Futurist, development-policy analyst, and much sought-after consultant, Hazel Henderson is a major player in the global arena. Like her late mentor and friend E. F. Schumacher, she balances an extraordinary intelligence with an equal measure of down-to-earth common sense, which she brings to bear with great effectiveness on the present critical state of human affairs.
“Total non-farm payrolls in May added a meager 69,000 jobs while April’s jobs were revised downward to only 77,000, still insufficient to keep up with population growth. March’s revision from 154,000 to 143,000 was disappointing. The revised 259,000 jobs created in February were added to 275,000 new jobs for January.
The May official unemployment rate rose to 8.2% while the labor force participation rate rose to 63.8%. Gains in healthcare increased by 33,000, while manufacturing added 12,000. Jobs rose 36,000 in transportation and warehousing. The number of unemployed persons rose to 12.7 million, with 830,000 discouraged workers dropped from the rolls, accounting for the slight rise in the official unemployment rate of 8.2%.
2012’s first quarter 2.2% growth of GDP signals an anemic recovery in 2012 and May’s dismal jobs report increased the gloom, as the USA faces continued global uncertainty and unresolved issues in Europe. European leaders, after getting banks to take a 75% haircut on their Greek debt narrowly avoided these write-downs triggering payment on credit default swaps. This is the underlying danger to the euro area, with Greece a minor pawn in this larger game. Even after the ECB began its hefty support of EU banks in December, these banks are hoarding the new cash rather than the hoped-for lending to the real economy. Much uncertainty remains with likely effect on the US economy discussed in Congressional Hearings (Dec. 15 and Dec. 16, 2011) chaired by Patrick T. McHenry (R-NC).
The global recovery has weakened, leaving unemployment at unacceptable levels and that tensions in financial markets have increased and commodity price swings have put growth at risk. Nowhere in the G-20’s deliberations was there any definition of “growth” although it was mentioned 8 times in the final Communiqué. Yet mis-measurement of “growth” perpetuated by GDP still causes mis-pricing of sovereign bonds, energy, food and most goods due to externalizing of social and environmental costs and business models still based on “profits” based on passing on such unrecorded costs to taxpayers and future generations.
I welcome the Communiqué’s recognition of the 20 too-big-to-fail banks; the need to curb commodity speculation; examine high-frequency trading and the now widespread support for global financial transaction taxes (“FTT: The Commonsense Approach”), as well as phasing out subsidies on fossil fuels, which still unfairly compete against the cleaner, renewable energy companies in the green economy (see the Green Transition Scoreboard®).
While US stock markets wobbled, deep structural problems in the US economy remain: millions of expected foreclosures, 25% of all mortgages still under water, still-falling house prices, while the US Treasury is failing to use its mandate to help homeowners as explained by Ethical Markets expert Sarah Stranahan. All this is reflected in the Occupy Wall Street protests still spreading across the country and world wide. The debacles at JP Morgan Chase reinforced the need for higher capital reserves and deeper reforms at the TBTF banks as I and D. Wayne Silby, founder of the Calvert Group remark in our “End TBTF: Some Skin Please!”
2012 launched money-saturated Republican primary campaigns for the presidential election and increasingly mindless skirmishes in Congress over extending the payroll tax holiday and unemployment insurance. The jobs bill of the Obama administration is encountering Republican resistance while markets push the Fed for even more easing. Bi-partisan passage of the Jumpstart Our Business Startups (JOBS Act) which was devised to democratize access to capital through crowdfunding on websites by small investors was marred by Wall Street lobbyists.
Jobs, while trending upward, are still key in the sluggish economy, plagued by foreclosures. Cutbacks in the US Postal Service of 5,000 people in November lead to a new debate to relieve it from onerous financial burdens imposed by Congress in 2006. Without these burdens, the US Postal Service actually shows a profit and is up-dating its services. Many groups support allowing the Post Office to expand its services to include savings accounts as in many OECD countries. Government job losses in 2011 totaled 1.9 million. The official unemployment rate is 8.2% partly because of people who were dropped out of the official labor force – leaving the long-term unemployed up at 5.4 million.