American Sauce: Why aren't there more jobs?
August 30th, 2011
07:00 AM ET
3 years ago

American Sauce: Why aren't there more jobs?

Washington (CNN) – Forget hurricanes and earthquakes, the most lasting American disaster remains the jobs crisis.

This week, American Sauce asks two questions: Why are jobs still comatose? And does the unemployment rate truly capture the scope of the problem?

Hint: government and politicians are lynchpins in both.

Comment below. Or keep reading for more.

Why aren't jobs recovering yet?

Paul LaMonica, assistant managing editor of CNN Money, points to two reasons: big business and small business.

First big businesses, many of which LaMonica says are sitting on piles of cash that could be used to hire.

Instead, those companies are freezing in uncertainty.

"They're worried about consumers not spending," LaMonica said, "and they're also worried about the ineptitude of Washington these days."

The second issue: small businesses. In contrast to large companies, LaMonica's analysis is that small businesses do not have the cash or flexibility to hire right now. Their margins are too close and any expansion, if only a single employee, could risk the entire business.

What is the solution?

LaMonica points to one answer he hears from economists: targeted stimulus.

"Not just throwing money at a wall," he clarified, "but stimulus geared toward education, high-tech, things of that nature could help the job market."

The problem? "Stimulus" has become a politically dirty word.

"It all comes down to the deficit right now," LaMonica said, "we have a political environment...where everyone is focused on getting the debt situation in the U.S. in order."

Not that the deficit can be ignored.

"Make no mistake, that's extremely important," LaMonica put forth, "But at the same token... it's going to do little good to the U.S. if we cut the deficit, get spending down, but then we have little growth."

Listen to more, including our idea for a deficit vs. jobs faceoff, in this week's podcast.

You can also listen to American Sauce on iTunes, Stitcher or subscribe to the podcast via RSS.

– CNN's Dan Szematowicz and Emma Lacey-Bordeaux contributed to this report.


Filed under: American Sauce • Economy • Jobs
soundoff (24 Responses)
  1. Diana

    It is simple.
    The manufacturing jobs have gone overseas to where labor is cheap.
    Now people wonder where the jobs are?

    August 30, 2011 07:13 am at 7:13 am |
  2. MaryM5

    Because the alot of American jobs were sent OVERSEAS.

    August 30, 2011 07:15 am at 7:15 am |
  3. Switters

    There has been TAX CUT after TAX CUT after TAX CUT for the 'job creators' – where are the jobs....?

    August 30, 2011 07:26 am at 7:26 am |
  4. Sandy

    Bull! These companies are creating their own uncertainty! They worry about demand, but there won't be demand if they don't give people JOBS! People can't buy their products if they don't have jobs. Start hiring people and the demand will come when they have money to spend.

    August 30, 2011 07:27 am at 7:27 am |
  5. bb

    Two reasons: Yes, it is true, big corporations are sitting on piles of cash while operating with a skeleton crew of a labor force. And two: middle class jobs have been outsourced for going on two decades now. Entire industries are non-existent here now. We can see what once was our middle class being formed in emerging countries that never did have middle classes before. They not only got our middle class, they also got our country's demand for goods & services. Ironic, but devastating at the same time, that corporations opted for the short-term quick buck by outsourcing, yet obliterated their own long-term domestic demand for their goods they sell.

    August 30, 2011 07:27 am at 7:27 am |
  6. diridi

    who said there are no more jobs, I say, yes, there are jobs, but they are in India, and China, lately Philippines. GOP and Tea Party thugs are sending all the jobs overseas for "Cheap Labor". GE who evaded taxes here in America is opening up its X-Ray plant in China, and Ford is opening its Second Plant in "India". While Toyota is making cars in South Carolina, and Georgia, our greedy is going to overseas. o.k, America, it is your karma, that's it....

    August 30, 2011 07:48 am at 7:48 am |
  7. A True Centrist

    The problem is that we already passed an $800 billion stimulus that failed miserably. President Obama claimed unemployment wouldn't hit 8% if it passed, he claimed there were "shovel ready" jobs just waiting for the influx of cash. Instead, billions were spent on "green jobs" that didn't pan out, government infrastructure jobs that not suprisingly were ridden with fraud and road signs that were not needed.

    Let's be serious...big businesses in the US are sitting on cash (with some estimating over a $1 trillion) because we have an anti-business President and Senate. It's that simple. Do I want to give the farm to big business....no, but at this point with the economy the way it is, it's time to incentivize companies to hire and not dissuade them with tax hikes, more regulations and more government intervention. If the government is now dictating where companies have to operate within the US (because our current admin is in the pockets of the unions), why would they either stay here or move here?

