Latest economic forecast shows recession lingering on A new normal for unemployment?

WASHINGTON, DC—The latest unemployment numbers show the jobless rate has crept up from 9.7 percent to 9.9 percent. While an initial reported 290,000 jobs were created in April, but that number is subject to revision. What’s more, 66,000 of those jobs or nearly 23 percent are temporary Census jobs.

It seems the rise in unemployment numbers are due to approximately 195,000 formerly discouraged workers that were part of the larger U-6 measure (which likewise increased to 17.1 percent from 16.9 percent) again beginning to look for work. The American people were assured that passing the stimulus bill would keep unemployment under 8 percent, yet the unemployment rate has remained largely unchanged at just over or just under 10 percent.

So what has America got to show for $787 billion stimulus? Apparently more government workers, according to Gallup, the government is outpacing private sector hiring 40 percent to 28 percent. Even state and local governments combined are hiring 2 percent more than the private sector but are actually letting more state and local employees go simultaneously.

The effects of stimulus chiefly helped states (for a time) and large corporations, but has not curbed the recession—once again proving Keynesian economics simply don’t work, nor put people to work in the private sector.

-- Killswitch Politick

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Getting real about the national deficit? The Fed Chair is telling Washington the Reagan model was the right model

WASHINGTON, DC—Ben Bernanke, the Federal Reserve Chairman has told a White House debt commission the United States needs to seriously begin deficit cutting which currently stands at $1.4 trillion. Mr. Bernanke went on to urge an engaging, sobering reevaluation of the US Tax Code but made no specific recommendations.

Rudy Penner, a former director of the Congressional Budget Office under Ronald Reagan told the debt commission, "I think it just screams out that we do something about this tax code." 

Conservatives have long argued that cutting marginal tax rates as well as reducing capital gains taxes and corporate taxes will bring more money into the Treasury via tax revenue and indeed, the three times rates were reduced by Presidents’ Kennedy, Reagan, and Bush 43, tax revenue increased substantially. But tax cutting is only one part of the equation—federal spending must be cut as well, not just minor percentage cuts in the rate of growth.  

Liberals have argued against this method (and history) and against cutting federal spending—demonizing the first as “tax cuts for the rich” and the latter is “draconian cuts in Medicare and Medicaid”.

-- Killswitch Politick

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