More Questions Than Answers On The Broken Jobs Machine

Jim Tankersley has an article in the NationalJournal which provides an interesting overview of the unemployment conundrum. He paints a picture of an employment market that has been deteriorating over time and not one which was dealt a devastating blow by the Great Recession from which it inexplicably can’t seem to recover.

This isn’t an article that offers up any easy solutions. Rather it points out just how difficult and complicated the road back towards anything approaching meaningful full employment is likely to be as no one is quite sure just what went wrong with the American jobs machine. Given the context that Tankersley provides, it’s hard to see how increases in aggregate demand alone provide the impetus for recovery.

I, at least, also see the potential for real political mischief arising from the current state of affairs. Tankersley points out that politicians are preoccupied with questions of regulation, taxes and deficits, not with the structural reasons which might be contributing to the lack of good job creation. But once they do begin to focus on the issue then facts such as these are going to demand responses:

A recent paper by researchers at the Asian Development Bank Institute concluded that the iPhone, one of the United States’ top innovations of the past decade, actually contributes nearly $2 billion to our trade deficit because it is almost entirely produced and assembled in Asia. The paper also raises a conundrum for lawmakers and business leaders alike: If Apple moved its assembly line to the United States and created domestic jobs but didn’t raise the cost of the iPhone, the company would still turn a 50 percent profit on every one it sold.

Maybe Apple’s greed is at fault. Maybe the government is to blame for not making the industrial climate more hospitable to Apple and other job producers. The harsh reality is that workers, companies, and lawmakers all need to readjust if we ever hope to rev up the job-creation machine again.

It isn’t difficult to imagine where the political class might choose to run with this. Given the antipathy that seems to be building towards China and the pressure that will surely increase from the unemployed sector of the electorate as the 2012 elections near it’s the sort of low hanging fruit that is hard to resist.

Tankersley’s article is discomforting to say the least but one that I strongly recommend you take the time to read.

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