Friday, January 15, 2010

Economics With Dante

The following sentence from Charlie Cook’s latest column literally chilled my blood:

“A number of economists expect that unemployment will get worse before it gets better. Even if that prediction is wrong, some analysts estimate that Labor's household employment survey would have to show a net increase of 150,000 jobs a month for 48 straight months for the unemployment rate to drop to just 9 percent.”

Sure, the old axiom of if-economists-are-so-smart-then-why-aren’t-all-of-them-millionares applies here. Plus, no one can concretely predict the future when it comes to the US economy – much less anything else. However, if the numbers above are correct (and Charlie Cook does not have a reputation as a kneejerk alarmist), it means that for the US job market to return to pre-September 2008 levels—say, around five-percent—it would take the better part of a decade’s worth of steady moderate to high-level growth.

And that’s a best-case scenario.

Not to get up on a ledge here, but it stands to reason that if it took roughly a decade (e.g. the Bush years) for the US flop into the economic pit in which it currently resides that it’ll take roughly the same time to get out - regardless of who is president, or which party is in charge of Congress.

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