A
good scare from a REPUBLICAN columnist:
Paul Craig Roberts
was Assistant Secretary of the Treasury in the Reagan administration.
He was Associate Editor of the Wall Street Journal editorial
page and Contributing Editor of National Review. He is coauthor
of The Tyranny of Good Intentions.
COMMENTARY:
Nuking
the Economy
Forget
Iran—Americans Should be Hysterical About This
By Paul Craig Roberts
(Baltimore
Chronicle 2-13-06)
In
five years the US economy only created 70,000 jobs in architecture and
engineering, many of which are clerical. Little wonder engineering enrollments
are shrinking. There are no jobs for graduates. The talk about engineering
shortages is absolute ignorance.
Last week the Bureau
of Labor Statistics re-benchmarked the payroll jobs data back to 2000.
Thanks to Charles McMillion of MBG Information Services, I have the
adjusted data from January 2001 through January 2006. If you are worried
about terrorists, you don’t know what worry is.
Job growth over
the last five years is the weakest on record. The US economy came up
more than 7 million jobs short of keeping up with population growth.
That’s one good reason for controlling immigration. An economy that
cannot keep up with population growth should not be boosting population
with heavy rates of legal and illegal immigration.
Over the past five
years the US economy experienced a net job loss in goods-producing activities.
The entire job growth was in service-providing activities--primarily
credit intermediation, health care and social assistance, waiters, waitresses
and bartenders, and state and local government.
Job
growth over the last five years is the weakest on record. The US economy
came up more than 7 million jobs short of keeping up with population
growth.
US manufacturing
lost 2.9 million jobs, almost 17% of the manufacturing work force. The
wipeout is across the board. Not a single manufacturing payroll classification
created a single new job.
The declines in
some manufacturing sectors have more in common with a country undergoing
saturation bombing during war than with a super-economy that is “the
envy of the world.” Communications equipment lost 43% of its workforce.
Semiconductors and electronic components lost 37% of its workforce.
The workforce in computers and electronic products declined 30%. Electrical
equipment and appliances lost 25% of its employees. The workforce in
motor vehicles and parts declined 12%. Furniture and related products
lost 17% of its jobs. Apparel manufacturers lost almost half of the
work force. Employment in textile mills declined 43%. Paper and paper
products lost one-fifth of its jobs. The work force in plastics and
rubber products declined by 15%. Even manufacturers of beverages and
tobacco products experienced a 7% shrinkage in jobs.
The knowledge jobs
that were supposed to take the place of lost manufacturing jobs in the
globalized “new economy” never appeared. The information sector lost
17% of its jobs, with the telecommunications work force declining by
25%. Even wholesale and retail trade lost jobs. Despite massive new
accounting burdens imposed by Sarbanes-Oxley, accounting and bookkeeping
employment shrank by 4%. Computer systems design and related lost 9%
of its jobs. Today there are 209,000 fewer managerial and supervisory
jobs than 5 years ago.
In five years the
US economy only created 70,000 jobs in architecture and engineering,
many of which are clerical. Little wonder engineering enrollments are
shrinking. There are no jobs for graduates. The talk about engineering
shortages is absolute ignorance. There are several hundred thousand
American engineers who are unemployed and have been for years. No student
wants a degree that is nothing but a ticket to a soup line. Many engineers
have written to me that they cannot even get Wal-Mart jobs because their
education makes them over-qualified. Offshore outsourcing and offshore
production have left the US awash with unemployment among the highly
educated. The low measured rate of unemployment does not include discouraged
workers. Labor arbitrage has made the unemployment rate less and less
a meaningful indicator. In the past unemployment resulted mainly from
turnover in the labor force and recession. Recoveries pulled people
back into jobs.
Unemployment benefits
were intended to help people over the down time in the cycle when workers
were laid off. Today the unemployment is permanent, as entire occupations
and industries are wiped out by labor arbitrage as corporations replace
their American employees with foreign ones.
Economists who look
beyond political press releases estimate the US unemployment rate to
be between 7% and 8.5%. There are now hundreds of thousands of Americans
who will never recover their investment in their university education.
Unless the BLS is
falsifying the data or businesses are reporting the opposite of the
facts, the US is experiencing a job depression. Most economists refuse
to acknowledge the facts, because they endorsed globalization. It was
a win-win situation, they said.
They were wrong.
At a time when America
desperately needs the voices of educated people as a counterweight to
the disinformation that emanates from the Bush administration and its
supporters, economists have discredited themselves. This is especially
true for “free market economists” who foolishly assumed that international
labor arbitrage was an example of free trade that was benefitting Americans.
Where is the benefit when employment in US export industries and import-competitive
industries is shrinking? After decades of struggle to regain credibility,
free market economics is on the verge of another wipeout.
No
sane economist can possibly maintain that a deplorable record of merely
1,054,000 net new private sector jobs over five years is an indication
of a healthy economy.
No sane economist
can possibly maintain that a deplorable record of merely 1,054,000 net
new private sector jobs over five years is an indication of a healthy
economy. The total number of private sector jobs created over the five
year period is 500,000 jobs less than one year’s legal and illegal immigration!
(In a December 2005 Center for Immigration Studies report based on the
Census Bureau’s March 2005 Current Population Survey, Steven
Camarota writes that there were 7.9 million new immigrants between January
2000 and March 2005.)
The economics profession
has failed America. It touts a meaningless number while joblessness
soars. Lazy journalists at the New York Times simply rewrite
the Bush administration’s press releases.
On February 10 the
Commerce Department released a record US trade deficit in goods and
services for 2005--$726 billion. The US deficit in Advanced Technology
Products reached a new high. Offshore production for home markets and
jobs outsourcing has made the US highly dependent on foreign provided
goods and services, while simultaneously reducing the export capability
of the US economy. It is possible that there might be no exchange rate
at which the US can balance its trade.
Polls indicate that
the Bush administration is succeeding in whipping up fear and hysteria
about Iran. The secretary of defense is promising Americans decades-long
war. Is death in battle Bush’s solution to the job depression? Will
Asians finance a decades-long war for a bankrupt country?
--------------------------------------------------------------------------------
Roberts can be reached
at: paulcraigroberts@yahoo.com.
This article originally appeared at counterpunch.org
and is published in the Baltimore Chronicle with permission of
the author.
