Tuesday, June 9, 2009
What a "Jobless Recovery" Really Means: A Massive Redistribution of Wealth from the Little Guy to the Big Boys
The meaning of the phrase jobless recovery itself is simple:
A jobless recovery or jobless growth is a phrase used by economists to describe the recovery from a recession which does not produce strong growth in employment. The phrase originated in the early 1990s in the United States, to describe the economic recovery at the end of President George H.W. Bush's term; it came back into use during the early 2000s.
But what is the deeper meaning of a jobless recovery now?
The government has spent more than $12 trillion dollars responding to the financial crisis. But the overwhelming majority of that money has gone to big banks and big corporations.
The fact that much of the stimulus bill is really pork reduces that number still further. And while Obama might throw more stimulus money into the system, independent experts say that total government spending could rise to $20 trillion dollars, so the percentage might substantially decline.
What these figures show is that the government has given well over 90% of the taxpayers' money to the richest companies and well under 10% for job-creation programs.
Therefore, the "jobless recovery" is really a massive redistribution of wealth from the little guy to the big boys (see this and this).
And even if big companies fire a bunch of employees and so temporarily boost their bottom line in the process, there is no such thing as a "jobless recovery" - as will become apparent after a couple of quarters.