    August 30, 2011 08:21 am at 8:21 am |
  8. Ray E. Georgia

    Well,
    There are jobs. People just don't want to pick fruit or vegetables. Business is sitting on what, 2 Trillion in cash? So they hire people and soon that is gone. Then what? Time for people to try picking fruit and vegtables.

    August 30, 2011 08:37 am at 8:37 am |
  9. J

    Target some stimulus to me in the form of a credit card and I'll put it into the economy!

    August 30, 2011 08:43 am at 8:43 am |
  10. Anita King

    Our fealess leaders and Big Corporations have been sending jobs overseas and setting foreigners up in business in the United States for 20 years. Why is it so hard to figure out that the jobs are gone> BRING our Jobs back to America. Take care America first!!

    August 30, 2011 08:44 am at 8:44 am |
  11. Rick McDaniel

    Simple.

    The jobs went off shore. If we want them back, Congress has to penalize Corporate America, in the form of taxes, to make producing off shore, as expensive as producing on shore.

    Does Congress have the guts to do that? Probably NOT!

    August 30, 2011 09:08 am at 9:08 am |
  12. Elaine

    The Republican party is obsessed with spending cuts, even in the face of experts saying that they won't fix the economy.For them, ideology trumps everything.They have tossed aside objective facts , and made up their own set of facts to support their position; and it is destructive to our economy.Economists across the spectrum say that we need stimulus to turn the economy around; and most of them think that President Obama had the right idea when he did the Stimulus the last time around, but it just wasn't large enough.It didn't create as many jobs as hoped for, but it helped keep states afloat, saved a lot of jobs , and prevented us from having even more people out of work.Boosting the economy and fixing the deficit is a balancing act; but Republicans are only interested in the deficit side of the equation, due to ideology.

    August 30, 2011 09:15 am at 9:15 am |
  13. WiredweirdinSF

    You just can't give trillions of dollars to corrupt union bosses and left wing nuts and think that they will create jobs.. The money will be stolen and used to reelect corrupt, union toady democrat liberal politicians and presidents. The stimuli and TARP were nothing but kickbacks for stealing the 2008 election for the most incompetent, inept, corrupt president this country has ever had.

    August 30, 2011 09:18 am at 9:18 am |
  14. The Greedy Old PIgs have declared class war on US!

    The problem is that too many rightwing extremist idiots ignore that the stimulative effects of Keynesian economics is a proven SUCCESS and that tax cuts for the ultrarich and deregulation are proven FAILURES. As they say, those who fail to learn the lessons of history are doomed to repeat them. The GOBPbaggers are hell-bent on making America fail.

    August 30, 2011 09:22 am at 9:22 am |
  15. SuperD

    You put this right at the feet of the Obama Administration. Kensian Economic policy (stupid and a failure), more regulations, Obamacare, CRA housing crisis. Why on earth would any sane business person even attempt to hire or expand?

    Let's face it, when you're learching towards Socialism, the business community must be defeated because they stand in the way of individual freedom and are a big kink in the drive towards income redistribution.

    It would be nice if American Sauce asked the question, "why is the Democrat party ruled by Marxists, Socialists and Unionists?"

    August 30, 2011 09:34 am at 9:34 am |
  16. Bisqueen23

    Big business is frozen with uncertainty? Really? These huge corporations have made unprecedented fortunes during this time of uncertaintly. No, the problem is these corporations want additional blackmail payments and tax giveaways from the citizens of the United States and in return they will throw out a few jobs.

    August 30, 2011 09:37 am at 9:37 am |
  17. Rudy NYC

    Any legitimate economist with half a brain stroke knows that the way to get out of a recession is to increase spending, which creates demand, which creates jobs. Spending come from 3 major sources; consumers, businesses, and government. Both consumers and businesses have stopped spending, which leaves the government. When the "spender of last resort", the government stops spending then economic decline is sure to follow. All economists learned this in Econ 101.

    August 30, 2011 09:48 am at 9:48 am |
  18. mikenola

    it always amazes me when the analysis comes down to "corporate uncertainty" and then one group or another works diligently to make that uncertainty grow.

    Businesses have grown to think that they are the entitled class in the U.S. and SCOTUS has propped that idea up with the Citizens United decision.

    People like Rick Perry continue to insist the Corporations are People and that OTHER people should pay the Corporations taxes. Other people means poor people.

    The facts are plain, the 2012 or 2016 election will be for the WalMart-President of the United States and the Shell-Senator from Texas if things keep going under this assumption that Corporations are People.

