Obama Economic Policies and High Unemployment

Millions Still Out of Work

The United States is currently in the midst of the longest and deepest economic recession since the Great Depression of the 1930s. The just released June 2012 employment report showed the unemployment rate still stuck at 8.2%. That translates into 12.7 million people without jobs.

Almost half of these people, 5.4 million people, have been unemployed for more than two years.

Bad as the above information is, the real situation is worse. The definition of unemployed used by the U.S. Department of Labor’s Bureau of Labor Statistics (BLS) defines a person who is unemployed as someone who is not only out of work but is also actively looking for work.

Even though a person is out of work, if they are not actively trying to find work, they are not considered unemployed for the purpose of compiling government unemployment statistics.

Another 2.5 Million Unemployed Who are Not Included in Unemployed Statistic

In addition to the 12.7 million people officially listed as unemployed there are another 2.5 million people listed as marginally attached to the labor force.

These are people who don’t have a job but are available for employment. However, having become discouraged, they have have stopped actively looking for a job and are thus no longer officially considered to be unemployed.

Combining these two figures we get 15.2 million (that is 15,200,000 unemployed American workers) or 9.8% of the labor force unemployed.

Even this figure underestimates the true picture as there are a few million more people who are no longer being counted in the statistics as either unemployed or marginally employed.

These are young people who have yet to land their first job, returning military who can’t find civilian employment and others who retired early out of necessity or who are relying on working spouses or other employed friends or relatives for support.

There Are Also 8.2 Million People Who are Underemployed

Finally, while ignoring the few million who don’t have jobs but are off the radar as far as employment statistics are concerned, we have, in addition to the 15.2 million Americans available for work but not working, an additional 8.2 million (8,200,000) working part-time involuntarily.

These 8.2 million are people who want to work full time but due to either hours being cut back by their employers or the inability to find full time work are subsisting on part-time work.

A Tragedy for Bothe the Unemployed Individuals as Well as Society as a Whole

This situation is both an individual tragedy for each of these millions of American individuals who are out of work as well as a tragedy for society as well.

Start with taxes. The Federal, state and local governments are all hard pressed for money with which to operate and provide their services. Ignoring for a moment spending by all levels of government, imagine the impact that the addition of 15.2 million taxpayers to the tax rolls would have on the deficits of all levels of government.

In addition to the increased revenues from the taxes paid by these 15.2 million people, there would also be the savings to all levels of government from not having to spend to provide the social services these unemployed currently need.

Plight of Those Forced into Early Retirement

The 15.2 million represent those who are officially counted in the statistics as being unemployed or marginally attached to the labor force.

There are also those who have dropped out of the labor force completely with many of these being older people who, out of financial necessity, had to take early retirement and begin collecting Social Security, pensions and drawing down retirement savings.

Not only have these people had to accept lower monthly lifetime Social Security and pension payments for taking early retirement but, in the case of Social Security, people who begin receiving Social Security benefits between age 62 and full retirement age, will have their monthly benefit reduced by one dollar for every two dollars earned in excess of the annual limit.

For 2012 the wage earnings limit for those receiving Social Security retirement benefits between age 62 and their full retirement age is $14,640.

After full retirement age (which is 66 for most of the boomer generation) earnings from wages no longer reduce one’s monthly Social Security income when their wages exceed the annual limit.

Social Security System In Deficit Six Years Earlier Than Expected

In addition to the harm done to the unemployed by the recession, taxpayers are also harmed.

As a result of so many people being laid off, Social Security and Medicare tax receipts fell.

This, plus the large number of workers age 62 and older who had no choice but to take early retirement and begin collecting Social Security, has resulted in the Social Security program going into deficit in 2010 as monthly payments to retirees exceeded Social Security tax receipts from workers and their employers.

This was six or seven years earlier than the pre-recession projections whose calculations showed this not happening until 2016 or 2017.

