Across America 15 million Americans are still out of work and unable to find jobs. The latest numbers from the Labor Department indicate that only 41,000 private sector jobs were created last month. Of the 431,000 new jobs added in May, 411,000 were temporary census workers hired by the government. Despite Obama’s assertion, made just days ago, that “the economy is improving and that the economic stimulus legislation passed a year ago was having a positive effect” there is little to cheer about. The president’s unrealistic predictions that “the economy is poised to start adding the jobs people need” were clearly misguided and off the mark.
These are predictable results given how aggressive this administration and the Democrat controlled Congress have been in promoting socialist policies that stifle economic activity and unreasonably punish responsible corporations and businesses. Just last week I wrote: “Company owners, entrepreneurs, and businesses remain in defensive mode. They see the dangers ahead and are not hiring. Can anyone blame them?” The employment results just released confirm that private companies are not hiring and remain extremely cautious in the face of an unstable economic situation and wrongheaded financial policies perpetuated by our own government.
According to Ed Morrissey on Hot Air, the economy needs to create at least 100,000 new private sector jobs every month just to keep pace with the normal US population growth. This level of growth wouldn’t even address the millions of jobs lost since the recession began. Yet, this May job growth was less than half of that. This represents a 75% drop from the previous month’s growth and “puts the US back in a net job loss situation.” We are heading in the wrong direction.
On Friday, CNBC summarized the problematic and dangerous situation the US economy still faces:
The private sector added just 41,000 jobs: Manufacturing, temporary help and mining added jobs, while construction declined. That number was also well short of the more than 500,000 economists had expected. The unemployment rate, however, fell to 9.7 percent from 9.9 percent in April.
“This number is extremely disappointing,” said Todd Schoenberger, managing director at LandColt trading. However, he said, it should come as no surprise. “Considering first time jobless claims have been inching higher over the past four weeks … and GDP came in at a lackluster 3%, American companies are going to be reluctant to hire.”
“The two areas of potential vulnerability for the economy remain payrolls and housing and they’re both staggering a good deal,” Art Cashin, director of floor operations at UBS, said on CNBC this morning.
For anyone with eyes to see and ears to hear the economic reality faced by US companies has not improved much and continues to operate in perilous conditions. What was true back in July 2009 continues to be true today: “As far as the eye can see President Obama and the Democrats are preparing to implement multiple significant tax increases, layer upon layer of new government regulations and restrictions on business activities, and massive and wasteful government borrowing and spending for at least the next decade. There is nothing coming out of this White House that would signal to American businesses that it is willing to change course and let the private sector – the only real engine of value and job creation in a free-market economy – do its job and bring our country out of this recession.”
The unemployment numbers indicate exactly what many experts have been predicting for months. Companies do not trust the punitive and anti-growth schemes the government keeps forcing on the American marketplace and the private sector. Responsible business owners and corporate executive understand these policies have never worked before and will not work to restore a country’s economic and financial stability. Ed Lasky on the American Thinker Blog explains:
Maybe if Barack Obama and the Democrats would enact pro-growth measures and stop demonizing private enterprise, stop erecting a regulatory regime that strangles business, abolish their healthcare reform bill that will add hundreds of billions of dollars to our deficit, stop taxing us to penury, stop rewarding union allies at the expense of entrepreneurs, maybe… maybe we might get the engines of our economy moving again.
The cap-and-tax bill won’t help matters as businesses contemplate the steep rise in energy costs facing them if that monstrosity comes to pass. These sorts of schemes have helped sink the European economies, the California economy — and economies around the world who are now engaged in crash programs to tend them (see Spain’s about-face).
Reality is beginning to sink in on Wall Street. On Friday (6/4/2010), following the release of the latest sobering data, the Down Jones Industrial Average lost 323 points, dropping below the 10,000 mark once again. The stock market is responding to the misguided government policies that are now moving America towards yet another crisis.
Economic laws cannot be ignored without suffering the consequences. The longer this administration continues down this path, the worse things will be for everyone in America. What will it take for our government to finally learn its lesson that socialism always leads to societal failure and misery for everyone? Are the riots in Greece, the imminent economic collapse in Spain, Greece, and Portugal, and the failures of virtually all communist regimes to ensure prosperity for their people not enough to wake Washington up to the consequences of its catastrophic policies?
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Chris Banescu is an attorney, entrepreneur, and university professor. His business, ethics, and management articles and podcasts can be found on www.ChrisBanescu.com. He is a regular contributor to OrthodoxyToday.org, manages the conservative site www.OrthodoxNet.com, writes articles, and has given talks and conducted seminars on a variety of business and management topics. He has also written book reviews for Townhall.com and articles for Acton.org.