The "Zombie" Economy
Last week, the Labor Department released another disappointing jobs report. It showed the unemployment rate remaining stuck at 8.2 percent, with the economy gaining only 80,000 jobs in June – far short of the number needed just to keep up with new jobseekers attempting to enter the workforce.
And recovery does not seem to be in sight. The president’s plan to revive the economy through massive amounts of stimulus spending is simply not working. Indeed, our country has now lost 473,000 net jobs since the massive $1 trillion stimulus package was signed into law in February 2009. If you remember, we were promised at that time that the stimulus would bring unemployment below 6 percent by now; instead, we just marked the 41st month in a row under President Obama that unemployment has remained higher than 8 percent!
Some have begun to term this a “zombie” economy, one that is not quite alive and not quite dead. Jobs, for instance, are increasing – but at such a slow crawl that we’re actually losing ground because of the number of new entrants to the job market each month. Moreover, the “real” unemployment number (that is, the rate that includes those who have stopped searching for a job and those who are working part-time because they can’t find full-time work) has now ticked up to nearly 15 percent.
America is not known as a country where people give up. Yet, record numbers are now on food stamps and/or disability. Families are struggling to keep their homes. Small businesses find themselves up against incredible headwinds. Recent college graduates are having a terrible time in their job searches. For many Americans, it has never been harder to find or keep a job. And some are beginning to lose hope.
It doesn’t have to be this way.
Some will remember how bad things were in the late 1970s when we faced many of the same types of economic problems. There were those then who proclaimed that America’s best days had come and gone, and that it was time to accept a diminished standard of living at home and a weaker role in the world.
Yet, just a few years later, it was “morning in America” again after President Reagan put the necessary reforms in place. There is nothing preventing us from similarly turning things around now. But, to change course, we need new leaders and a different approach.
Some states are showing how new leaders can make a big difference. Pro-reform governors from Virginia to Indiana have put the right policies in place – such as cutting spending, reducing and streamlining regulations, and enacting pro-growth policies – and their economies have improved as a result. This can hold true at the federal level as well. It’s not our country or our character that’s preventing us from reaching our true economic potential – it’s that we are not pursuing the right policies. For instance, we should curb spending, refrain from raising taxes, reduce unnecessary and burdensome regulations – and stop assuming that only government control can solve problems like health care.
With the right policies and the right leaders, we can emerge from our problems even stronger and more resilient than before.
Sen. Jon Kyl is the Senate Republican Whip and serves on the Senate Finance and Judiciary committees.
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