The monthly deficit is now being made up with general revenue funds which means that all taxpayers are contributing to Social Security through their income and other Federal Taxes.

Wage earners and their employers are paying twice - once through their Social Security taxes (which are not progressive with the tax, in 2012, being applied to every dollar of a worker’s income up to $110,100) and again with their income taxes.

Additional Strains Put on Private Pensions and Government Pension Guaranty Program

Corporate and Union defined benefit pensions are also affected. As workers retire earlier than expected not only draw against the assets of these plans sooner but the plans themselves lose those extra years when contributions were expected to be made and returns reinvested.

These pensions are already underfunded so this will just put more pressure on them.

Private pensions are insured by the Federal Pension Benefit Guaranty Program which was under financial strain before the recession and will now be under even more strain which will require a taxpayer bailout sooner rather than later.

President Obama Has Followed The Same Policies That Prolonged the Great Depression

President Obama has made no secret of the fact that his goal was to move the political center of the United States to the left and he and the Democratic majority in Congress have used this crisis as a means of achieving that goal.

Copying the policies and tactics of Franklin Roosevelt, this Administration has both attempted the same failed policies of the New Deal and, so far, have achieved the same disastrous results.

Instead of an economic downturn followed by a robust recovery as has happened in past recessions since Franklin Roosevelt’s Great Depression, this recession has tended to parallel the Great Depression with a major downturn followed by a weak recovery that stalled with real unemployment stuck in the double digit range.

As a result of the policies pursued by President Roosevelt and his New Deal the economic crash of 1929 was followed by two decades of economic stagnation that didn’t end until his passing and with it the weakening of the appetite of Congress and the American people for his destructive policies.

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Comments 27 comments

Tom Koecke profile image

Tom Koecke 4 years ago from Tacoma, Washington

Please don't apologize for the delay. Your response was worth the wait.

With all due respect to Bastiat, I don't see the comparison between the falsity of a broken window spurring an economy, and four years of shortages with low unemployment coupled with 400,000 breeding age men dying, thereby not needing jobs and raising the average age of Americans, serving as a catalyst for growth over the next couple of decades. It would be comparable provided had WWII not happened, we would have become a superpower and 400,000 breeding age men would have died anyway.

There was also an economic boon after the black plague stuck Europe.

It just follows that after significant loss of life is realized, the same amount of resources can be spread further. The prosperity in these cases is more realized by those who were deprived of the resources, or on the cusp of deprivation. The rich actually suffer a bit. They have to pay more for help as the resource of inexpensive labor is largely what was hit the hardest.

You said, though, that I contended a war was good for an economy. I think if you reread what I wrote, I contended war is not good for an economy despite that WWII seems to have spurred the economy.

If crime and poverty could not be linked, then prisons would be more representative of society as a whole, and ghettos would be as safe as suburbs.

However, we need not look up a whole lot of studies to try to find examples of what happens when those without amass in sufficient numbers relative to those who "earn their entitlements" through such things as birthright, contacts, and prudent business practices. A couple of examples of what happens is the French and Bolshevik Revolutions.

It is my opinion that redistribution actually is more beneficial for the rich than it is for the impoverished. You can keep a lot of people in line with the promise of a $700 check on the first of the month if they keep their noses clean. Without that promise, one must presume that the survival instinct will not rear its head in order to jump to the conclusion that starving people will not find a way to eat whether it is lawful or not.

I also question parts of Obamacare, largely the individual mandate, and the penalty being considered a tax rather than a penalty. However, most people like that they can insure children in college, there is no cap on coverage, and they can buy insurance without pre-existing conditions disqualifying them. A million dollars just doesn't go as far as it used to, and that type of limitation can be eaten up with one major illness.

Thank you for your response. Though we may disagree on many points, you have shown yourself to be a gentleman in the way you pleasantly discuss the disagreements.


