The economic crisis took another ugly turn Friday when the U.S. Labor Department announced 598,000 Americans lost their jobs in January – the worst total since December 1974.
About 3.6 million jobs have vanished since the recession began in December 2007, and about half of those jobs were lost in the past three months.
The national unemployment rate is now 7.6 percent, the worst since September 1992. Some economic analysts predict the rate will increase to 9 percent during the next six months and stay in that ballpark through 2010.
Those aren’t Great Depression kind of numbers, but they reflect the biggest 13-month change in employment since 1939, the first year such statistics were kept. The job market is getting worse every day. On top of that, three more banks closed Friday, raising the number of bank failures this year to nine.
Something substantive needs to be done to curb the problem, and fast. An $827 billion economic stimulus package is expected to pass the Senate early next week. There probably still is some pork that could be trimmed from the bill, but at least the Republicans forced the Democrats to cut some excess spending. Unfortunately, there haven’t been enough detailed reports in the media about what is in the stimulus package beyond the talking points of both political parties, so the average American doesn’t have a fully informed opinion about the bill’s contents. But I think it’s fair to say the average American wants a working stimulus bill enacted now.
The Republicans say the stimulus package is filled with too much pork spending, and they are right. President Obama says the bill isn’t perfect, but tries to tackle the economic problem in a way different from the Bush administration’s failed approach. The Senate version of the stimulus bill is somewhat of a compromise between the two schools of thought, though obviously it retains more of a Democratic flavor.
I’m usually not one to support excess government spending, but I think it probably is warranted in this case. Spending money is what stimulates the economy. Yet just throwing money at the problem is not the answer – the money needs to be thrown accurately at the target. That is why Obama must do better than his predecessor in calling for transparency and accountability when it comes to spending billions of taxpayer dollars. His economic advisers also need to share their strategy with us, the American people, so we understand what is happening with our money. I’m sure we will be told if a certain approach is working well, but we deserve to know if something is not working, too.
In the meantime, people of all political persuasions need to hope this bill delivers the intended economic stimulus before the song “Brother, Can You Spare a Dime?” makes an unwanted comeback.