What Was That About Jobs, Madam Speaker?
Nancy Pelosi said in her final pitch on the cap-and-trade bill that it was all about four words: "jobs, jobs, jobs, and jobs."
Unfortunately for her and the president, not a week after the massive energy tax was pushed through, the unemployment numbers went through the roof. In June, 465,000 Americans lost jobs -- 140,000 more than the number lost in May and than the number most economists had predicted. The unemployment rate hit 9.5 percent, a 26-year high.
The Washington Post explained:
The nation now has 14.7 million people who are looking for a job but can't find one, up 7.2 million since the beginning of the recession in December 2007. A broader measure of unemployment, which also includes people who are working part-time but want a full-time job and who have given up looking for a job out of frustration, also rose, to 16.5 percent from 16.4 percent.
Republicans, not unexpectedly, pounced. After all, the president had promised that passage of his $787 billion stimulus bill would keep unemployment at eight percent. Eight percent now seems like a distant, fond memory.
Rep. Tom Price released a statement declaring:
After five months of the so-called stimulus, Americans are left with just one question: where are the jobs? The administration assured us its bloated spending package would halt unemployment at eight percent, yet it has now hit 9.5 percent and continues a rapid ascent. This is not the economic security that Americans were promised -- far from it! It seems the grim outlook of the job market is only matched by the impending fiscal disaster to which this failed stimulus is contributing.
Minority Leader John Boehner took his trusty bloodhound in search of the non-existent jobs which the stimulus had "saved or created."
And Minority Whip Eric Cantor was quick to weigh in as well, chastising the president's failure to focus on the public's number one concern:
Inexplicably, instead of focusing on jobs and restoring the financial security that has been lost by millions of struggling families, the president continues to push an agenda that the majority of Americans are uneasy with. The American people do not support a government health care plan that will increase costs, reduce patient choice and flexibility, and lower the quality of care available in our country. The American people do not support the radical cap & tax plan which will impose a hard-hitting tax upon families and small businesses costing our struggling economy thousands of jobs.
Pundits debated why the president's stimulus had not delivered. Maybe he should have tried those tax cuts which Republicans had suggested. Perhaps once again we have learned that Keynesian schemes don't work. But in any event the party in power at both ends of Pennsylvania Avenue will have a hard time shirking responsibility for the atrocious jobs outlook.
Moreover, it remains unlikely that a consumer-driven economy will rebound so long as so many consumers are out of work. As the Wall Street Journal reported:
"Jobs are usually a lagging indicator, but this time they're almost a leading indicator in this scenario," said Doug Roberts, chief investment strategist for Channel Capital Research. "Right now, if the consumer at these levels feels there's a prospect of him being unemployed, he's going to pull back. This is a consumer-led recession, and despite the government's best efforts, they can't get them to spend."
The jobs problem creates a number of political problems for the White House.
First, it bolsters the "no" party which inveighed against the stimulus and predicted, quite correctly, it would do nothing to put people to work. Republicans who voted against the stimulus and opposed it as a giant waste of taxpayers' money look rather smart.
Second, the skyrocketing unemployment figure creates further doubts about the viability of the cap-and-trade plan. Those 44 Democrats and all but eight Republicans who voted against the bill, in large part because imposing a huge energy tax and new regulatory regime on American businesses is a "job killer," may now find many in the Senate who agree. Moreover, with the addition of a convoluted scheme of "offsets" that allows a company, for example, to buy a rain forest in Brazil to make up for its own emissions, it will be increasingly difficult to argue that any of those "green jobs" are being created here in the U.S. What is being created is a giant tax, anti-trade, and government intervention regime. And the "jobs, jobs, jobs, jobs"? They are actually predicted to go down.
Third, once again the public and the president's critics will begin to ask why the president is engaged in a non-stop effort to pass a government takeover of the health care industry rather than focusing on creating jobs and fostering an economic recovery.
The White House is nothing if not dogged in its determination to use the "opportunity" which an economic crisis presents to remake the American economy. But for now, the opportunity is proving to be the undoing of the president's credibility on the economy and reason for Democrats on the ballot in the next year or so to panic.
What are they going to say when Republicans ask: "Where are the jobs, jobs, jobs, jobs?"