Chuck profile image

Chuck 4 years ago from Tucson, Arizona Author

Tom Koecke - First of all I don’t dispute that World War II and the sacrifices necessitated by that war were necessary. We had no choice but to have young men and women take up arms to fight and for the rest of the nation to mobilize all of its labor, factories and other resources to producing the war material needed to fight that war.

While this mobilization met the definition of an economic stimulus in the eyes of economists like the late John Maynard Keynes and ex New York Times economic writer Paul Krugman, it did nothing to make people’s lives better economically.

Almost the entire labor force had a job and a paycheck and unemployment was near zero but there was little to buy with the money people were making. No civilian cars were produced (there was an Executive Order by President Roosevelt forbidding the production of civilian cars and this was in effect until VJ Day when President Truman lifted it), food, clothing and other goods were in short supply with many goods rationed.

Your comment “The shortages and significant loss of life in the 1940s set us up for significant growth in the next couple of decades. People could buy, build, and have kids, and those were all positive.” Is a classic example of the nineteenth century French economist Frederic Bastiat’s broken window fallacy.

In this parable, Bastiat acknowledged that a shop window broken by a vandal appears to stimulate economic activity as the owner of the shop is forced to spend money to have the window repaired. This sets off a chain of economic events as the glazier spends the money earned from repairing the window and that money is in turn spent by recipients down the line making it look like the broken window was beneficial to the economy.

However, as Bastiat goes on to explain, if the shopkeeper hadn’t had to pay for the repair of the window, he would have spent the money on something else, like a new suit, which would have also resulted in stimulating the economy in the same manner.

So, again, while the war and associated sacrifices were necessary to defend our nation and protect freedom, it was an economic drag on the economy.

If war production is such a plus for an economy then the former Soviet Union should not only still be in existence but should have surpassed us economically by now. And, North Korea, another communist nation whose economy is devoted to war production, should have the world’s fastest growing economy.

As to ObamaCare, I am totally opposed to it. Not only will its costs severely damage our economy but the entire program is nothing but an attempt to make the entire middle class dependent upon the government and thereby forced to support big government. The program is nothing more than a big push on the road to serfdom for Americans.

As to RomneyCare I am totally opposed to that as well and would fight any attempt to enact it in my home state of Arizona.

However, as I believe Chief Justice Roberts pointed out in his ObamaCare is a tax decision, RomneyCare, ill conceived as it is, and its insurance mandate is allowed under the U.S. Constitution which leaves this type of police power to the individual states.

The Founding Fathers’ idea behind this is that, local officials are closer to the people at the state level and it it is also easier for individuals to throw the rascals out and repeal laws they don’t like.

In addition, any residents of the Commonwealth of Massachusetts who do not like RomneyCare can move to another state. As one who grew up in New York state, I am one of the many from the left leaning states in that area who have voted voted with our feet and moved to states which offer more freedom from nanny style government, lower taxes and more opportunity.

However, to escape ObamaCare one would have to leave the United States, renounce their citizenship and, in some cases pay a hefty exit tax in order to do so.

As to kicking people off welfare, Social Security and other programs that you keep implying that I favor, I haven’t provided any opinion on this, one way or the other, in the Hub itself or in my comments. Also, what evidence do you have that eliminating these programs would result in those losing these benefits to turn to crime?

We already have over fifteen million people out of work and many of them no longer receiving unemployment checks. How many of them have turned to crime?

As I recall from graduate school years ago these theories linking crime and poverty were popular but every study that tried to test the theory showed little or no correlation between the two and you are the first one in years who I have heard to claim that poverty leads to crime.

Thanks again for sharing your views and I apologize for my delay in responding.


Chuck profile image

Chuck 4 years ago from Tucson, Arizona Author

internpete - thanks for your comment and for sharing my Hub.

You are right about history being ignored. As I mentioned in a reply to another comment on this Hub, I feel that FDR and President Obama, like most progressives, understand the laws of economics but prefer to ignore them in order to try to re-arrange society the way they think it should be.

