Happy Labor Day! Unless, of course, you’re an actual laborer. In a cruelly ironic twist, the Labor Day weekend turned out to be anything but fun and games for the ranks of America’s workers.
On Friday, the Labor Department announced that the economy had added 144,000 new jobs in August. Although the Reuters coverage declared that the labor market had “brightened,” the reality is far more bleak. The U.S. economy needs to add roughly 150,000 jobs every month to keep pace with the rate of new workers entering the market. In other words, what Reuters deems “bright,” most rational observers would deem “stagnant.”
Furthermore, let’s not forget that the Bush administration promised far more jobs when the 2003 tax cuts were passed. In July 2003, the administration’s “Jobs and Growth Plans” predicted that the economy would add 306,000 jobs every month, thanks to the tax cut. Right now, we’re about 2.7 million jobs short of those predictions. But you’d never know it according to current media coverage. As Berkeley economist Brad DeLong pointed out, even the harshest coverage from the New York Times misstated the White House’s original promises.
It’s also worth noting that the household employment survey much-loved by conservatives everywhere — reported a measly
Meanwhile, the Center for Budget and Policy Priorities looked at recently-released data from the Commerce Department and found that wage growth has been poor during the recovery, even as corporate profits continue to rise. In fact, the share of income growth that has gone to worker salaries is the smallest of any recovery since World War II. Thanks to inflation, real wages have declined in the past year, while businesses are reporting above-average gains.
Over the weekend, Mark Weisbrot wrote in his KnightRidder column that the sham Bush recovery is the culmination of a long-term trend thirty years in the making:
Prior to the “Age of Greed” it was normal for the wages of most workers to grow with productivity. If that had happened over the past three decades, the typical (median) family income would be more than $60,000, instead of the $43,300 that it is today.
Someone please tell the president. In his convention speech last Thursday, President Bush claimed, “Because we acted, our economy is growing again and creating jobs, and nothing will hold us back.” In reality, because the president acted in the way he did, the economy failed to create jobs, and is now being held back considerably. In July, non-partisan economist Mark Zandi released a study showing that the Bush tax cuts had little to do with the rate of growth over the past three years. In fact, Zandi shows that an alternative stimulus plan — including a payroll tax holiday, a temporary family-tax cut, an extension of unemployment insurance, and aid to states — would have produced more jobs over the course of the recovery.
Even if the economy does roar back to life in the next few months, the reality remains: We’ve had an exceptionally tepid recovery, and people are paying the price. Over the last three years, an additional 4.3 million people have sunk below the poverty line, and median household income has fallen by 3.5 percent. There are no “do-overs” here — those millions of workers don’t get those three years back. Not even Bush’s most lavish promises for a second term will erase the shame of his first.