Economic policy reports, blog postings, and media stories of interest:
One of the more contentious issues surrounding federal recovery efforts is how to measure job creation and retention. In the current context, a job saved arguable is as good as a job created, yet analysts argue over how to measure the number of jobs saved.
In a recent research brief, economist Heather Boushey of the Center for American Progress discusses how to measure the number of jobs saved under the recovery package and how public policy can retain more positions. Concludes Boushey:
Over the past year, policymakers have taken often extraordinary steps to avert economic collapse and to stop the economy from hemorrhaging jobs. That has been successful. But even so, the economy crossed the threshold into double-digit unemployment in October, with unemployment now at 10.2 percent. Employers have slowed the pace of lay-offs—saving somewhere between 1.1 and 1.5 million workers from losing their jobs—but they have yet to begin hiring anew.
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Stepping up policies that focus on job creation will all make a difference in generating job growth in the months to come. These should include filling in the budget gaps for state and local governments so they can avert job losses and maintain necessary services; focusing on direct job creation, especially for younger workers; and continuing investments in our infrastructure development and clean energy economy.
At Grasping Reality with Both Hands, economist Brad DeLong poses an interesting question:
… the Obama administration’s fiscal boost program has also significantly helped the economy: aid to impacted states has been a big win, the jury is still out on the effect of the tax cuts in the stimulus, and the flow of government spending on a whole variety of relatively useful causes is in train and is boosting production and employment in the same way that everyone’s boost to spending boosts production and employment. And the cost of carrying the extra debt incurred is extraordinarily low: $12 billion a year of extra taxes would be enough to finance the fiscal boost program at current interest rates, and for that cost American taxpayers will get an extra $1 trillion of produced goods and services and employment will be higher by about ten million job-years.
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Thus the big valid complaints about policy over the past fourteen months are not that it has run up the national debt and not that it has rewarded the princes of Wall Street, but rather that it has, if anything, been on too small a scale–that we ought to have done more.
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Yet these policies appear, somehow, to be political losers in Washington right now: nobody is proposing to do more along the same lines. This is strange: usually when something works the natural impulse is to do it again.
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So what is going on?
Economic policy reports, blog postings, and media stories of interest:
A new report from the Congressional Research Service summarizes the issues related to the various extensions of unemployment insurance benefits authorized by Congress. With the most recent extension, workers receiving insurance benefits can qualify potentially for four tiers of Extended Unemployment Compensation (EUC).
A key problem is that while Congress has extended benefits, it has not yet reauthorized the larger EUC program, which is set to expire at the end of the year. Explains the report:
There has been some confusion on what the Worker, Homeownership, and Business Assistance Act of 2009, P.L. 111 92, accomplished. P.L. 111-92 expanded benefits available in the EUC08 program. That is, it substantially increased the number of weeks of EUC08 benefits available to individuals; it did not extend the authorization of the program, which currently expires on December 26, 2009. Tier I benefits continue to be up to 20 weeks in duration and tier II benefits are now 14 weeks in duration (compared with 13 previously) and no longer are dependent on a state’s unemployment rate. The new tier III benefit provides up to 13 weeks of EUC08 benefits to those workers in states with an average unemployment rate of 6% or higher. The new tier IV benefit may provide up to an additional 6 weeks of benefits if the state unemployment rate is at least 8.5%; however, at this time tier IV benefits are largely symbolic as few workers will qualify for tier IV before the EUC08 program authorization expires.
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