Three recent major polls show a declining job approval level for President Obama. Gee, just when I thought we were going all warm and fuzzy over the recovering economy. What's up here?
Turns out the polls do reflect a rising sense that things are getting better and moving in the right direction. But that may be a rather shallow and mixed feeling of relief, of a type occasioned by the brief but welcome intermissions during a lengthy waterboarding session, which insure the victim doesn't actually expire. After all, many of the newly hired, even those in the manufacturing sector, are being brought on board at a relatively steep discount, compared to the compensation levels which obtained for similar positions and experience just a generation ago. So, business is getting what it has wanted all along: cheap labor.
Most people, including first time employees, know this at least intuitively if no other way. And even though being hired on the cheap is better by far than being cast overboard and left to drown, it's not like sailing away to paradise island. The Economic Policy Institute (EPI) today released findings reflecting the fact that male college graduates aged 23 to 29 saw their starting salaries reduced some 11% (inflation adjusted) over the last decade. And there remain almost 4 job seekers for every available opening. EPI also supplied data which gives lie to recent mischaracterizations by the formerly honest and reliable Wasthington Post newspaper and others that China's growing middle class was creating increased demand for our finished manufactured products, as well as agricultural surpluses. In fact, our exports - what there are of them - continue to be predominantly scrap metals and raw materials, which China turns into high-end, value added goods they sell back to us, displacing more good jobs and piling up greater trade deficits.
Past all of this sad news, consider a decidedly more ominous measurement reflected in current polls: seventy-five percent of Americans regard the country's financial shape as "fairly bad" or "very bad." This is the root of our and Obama's dilemma. Indeed, the widespread - and wrong - public perception of national debt says a lot about the continuing global economic predicament writ large.
In the first instance, the current level of national debt is not the "mother of all burdens" drag on the economy. Just the opposite is the case. What we really need is more - lots more - of it. Government borrowing is not crowding out private investment. There simply is no strong private investment demand for capital, largely because there remains too little consumer demand for the output of expanded production. That is an undeniable fact. But it is only one-half of the story. The other part is that money continues to be very cheap by any measure. Historically low interest rates prevail as they have for the last five years, giving lie to every prediction and pronouncement of imminent calamity from wrong-headed right-wingers and Republicans. More than that, the failure to take advantage of almost free money now to use as infrastruture and other much needed public investment is not only a sin, but in the long-run self-defeating. It will cause even slower growth going forward, along with an ironically and consequently higher debt. The only greater public policy sin popular today is the gluttonous and greedy insistence that the pain creators continue to be allowed to shirk their responsiblity as American citizens by refusing to pay anything remotely resembling a fair tax rate.
And the only worse overall scenario possible is that a truly crazy president might actually replace the current lame one. May the luck of the Irish be with us, we are going to need it. Happy St. Patrick's Day. Hope to resume a respectable pace of posting following today's celebrations. See you there.