Job creation in the real world: Senate Majority Leader Harry Reid is already catching heat for saying:
We feel the American people need a message. The message that they need is that we're doing something about jobs.
This comment comes on the heels of news that a bi-partisan jobs bills has fallen through, and Reid is now plowing ahead with a slimmed-down four-point plan. Yes, what Reid said is a bit tone-deaf. The American people don't need a message that Congress is doing something about jobs; they need jobs...
But then Barbara goes off-message:
At the same time, Reid's framing is one of the most honest I've heard yet in the discussion about job creation. The American people may not need a message, but that's pretty much the most Congress has to offer on the jobs front—at least in the short run.... Yes, we all want jobs to come back quickly, but we lost more than 7 million of them, and it's going to take some time....
The reason it's so tough for the government to simply whip up jobs, of course, is because the fundamental thing that drives companies to hire is an increase in demand for their products and services. The government has already done a lot to bolster demand in the economy. For example, stimulus spending.... But with the economy's biggest spenders—American consumers—still reeling from the downturn, not to mention too much debt, such efforts will only go so far.
The other chunk of the jobs bill that remains is a tax break for hiring.... Noble effort, and if you don't mind paying $13 billion over 10 years to do it, fine, but it's not going to be a game-changer...
The President's Council of Economic Advisers says:
And I think these numbers are about right. What they don't say is that by the end of 2010 they project that the number of stimulus-supported jobs will be down to only 1.2 million or so: stimulus spending in fiscal 2011 will proceed at only 1/3 the rate of stimulus spending in fiscal 2010.
Harry Reid could simply propose to extend ARRA spending at its current pace until the unemployment rate falls below 8%. That would be a game-changer--for at least a million Americans who would find that they had jobs as a result.