Ryan Avent is listening to a budget briefing:
OMB head Peter Orszag is giving a press conference just now with Christina Romer, head of the Council of Economic Advisors, on the president’s Fiscal Year 2011 budget. Ms Romer explained the economic assumptions underlining the budget forecasts….She then gave the unemployment forecast. At the end of 2010, the unemployment rate, according to the administration’s forecast, will be 9.8%. At the end of 2011, the rate will be at 8.9%. And at the end of 2012, after the next presidential election, the unemployment rate will be 7.9%.
Good God. I suppose this isn’t a big surprise anymore, but it’s still painful to have your nose officially rubbed in it. In any kind of normal economy, 8% unemployment would be considered disastrously high, but Orszag and Romer say we’re not even going to improve to disastrous levels for another three years. A $100 billion jobs bill, even assuming it passes, is going to do very little about this.
Our economy is going to stay fragile for a very long time. I sure hope our banking system can handle that. Our political system too.