Thanks again for visiting my Hub.


internpete profile image

internpete 4 years ago from At the Beach in Florida

Nice hub. I totally agree that Obama's actions have led to lengthening the current economic downturn much in the same way FDR prolonged the great depression. It is sad to me that history is so easily available, yet so many ignore it. I think much will change come November! Shared, because more people need to read this!


Chuck profile image

Chuck 4 years ago from Tucson, Arizona Author

jdmanista - to be honest, I don't know of any nation that is using socialist economic policies and growing faster than the United States currently. I tried to find the comment that you were referring to and even did a word search on the word "socialist" only to find that the only place in this entire Hub where it was used was in your latest comment.

As I indicated in my previous response, Sweden, which has traditionally been a classic welfare state, has been getting through this crisis quite well. However, they currently have a conservative government and a very good libertarian leaning Finance Minister named Anders Borg who would be a great replacement for our current Treasury Secretary Timothy Geithner (or President Obama for that matter but, unfortunately, Mr. Borg doesn't met the Constitution's citizenship requirement to be President of the U.S.). The other Nordic nations of Europe are also doing better economically compared to the rest of Europe but, again, most of them have moved to the right politically in recent years.

Left leaning economists and political leaders throughout modern history generally understand the economic laws that govern human economic activity and all of them agree that the free market is the best way to grow an economy, create productive jobs and provide increasing abundance for all. Where they differ is that they feel that redistribution and other socialist ideals are better for a society than jobs and improving living standards.

Vladimir Lenin understood this and, when faced with total economic collapse, relaxed his communist economic policies with his New Economic Policy (NEP) in 1920 by allowing many peasant farmers and small business owners to retain ownership and make profits.

President Roosevelt who, like President Obama, was satisfied with the high unemployment and anemic growth that resulted from his economic central planning, was forced to change when World War II came along. Realizing that we could not win the war with the shackled economy, he gave businesses in areas critical to war production a larger degree of freedom to operate.

There are dangers to socialists when they do relax the grip of their control over the economy as Mikhail Gorbachev, the last Soviet Premier, learned when his policy of Glasnost turned out to be so popular that the people drove it further than he wanted resulting in the collapse of communism and a free economy this is light years ahead of the former communist "paradise".

The late, left leaning, economist J. Kenneth Galbraith opposed President Kennedy's proposed Keynesian style tax cuts on the grounds that people might like them and oppose the later increases that Keynesian policy called for leaving common people rather than politicians to decide how the incomes they earned would be spent.

So, if there are any socialist nations whose economies are doing better than that of the United States it is probably due to their use of free market policies.


Chuck profile image

Chuck 4 years ago from Tucson, Arizona Author

pride-n-prejudice - I couldn't agree with you more. Thanks for your comment.


Chuck profile image

Chuck 4 years ago from Tucson, Arizona Author

rickylicea - thanks for your comment. You are correct in that I could have shown in more depth how President Obama's policies are causing these problems. However, for space reasons, I decided to limit this Hub to a description the results of these policies and describing some of the damage from the high unemployment caused by these policies.


pride-n-prejudice profile image

pride-n-prejudice 4 years ago

I believe that FD Roosevelt did start our country in the wrong direction despite what they taught me in public school. I'm not terribly knowledgeable in this area, but when you depend on funds from the government for personal benefit you are not entirely free. We have come in bondage to the government in greater degrees in the last 50+ years. We (America) are not the great power we once were. Our money is not ours.


rickylicea 4 years ago

"A Tragedy for BOTHE THE Unemployed Individuals as Well as Society as a Whole"

You didn't really go into depth on Obama's policies, just described the current economic situation.

For example you could have talked about how Obamacare will increase the cost of labor and therefore reduce demand for labor.


jdmanista profile image

jdmanista 4 years ago from Ladera Ranch, CA

Chuck, thanks for the follow-up, some good info. As to the economies that are recovering faster I was referring to an earlier comment that suggested there are socialist economies that are recovering at a rate faster than us. Thanks again.


