Re: re: Welfare can't be abolished until unemployment is abolished

[Jim Devine <jdevine@xxxxxxxxxxxxxxx>]

At 09:59 AM 9/7/01 -0700, you wrote:
> The jobless rate climbed to 4.9 percent from 4.5 percent in July, the Labor
> Department said.

that's a big change!

It should be noted that most of the "optimistic" forecasts (those that
predict "recovery" in a few months) also say that unemployment is going to
be 5 or 6 or 7% in the US in 2001.

There's a difference between a workers' recession (rising unemployment
rates) and a official -- bourgeois -- recession (falling real GDP). GDP
just has to slow its growth to cause higher unemployment (since the labor
force and labor productivity both increase over time, which means that real
GDP has to increase to keep the unemployment rate from rising).

In fact, that's what Greenspan wanted: a "soft landing," also known as a
"growth recession" or "worker's recession," in order to prevent
inflationary acceleration (under the NAIRU theory). What happened was that
Greenspan was playing with fire and might have set off a "hard landing," in
which the economy doesn't just punish workers: the economy might spiral out
of control, leading to mass corporate bankruptcies, world depression, etc.

As in the early 1990s, "recovery" might easily be "jobless," i.e., the rate
of growth of real GDP might not be high enough to absorb the increased
labor force and those laid off due to technological/managerial change
(labor productivity growth). [Note that this has nothing to do with the
"disappearance of work" thesis of Aronowitz et al.]

Jim Devine jdevine@xxxxxxx &  http://bellarmine.lmu.edu/~jdevine