The rest of the article can be found here.New York City Mayor Michael Bloomberg warned yesterday if the national jobs crisis doesn’t end soon, the United States would see riots in the streets.
“We have a lot of kids graduating college, can’t find jobs,” Bloomberg said on his radio show. “That’s what happened in Cairo. That’s what happened in Madrid. You don’t want those kinds of riots here.”
Thomas Kochan, a professor at MIT’s Sloan School of Management, agreed with Bloomberg’s assessment.
“There’s so much frustration at the lack of jobs,” Kochan said. “I’m surprised there aren’t more visible signs of anger already. The American public is very tolerant and not prone toward civil unrest, but we’re living on borrowed time with this economy.”
And the hits keep coming — yesterday the Federal Reserve released a report saying U.S. household income fell for the first time in a year, dropping .3 percent to $58.5 trillion. Earlier this week, the Census Bureau put the U.S. poverty rate at 15.1 percent, the highest since 1993. And the national unemployment rate held steady at 9.1 percent as the U.S. added zero jobs in August.
Judging from the recovery rates of various financial crises (South Sea Bubble 1720, Panic of 1819, Panic of 1837, Panic of 1873, Panic of 1907, The Great Depression, Japanese Asset Bubble, and the current global financial crisis), it will take quite a bit of time for the labor market to fully recover. In my opinion, a great deal of people on both sides of the spectrum purposefully forget this phenomenon because this country has been 80 years removed from our last true financial crisis. When the political opposition does not adapt ones preferred policy, there is general outrage and contempt without the slighest consideration about the nature of economic and financial recoveries.
That is why it is imperative that Washington D.C. picks up the investment slack until the private sector is ready and willing to be the driving force of national investment. Tax cuts and perpetual unemployment insurance does not address the long term; and has been unable to provide the economy anything except temporary relief. I also believe that the president is making a huge mistake by attempting to reach across the isle by including various tax incentives. No American in the position to create jobs does so at the whim of personal income tax rates.
On the contrary, political grandstanding with a tumultuous labor market will lead to increased public support for President Obama. "Jobless riots" have the ability to pressure Republicans to act accordingly if they have any desire to be a part of the political process going forward from 2013.