Tom Koecke profile image

Tom Koecke 4 years ago from Tacoma, Washington

I have heard that WWII brought us out of the Great Depression, also, Chuck. Still, the numbers show that the GDP was growing, and unemployment was shrinking. Crashes are sudden, but recoveries trend slowly. It is rather like watching a child grow. If you see the child every day, the change is not so noticeable. If you saw the child in 1930, but not again until 1939, the change would have been highly noticeable.

There is another dissimilarity between then and now. We were not a superpower then, so we needed a ship a day and better weaponry. We do not need those things today, so even the wars we are in will not help the economy. They just drain from it.

The shortages and significant loss of life in the 1940s set us up for significant growth in the next couple of decades. People could buy, build, and have kids, and those were all positive. Today, those things would not be positive.

So, let's get down to the points of the matter:

Are you totally against Obamacare, or do you think there are benefits by closing the donut hole, allowing you to keep your children on your policy through college, taking limits off coverage to ensure a bout of cancer does not make you uninsurable, and eliminating the pre-existing conditions? If you are against these things, how does Romneycare in Massachussetts make you feel?

Do you believe taxes should be cut for the rich to create jobs? If so, how do you reconcile that wages are tax deductible, and apply that to paying less taxes on outsourced labor will increase employment at home?

Do you think that eliminating welfare stipends will not lead to unintended consequences (i.e. increased crime creating the need for increased prison space) that will just lead back to making it less expensive to kick the poor $8,000 a year rather than having them housed at $75,000 a year or more?

Do you believe that redistribution policies do not result in additional spending that benefits the economy, but that lower taxes for the rich do result in additional spending that benefits the economy?

These are the questions that we are faced with now. There are many people who are on social security and medicare, or who draw military retirement, who think entitlements should be cut without realizing they are beneficiaries of entitlements. My own observation is that people are in favor of other people losing their benefits, but want government spending to continue in the areas from which they benefit.


Chuck profile image

Chuck 4 years ago from Tucson, Arizona Author

scottwkelley - thanks for your comments. I especially liked your suggestion that Congress and other state and local legislative bodies took a year or two off.

This actually happened in the former British colony of Hong Kong following World War II. Hong Kong was occupied by the Japanese during World War II. When the war ended the Japanese left but the British, busy at home and in Europe were unable to return and re-establish the government in Hong Kong immediately.

After a few months James Cowperthwaite was dispatched to Hong Kong with orders to re-establish the government and implement policies to restore the economy which had been all but destroyed by the war. When Cowperthwaite arrived he found that the people had already started re-building on their own and were doing a great job of recovering.

He took a hands off policy and, as Royal Governor, kept the government and its role to a minimum. Hong Kong boomed and, at one point during the 1970s when Great Britain, the mother country for Hong Kong, was in an economic free fall during long years of economic misrule by both Labor and left of center Tory governments, tiny Hong Kong's GDP actually exceeded that of Great Britain.


Chuck profile image

Chuck 4 years ago from Tucson, Arizona Author

jdmanista - I totally agree with you. The media and academia worshiped him. From video and recordings of Roosevelt I have seen and heard he did come across, like President Obama, as a likeable person. But his policies were a total failure.

As to nations that are recovering faster, two that come to mind are Sweden which used to be looked upon as the ideal welfare state and former Soviet Baltic state of Estonia. Both of these have good economies as a result of cutting taxes and reducing regulations.


Chuck profile image

Chuck 4 years ago from Tucson, Arizona Author

Tom Koecke - I don't disagree with what you say about unemployment and economic growth while Franklin Roosevelt was President.

However, while bringing unemployment down for 24.9% to to 14.3% is a step in the right direction this is hardly a booming economy full of opportunity for people. Economic growth did occur under Franklin Roosevelt but it was anemic. Economic downturns both before and after the 1929 crash (with the exception of the Obama recession) have been shorter and more robust that than the ones experienced under both President Roosevelt and now President Obama.

