Post-election, U.S. faces catastrophic structural unemployment
Gridlocked government in poor shape to deal with economic risks.
BY Caroline Cakebread | November 12, 2012
Four more years of confusion and gridlock. That was the post-election conclusion of J. Bradford DeLong, Professor of Economics at the University of California Berkeley and keynote speaker at this year’s Investment Innovation Conference, held last week in San Diego, California. According to DeLong, a veteran economist and former advisor to the Clinton Administration, the re-election of U.S. President, Barack Obama, brings the U.S. closer to one of the biggest risks it faces right now: the risk that the cyclical unemployment that has plagued the country in the wake of the 2008 Financial Crisis will quickly turn into structural unemployment that will set the U.S. economy on a dark road ahead.
In this video interview taped the morning after the election, DeLong shares his vision of what structural unemployment would look like, with a huge portion of the U.S. population having lost their jobs and stopped working in 2008. Without a jobs recovery in sight, those jobless will become increasingly isolated from the workforce, depending for the long term on social programs, food stamps and healthcare support. All this represents a significant, continued drag on the U.S. economy.
For DeLong, the election results mean continued gridlock will make it very hard for this government to make decisions to markedly improve the employment picture and, in turn, the U.S. economy. Click on the image to watch the full video.