South By North Strategies, Ltd.

Around The Dial – September 1

Economic policy reports, blog postings, and media stories of interest:

• Naked Capitalism stares critically at some Wall St. arguments.
• The Wall Street Journal reports on possible growth policies.
• David Leonhardt explains differences in tax cuts.
• Katrina vanden Heuvel opines on the state of American labor.

North Carolina and The Great Recession

Earlier this week, John Quinterno of South by North Strategies, Ltd. participated in a panel discussion on “The Great Recession” that took place at the UNC-Chapel Hill Department of City and Regional Planning.

Quinterno’s presentation, entitled “North Carolina & The Great Recession: An Overview,” is below.

The Types of Unemployment

Brad DeLong weighs in on the debate over cyclical vs. structural unemployment. His conclusion: cyclical factors currently dominate.

That is what “mismatch” structural unemployment looks like – and it is not what we have today, at least not in Europe and North America. In the past three years, employment in construction has shrunk, but so has employment in manufacturing, wholesale trade, retail trade, transportation and warehousing, information distribution and communications, professional and business services, educational services, leisure and hospitality, and in the public sector. Employment is up in health care, Internet-related businesses, and perhaps in logging and mining.
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In the United States, the past three years have seen employment fall from 137.8 million people in July 2007 to slightly less than 130 million in July 2010 – a decline of 7.9 million during a period in which the adult population grew by six million. What we have witnessed is not a shift in demand into sectors lacking an adequate number of qualified and productive workers, but rather a collapse in the level of aggregate demand.

Around The Dial – August 31

Economic policy reports, blog postings, and media stories of interest:

• The News & Observer argues that “every job counts.”
• Economix notes the “tick up” in state revenue collections.
• Calculated Risk warns against bringing back the home buyer tax credit.
• Ezra Klein blogs about the political views of the deficit commission’s members.
• Robert Reich mentions that cheaper money won’t create jobs.

Nothing to Celebrate

Fed Watch is not encouraged by the economic policy ideas heard coming from Washington.

Bottom Line:  Bernanke’s speech struck me as anything but reassuring.  He made it clear that the Fed’s remaining options were weak and/or less than palatable for policymakers.  With such low ammunition, how can we take seriously his conviction that the Fed will aggressively defend against the threat of deflation that is already upon us?  Simply wait around for the fiscal policy backstop?  Don’t hold your breath – this Administration is about to be on the run; they have already dropped the policy ball, and there will not be a second chance.   We already had a lost decade, and another is upon us.