As to World War II this was a special situation. We did have full employment. But out of the necessity almost all of what was produced by that full employment economy was war material. We needed to do this and it allowed our nation to survive but from an economic standard of living standpoint the results were poor.

During the World War II no civilian automobiles were produced and very little civilian clothing was produced. My Father, a WW II veteran, and other returning soldiers and sailors had to continue wearing their uniforms following discharge as many had outgrown their civilian clothing from before the war and new clothes were scarce. Gasoline, coffee, sugar, meat and a host of other goods for civilian consumption were in short supply and rationed. Basically, the economy produced very little for civilian consumption leaving taxes and savings (called war bonds in those days) as the only things workers could spend their pay checks on.

Interestingly, growing up in the 1950s and 60s it was common to hear people - my Father, other relatives, teachers, etc., when talking about FDR's Great Depression, would say "well, you have to admit that it was really the war that got us out of the depression". That phrase pretty much sums up the view of those who lived through the Depression of the 1930s the general view of President Roosevelt's policies which managed to reduce unemployment 14.3% for a while before World War II.


scottwkelley profile image

scottwkelley 4 years ago from Petoskey, Michigan

I couldn't agree more Chuck. One of the big issues I have are most of the laws we have today along with all the regulations and taxes to businesses. It was a well designed map to drive business out of this country when the fair trade came about. By allowing companies to leave and still sell their products here in their homeland is dishonorable at best. Changing the amount of immigrants we let into the country per year from 180k to unlimited is sinking the ship, we don't have enough life jackets for everyone. People who put Ronald Reagen on a pedestal don't remember that he started most of this crap we are in today. Spending, creating programs that was called Trickle Down Economics as we are still doing it today on a grand scale. For some reason or another we have forgotten what being an American is all about. Look at it this way, if all legislators, state and fed took a year off would you miss them? Try two years and we may forget they even existed. For every law that they pass has only one out come, a cost on you and me sooner or later, the consumer!


jdmanista profile image

jdmanista 4 years ago from Ladera Ranch, CA

Josak, FDR is loved because Progressives have distorted our education and claim the New Deal solved the Great Depression. Any real economist will tell you different.

Unemployment skyrocketed under Bush because he was the President during the crash, that's usually how that works. Obama has extended the Recession longer than necessary just like FDR because of their liberal legislation.

And exactly which countries are recovering faster than the US?


Chuck profile image

Chuck 4 years ago from Tucson, Arizona Author

scottwkelley - thanks for visiting and for your comments.

My simplistic answer to your question of "If I was President I would _________!" would be to reduce taxes and cut back on regulations. Regulations are strangling the economy and high taxes are discouraging investment which creates jobs.


aethelthryth profile image

aethelthryth 4 years ago from American Southwest

I often wonder how anyone can properly count "unemployment". I don't know of anyone who is actually unemployed at the moment, but we have many friends who are in a similar situation to our own.

I would like to be employed as just a housewife and mother, but am working half- to full-time (over the Internet for an Australian company) because it is easier for me to find a job than my husband, whose construction-industry business is currently just barely paying for the lease on the machines.

Meanwhile, my husband is officially a business owner, but is spending more than full-time trying to find a job and/or start up a service business. I think we would look to statisticians like two full-time workers, but actually we are together bringing in something like 2/3 of my husband's 2008 salary.

This is also affecting extended family of the retired generation, who have lent us money on very generous terms, on the assumption we would pay it back very quickly, and we are doing it at a rate they may not live to see the end of.