    Rick Perry brags that in the last 10 years he has created jobs in Texas, even as he is cutting 120K teaching jobs. What he leaves out is the more than half of the jobs created are at minimum wage, have no benefits or future, and are service sector jobs like maids and yard workers.

    he also fails to mention that Texas has the highest rate of unwed teenage pregnancies and high school dropouts. These are the future supporters of this economy and Texas is deliberately dumbing them down. That should work out well for us! '
    My own state is just as bad, we even have a special high school diploma for students deemed too stupid to pass basic math and reading levels.

    Why aren't there more jobs? simple, the Republicans in Washington vowed from the start that Obama would be a 1 Term president and they would refuse to pass anything that would make him look good. They just don't seem to mind sacrificing the economy and peoples lives to make that a reality.

    August 30, 2011 09:52 am at 9:52 am |
  19. S.B. Stein E.B. NJ

    Once we get people working again and reduce the umeployment rate below something like 7%, then we can focus on reducing spending. When people are working and paying taxes, then we can cut the deficit. Now the federal government needs to clairify rules and regulations that will be in effect for the next few year. It also needs to build/rebuild the infrastruction that hasn't been maintained and recently destroyed based on disasters (earthquakes, tornados and hurricanes). That will be a start.

    August 30, 2011 09:53 am at 9:53 am |
  20. Michael MN

    The worse the economy gets – the better chances of a GOP win – The GOP will not help the economy folks

    August 30, 2011 09:58 am at 9:58 am |
  21. joe D'

    There aren't more jobs because those traditionally considered "job creators" have made short-term personal/corporate profit significantly more important than the good of the country or even its macro economy. Reaping benefits of lower tax rates, and sitting on Trillions of dollars in profits... sending jobs overseas... and losing sight of the fact that the U.S. economy is driven by the confidence of the [dwindling] middle class. AND because the country was bankrupted by : OFF THE BOOKS : 2 wars, tax cuts for the most affluent, and the crashing of the economy through unregulated [and unpunished] fraud in the investment community. Just my opinion.

    August 30, 2011 10:00 am at 10:00 am |
  22. In the hunt

    In the broadest sense, it's simple. 1. The Manufacturing of common goods continues to migrate offshore. 2. Big Business and Politicians are too close- read that a(deep pocket lobbyist) b(post political job positions, wait for it...as lobbyist), c(investments, banks, stocks and wall street) and finally, d(pork barrel spending). All that means the politicians have LOTS of things OTHER than John Q public at heart. It's a plan, it's greed, it's capitolism at it's worst and when the huge majority of our "leaders" are in for themselves this is the ONLY direction the country can take. Kinda like the gold rush, only it's our nations solvency. So- National Debt is too high, investments for the average joe is taking a beating, and he ain't spending (those that still have jobs, remember?). There is no palatable fix. Change the system to seperate the politico's from big business, lobbyist and banks (Chase Manhattan Credit Cards at 33% is every loan sharks dream), create a civilian anti-porkbarrel commitee with line item veto power, limit Credit card rates to 8%(this really is killing LOTS of families spending budgets), send more poor kids to college, establish small business grants and WORK WITH THEM to make them sucessful, gradually....GRADUALLY ... it might come back- simple right?

    August 30, 2011 10:09 am at 10:09 am |
  23. kat

    I believe there are jobs out there, maybe not what you're used too, maybe not paying as much, but there are jobs out there, some people are just too proud to come down a notch or two and some people would rather live off the system, whether it's welfare or the ever extended unemployment. When our Nanny state stops some of the handouts, you'll see how fast our country rebounds.

    August 30, 2011 10:14 am at 10:14 am |
  24. Sniffit

    ""Not just throwing money at a wall," he clarified, "but stimulus geared toward education, high-tech, things of that nature could help the job market.""

    Too bad, pal. Even last time the GOP wouldn't let Obama do that and forced the Stimulus to be almost 50% tax cuts, which is, in fact, JUST THROWING MONEY AT A WALL. We won't get anything doen that will actually help the economy and stop the destruction of the middle-class until the GOP is completely out of power. It's that simple. Until their power and influence is destroyed, they are going to insist on tax cuts for the wealthy and corporations, the ruination of societal safety net programs that the middle-class depends on due to the rgeed and avarice of the rich and corporations...programs that helped create the middle-class in the first place and now help prevent its destruction, the abject economic enslavement of the poor (a group they intend to grow by killing the middle-class) and deregulation geared towards shortening our life spans so that we die sooner after our useful labor lives are finished. Enjoy your subsistence wages and the arsenic in your tap water, courtesy of the GOP.

    August 30, 2011 10:14 am at 10:14 am |