America needs jobs or the economy will not recover. There are not enough jobs for skilled workers, because there are fewer and fewer industries producing consumer goods. Even lawyers graduating from Harvard and Yale can not find jobs in the major law firms, and are taking jobs in second tier firms, leaving graduates from other schools without prospects of employment.

        Industry needs engineers, but Allan Cotrone, the director of Career Development and Student Affairs at the Ross School of Business, told The Michigan Daily. “I’ve never seen it as bad as this for students looking for jobs,”

        If Obamacare passes it will not be long before tax revenues from medical providers and insurance companies tumbles, and in view of future unsustainable debt, the prospects of government being able to provide what Obama is promising is certainly debatable.

        The N.Y. Times in August 2009 predicted that “Over the next several years, low-wage occupations will add the most jobs.”, and the Obama administration is planning on extending unemployment benefits, but no one is talking about building more industrial plants which will create jobs for workers so that they can afford  housing and healthcare. The Federal Government cannot fix what it has destroyed.

        President Obama is repeating the same mistakes committed by FDR in the last great depression of the 1930’s. Professor Lee E. Ohanian Professor of Economics testified before the U.S. Senate Committee, apparently to no avail:

The New Deal was a collection of policies adopted in response to the Great Depression that were designed to alleviate economic hardship and promote economic recovery. Today’s economic crisis has prompted many comparisons to the Great Depression, and has led many to ask whether a “New” New Deal is warranted. My research shows that some New Deal policies significantly delayed economic recovery by impeding the normal forces of supply and demand, and that the economy would have experienced a robust recovery in the absence of these policies.

The line for food at St. Peter's Mission in N.Y. City is evidence of the failures of the New Deal legislation pushed through by FDR could not provide jobs or food for many Americans.

       Professor Ohanian criticizes government interference in the free-market. The Democrats’ “crisis management policies” impede competition. The misguided policies of the FDR administration illustrate the futility of relying upon the Federal Government to create permanent high-paying jobs.

New Deal Failures:
National Industrial Recovery Act [NIRA],
Tennessee Valley Authority [TVA],
Civil Conservation Corps [CCC],
Agricultural Adjustment Act [AAA],
Relocation Authority [RA],
Works Progress Administration [WPA],
Emergency Farm Mortgage Act [ERMA]
Federal Emergency Relief Act [FERA]
Glass-Stegall Banking Act
National Labor Relations Act [NLRA]
Indian Reorganization Act [IRA]
Rural Electrification Act [REA]
Gold Standard Act of 1934
Walsh-Healy Act
Fair Labor Standards Act [FLSA]
Security and Exchange Commission [SEC]
Social Security Administration [SSA]
Farm Security Administration [FSA]

        I have maintained that under FDR’s “New Deal” plan government stimulus packages robbed the economy of private commercial development, put Commonwealth and Southern power company, one of the largest power producers in the world, out of business and extended the depression for at least a decade. Ohanian writes:

The recovery from the Depression was indeed slow, and this has been recognized by a number of economists, including 1976 Nobel Laureate Milton Friedman (Friedman and Schwartz (1963)), 1995 Nobel Laureate Robert Lucas, (Lucas and Rapping (1972)), and 2004 Nobel Laureate Edward Prescott (1999). My work with Harold Cole (2007) details this slow recovery.

          In addition to national debt creating government programs, FDR increased taxation on corporations, and instituted a higher wage mandate. These temporary “fixes” had a long-term negative effect on labor in general. Employers were forced to lay workers off and reduce hours. According to Ohanian, “This coincidence of high industry wages and low hours worked is one of the most telling signs that the market process was considerably distorted.” In his opinion, the bill that did more to stifle industrial growth was the Wagner Act of 1935. It gave Unions tremendous power over management, which resulted in increasing the costs of consumer goods at a time when Americans were starving.

        Professor Ohanian gives some examples. When the economy faltered in Chile and Mexico, the government of Chile did not prop up failing banks, while Mexico did. The result was that while Chile’s economy suffered greater contraction initially, it recovered sooner and its economy doubled as compared to that of Mexico. Japan’s government also intervened and disrupted free-market forces in the early 1990. That government’s efforts also delayed economic recovery. Ohanian cited two studies, which in his words concluded “that Japan’s policies that kept otherwise insolvent banks operating, and that impeded the flow of capital to efficient firms, significantly prolonged the effect of Japan’s crisis, resulting in a decade-long stagnation of the Japanese economy.” In 1989 the Nikkei stock index in Japan was over 39,000. It is now under 8,000. Due to government intervention the market lost 80% of its value.

        Instead of stimulus packages, Professor Ohanian calls for incentivizing savings, creating incentives for jobs, and promoting competition. Basically this is the conservative approach to saving our economy, and it is being ignored by liberal Democrats. The environmentalist’s argument that it is America’s duty do protect the world from global warming has emaciated U.S. industrial might and has displaced millions of workers. If the object is to create more jobs, according to a 2008 Heritage Foundation study, increasing domestic oil production by one million barrels per day would generate 128,000 jobs. At two million barrels per day, that figure jumps to 270,000. The myth that the U.S. economy can survive on high-tech and service industries has proven to be false.

        Unfortunately the far-left radical fringe has the support of the national media and well financed public and community action groups. Americans have been asleep at the switch for forty years. The Obama administration has two years to complete its radical agenda before it must revert to empty promises, and largess to purchase votes for the next presidential election. Hopefully enough light has been shed on the failed polices of Obama handouts, bailout, stimulus, income redistribution, and a disastrous energy policy that the Democrats will lose control of Congress in the midterm elections.