Bureau of Labor Statistics (BLS), leaving the unemployment rate at 9.1 percent at the end of the month.

The BLS reported that "Total nonfarm payroll employment was little changed in May (+54,000), following gains that averaged 220,000 in the prior 3 months. Private-sector employment continued to trend up (+83,000), although by a much smaller amount than the average for the prior 3 months (+244,000)." The U.S. economy has to add close to 200,000 jobs per month just to keep up with the increase in population, so the figures represent upward pressure on the unemployment rate.

The jobs numbers echoed the lackluster economic performance in recent months. Most recoveries from recessions in the post-World II era included several years of robust four-percent growth or better, and President Obama's budget proposal includes assumptions of much faster economic growth than the nation is experiencing. The current recovery has been stuck in the one- to three-percent growth in gross domestic product.

Republican presidential candidates blamed President Obama's spending policies, particularly his stimulus spending, for the lack of an economic recovery. Republican presidential candidate Ron Paul's campaign issued a blistering press release in anticipation of the disappointing jobs numbers. "If the latest job numbers are any further indication, none of the centralized schemes deployed by Washington’s elites are helping regular Americans. As a matter of fact, Barack Obama and the big government crowd are destroying our economy, and our dollar,” Jesse Benton, Ron Paul's campaign chairman, said in a press release, adding:

Despite the fact that none of the past nearly trillion-dollar economic stimuli have worked, all signs point to the Federal Reserve gearing up for another round of "quantitative easing" — meaning more destruction of the already-weakened dollar. At the same time, we have an official Washington that refuses to acknowledge the looming fiscal crisis our country faces with regards to our debt and continues to spend with no end in sight. We are going to see real suffering in this country if we do not balance our budget and restore sound monetary policy. And we need to do it now.

Republican presidential candidate Mitt Romney also anticipated the disappointing jobs numbers. "Barack Obama has failed America," he said in his speech that made his candidacy official June 2. "When he took office, the economy was in recession. He made it worse. And he made it last longer. Three years later, over 16 million Americans are out of work or have just quit looking. Millions more are underemployed. Three years later, unemployment is still above 8%, a figure he said his stimulus would keep from happening. Three years later, foreclosures are still at record levels. Three years later the prices of homes continue to fall. Three years later, our national debt has grown nearly as large as our entire economy. Families are buried under higher prices for food and higher prices for gasoline. It breaks my heart to see what’s happening in this country."