Official government statistics announced today that unemployment had reached 6.7%, far exceeding "official" forecasts. I say official because serious progressive economists and labor sociologists have long contended that the "official statistics" seriously and deliberately undercount unemployment numbers. This was in effect alluded to by the press reports, which mentioned that "a mass departure from the work force helped to hold down the unemployment rate...." The government in the Clinton administration in response to longterm criticisms from labor and progressive academics began to compile an "underemployment rate" which includes part time workers seeking full time jobs and those who have "officially" been dropped out of the statistics because they are longterm unemployed.
The press rarely reports the underemployment rate but did this time. It jumped from 8% to 12.5% the largest it has been since the BLS began to calculate it. If the underemployment rate is a more serious calculation of the employment crisis and its likely trajectory as I think it is, we are in the very early stages of a depression, not simply the "longest recession" since the 1930s, which the Bush administration is now admitting even though it denied through the election that the U.S. was by "official' statistics in a recession until very recently.
By the way these statements are also being made by establishment business analysts who are predicting massive layoffs particularly if the auto industry collapses (the auto industry is more than simply jobs for auto workers but connects to jobs for a wide variety of connected businesses).
Spokesmen for finance capital(meaning here Wall Street and big bank analysts) are deeply "pessimistic" predicting significant decline in GDP and significantly higher "official" unemployment statistics for 2009. They have no solution, except to say that there aren't any "quick fixes" or likely "quick rebounds" in the near future.
Essentially what they are saying is what Andrew Mellon said to Herbert Hoover in the early stages of the Great Depression, that is, let the crisis run its course, with one important caveat: they are preaching what Mellon practiced when he left the position of Secretary of the Treasury so his banking empire could receive bailout money from the Reconstruction Finance Corporation, that is, bail us out and as for the people, let them bear the brunt of unemployment, sharply declining
real incomes for the employed, home foreclosures, family breakups,
rising crime rates, and all of the the other consequences of letting the crisis run its course.
Government must act and act now, as FDR used to say. It must begin to address the peoples depression. Nationalizing the banks would be a radical solution but one, if it were connected with a restructuring of bank credit card debt, providing massive debt relief for tens of millions of Americans, might both help those citizens and their families and begin to revive consumer purchasing power relatively quickly.
It might also, if it were connected to public control of the mortgage division of finance capital, see a relatively quick revival of the construction industry(which would also benefit from major public works projects) increased minimum wages and most of all, increased trade union membership by the passage of the Employee Free Choice Act as a beginning to the repeal of all post WWII anti-labor legislation and a partnership between the trade union movement and the Obama administration to rapidly increase union membership would empower working people to protect themselves from the depredations of capital while increasing their mass purchasing power.
Since I am not a utopian, I do not expect this to happen immediately and most of our readers, I am sure, have great doubts that most of it will ever happen. But it should be what we are fighting for in 2009 as we seek through mass struggle to lead an administration move in that direction, not the direction that the spokesmen for finance capital are projecting, that is bailouts on a piecemeal basis and encouraging the people to learn to live with double digit unemployment, much higher levels of the double digit underemployment we already have, until the crisis rides itself out and prosperity once more "trickles down" to the people.