So that is what life is like for two "employed" adults economically, and much more could be said about the short and long term societal effects of the wife being the breadwinner.


jdmanista profile image

jdmanista 4 years ago from Ladera Ranch, CA

Chuck, thank you for the hub and the time that it took you to properly research these figures. As to your first points about how many people are unemployed or underemployed it really bothers me that politicians are able to use any figure that suits their purpose at that particular moment. Because of the multiple unemployment stats thats are currently available the President is able to claim that he has been able to lower unemployment to 8.2% by creating (or saving) millions of jobs. Due to the fact that no one can actually substantiate these claims we have to somewhat take his word for it. However, the fact is that true unemployment (U-6) is almost 15% and employment participation is the lowest is has been since the early 80's (around 63% I believe). These facts simply go to your point and are something that everyone is the country should be aware of.

As far as social security I don't think that there is anyone that would argue that we have to make drastic changes to this system. When it was originally created this system was not meant to be used as a retirement plan and most people were not even expected to live to the retirment age. Now the average person lives into their 70's and many are living to 80 or 90. This system has become another welfare crutch for so many and most of us that are currently paying into this system will probably never see a dollar from it. If we keep with the original premise of this system the age to enter into Social Security should probably be raised to about 79 years old for those who are entering into the work force. However, I am in the camp that believes that the system should be completely reformed and that individuals should have the choice as to how their money is used and can basically be entered into a 401(k)-type system.

And as to your final point I completely agree that Obama is going down the same path of failed governance that was used during the Great Depression. Progressives have perverted our education system so much that there are generations of people that are being raised to believe that the Liberal actions behind the New Deal actually brought us out of the Great Depression. In 1905 poet/philosopher George Santayana said "Those who do not remember history are doomed to repeat it", and in order to combat this, Progressives have simply rewritten the textbooks. If we do not teach ourselves and our children to read the original sources we are going to allow them to take over this country and we will continue to slide down our current path.

So, as to Obama being reelected having dangerous implications for our future, I believe that it is far beyond the next four years we need to worry about. I think that we could be looking at closer to the next four decades being affected by another four years of this current presidency. And, realistically, we need to go far beyond the white house if we want any chance of turning this country around and taking it back toward that conservative system in which it was created. These elections will go a long way toward helping but we need to do so much more to get back to the Founders or a double-dip recession will be the least of our worries.


scottwkelley profile image

scottwkelley 4 years ago from Petoskey, Michigan

Is there a solution? Let me ask the question..If I was President I would _________!

Many people want to blame rather than looking at the process of the program. This started many years ago well before Bush. I myself started asking questions years ago only to find it falling on deaf ears who did not care to listen. I prepared for this day and for the worst to come. This is not over and will continue as long as we let it. It is just not one thing either, it is many which makes the task even more daunting. As Americans vote again this November we must look at our own voting record at the out comes. Maybe then we will learn from our own mistakes of who we elect. Before a person is hired they are examined through many processes and we don't even start with a back ground check, a resume and a panel of human resources to make sure we hire the right person for the job. So, if you were president how would you lead this country?


Tom Koecke profile image

Tom Koecke 4 years ago from Tacoma, Washington

After the New Deal took effect, unemployment dropped from 24.9% in 1933 to a low of 14.3% in 1937. Also, the GDP rose every year except 1938. Another factor in the Great Depression was the dustbowl.

The problem with citing the policy of government purchases not reducing unemployment are further negated by the fact that WWII era purchases that virtually eliminated unemployment were made by the government, and the employment by the military to fight the war.

I try to look at things from more than one point of view. There are many who claim Bush ruined the economy, and point to the drop in the market after the discovery of cooked books. It was not his fault that those were discovered during his administration, and anybody who thinks past political parties has to recognize that it also meant the economy was not as vibrant during the Clinton administration as it appeared to be.

That said, there are many people today who point to the economy and blame Obama as if anything is better. Romney's business exported jobs, which is one of the problems with unemployment in this country.

Reagan put forth that money not paid in taxes by the rich would "trickle down" to the working class in the form of wages. His policies spurred the economy, but also created the need to bail out Savings and Loans corporations and arbitraging.

Businesses operate without morals and ethics. They operate for profits. That is not a bad thing; it is the way it is supposed to be. The solution, then, does not lie in morals and ethics. It lies in making it more profitable to employ Americans than to outsource jobs. It really is that simple. Despite it being that simple, however, the problem is complex, and so must the solution be complex or else we just continue to kid ourselves that one small change here or there will make a significant difference elsewhere.

The biggest problem facing this country today is not unemployment or taxes. It is that society is becoming more and more polarized, perhaps the most polarized since the Civil War. That, too, was based in class warfare.


Chuck profile image

Chuck 4 years ago from Tucson, Arizona Author

Tom Koecke - first of all thanks for catching my error on the zeros. That has been corrected.

My point about taxes and spending is that, if the economy were growing and businesses able to hire more people, a good portion of the 15.2 million people who are currently out of work and are available to work, would again have incomes and pay taxes. This addition of 15.2 million more taxpayers would be an increase in government revenue. Also, since these people are currently unemployed with no income the government has to provide extra services for them which costs money. Once they are working these people would not need the extra services and this would result in a savings for the government.

As to Social Security, your comment "kicked the neediest off social security and medical aid, we could solve the problem." totally misses the point as I was referring to both the loss of Social Security taxes as a result of so many people losing their jobs (and only wage earners and their employers pay Social Security taxes - so no work means no wages and no tax due from the individual or employer) and this has led to the Social Security program going into deficit 6 years earlier than projected.

In addition to the loss of Social Security taxes, many of these people who were 62 years old or older were forced to start taking Social Security earlier. This also put a strain on the system but, for them it has also meant a permanent reduction in their monthly Social Security checks. In addition to the reduction in their monthly Social Security income, the early retirement also further limits their ability to go back to work until they reach full retirement age (65 or 66 years old depending upon when they were born) as they will have their monthly Social Security checks reduced by $1 for every $2 earned in excess of $14,640 during any year in which they work before full retirement age.

My overall point was that Franklin Roosevelt's policies resulted in the Great Depression continuing for his entire time in office. Yes, things did stabilize a bit and there was some job growth but, except for the war years, I believe that unemployment never dropped below 20%. By following the same policies as FDR, President Obama has prolonged the 2007-2008 downturn and threatens to continue it for at least another four years if he is reelected.


Chuck profile image

Chuck 4 years ago from Tucson, Arizona Author

Ghost32 - Thanks for your comments. As to not seeing it immediately, in order to keep the spam down, I have my settings set to moderate comments which means that I have to approve each one before it is available for others to view.

You should be able to see you original comment now.


Ghost32 4 years ago

Odd. I posted a (highly complimentary) comment, came back around...and it's gone!


Ghost32 4 years ago

Good work, Chuck, especially the explanation of how tax revenues have been impacted by the continuing high unemployment levels. I'm one of those who took early retirement by necessity, but fortunately it was only a few MONTHS early and fell within my "full retirement" year...so I didn't get dinged. Had I been even one year younger when my trucking job got Obamafied in early 2009, though, I would have (been dinged).

Voted Up and More and...

Remember in November!


Tom Koecke profile image

Tom Koecke 4 years ago from Tacoma, Washington

Dang, with all this deficit, it seems to me if we cut taxes for the richest, and kicked the neediest off social security and medical aid, we could solve the problem.

Of course, we'd probably need to raise taxes eventually since the new cottage industry would be prisons to house all the people who begin stealing to defy the human instinct of eating to survive.

Just as a note, the numbers you wrote out have three extra zeroes. 15.2 million is 15,200,000.

Is your point that the other guy is good because this one is bad? Your hub seems to lack a solution for the problem you present.


Josak profile image

Josak 4 years ago from variable

So FDR the second most loved president in American history, was responsible for the depression even though the economy grew under FDR and unemployment fell a lot because Obama has not massively reduced unemployment (it as fallen a bit) despite the fact that it skyrocketed under another president...

But somehow the countries that are recovering and growing are ones that have more social responsibility in the vein of the New Deal than the US...

Not the most convincing theory.

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