To House Republicans, jobs are a minor consideration
It’s fascinating to me how many different ways, and in so many different forums, we see the same basic political narrative playing out.
Last week, for example, Federal Reserve Chairman Ben Bernanke appeared before a House committee about the state of the economy and the Fed’s approach to dealing with the economy. With millions of Americans still unemployed, more than 40 percent of them without jobs for months now, Republicans on the committee hectored Bernanke about paying too much attention to creating jobs, and not enough about fighting inflation. Here’s how the New York Times reported one exchange:
Congress has charged the Fed with two goals, maintaining price stability and maximizing employment; Republicans are concerned that the Fed’s huge efforts to spur job growth will eventually result in unmanageable inflation.
These concerns were heightened last week by the Fed’s publication for the first time of a formal interpretation of its Congressional mandate. The Fed said that it would seek 2 percent annual inflation and try to limit unemployment as much as possible, and that sometimes one goal would be a priority over the other.
“My interpretation is that the Fed is willing to accept higher levels of inflation than your preferred rate in order to chase your unemployment mandate,” said Mr. Ryan. “Is that not what we should interpret out of this?”
Mr. Bernanke responded that the Fed would “not actively seek” to raise inflation but if inflation and unemployment both rose above its targets, it could choose to reduce inflation more slowly in order to reduce unemployment more quickly.
“We are not seeking higher inflation,” Mr. Bernanke said. “We do not want higher inflation and we’re not tolerating higher inflation.”
But Mr. Ryan pressed on, noting this was not a denial.
“I don’t know how else to interpret this — that the result of this balanced approach is that higher-than-preferred inflation may be tolerated,” he said.
(To pre-empt the conspiracy minded, if possible, other media outlets reported it the same way. Here’s Reuters and Forbes telling the same story.)
For the record, the inflation rate for December, the most recent month available, was 0.0 percent. The inflation rate over the last 12 months was a quite reasonable 3.0 percent. Furthermore, as the Times notes, the mandate given to the Federal Reserve by Congress is two-fold: controlling inflation and fighting unemployment. And at the moment, given the relative states of inflation and employment, it does not seem unreasonable to focus more on the employment side than inflation.
Yet House Republicans, despite their claimed focus on “jobs jobs jobs,” berate Bernanke for trying to help working Americans and insist that he instead make capital preservation his priority.
Like I said, it’s amazing how many times this narrative repeats itself these days.
– Jay Bookman
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© 2012 The Atlanta Journal-Constitution
573 comments Add your comment
Jay
February 4th, 2012
9:51 am
And yes, one reason I posted this on a Saturday is to provide refuge from the birther post below.
You’re welcome.
Jay
February 4th, 2012
9:51 am
Oh, and one more thing?
FIRST!
nelson
February 4th, 2012
9:59 am
An upcoming reception and photo op and seat for dinner for President Obama out in Hollywood would cost $38,000.
Another upcoming reception for President Obama and dinner in a private home;cost $71,000 per person.
Now where does all this tie in with Jobs,jobs and jobs?
Will any of the unemployed be there to explain their predicament? I think not. The wealthy will be there, the ones that the President wants to give up there wealth, will that do it?
Tommy Maddox
February 4th, 2012
10:00 am
Perhaps if someone could persuade No-Budget Harry to bring some of those dozens of bills sent up from the House for a vote, maybe something might actually happen on the job front.
dw
February 4th, 2012
10:01 am
They dont give a rats a$$ about creating jobs. Just looking out for the rich and getting the kenyan out of office. Morons
Bryan G.
February 4th, 2012
10:06 am
Jay – Are you quoting the inflation rate that does not include gas and food? Because I imagine the measure that includes them both would make the inflation rate higher than 3.0%.
Jay
February 4th, 2012
10:12 am
So Nelson, in your world:
A. Obama hates wealthy people and wants to confiscate their money, and;
B. Wealthy people are lining up to give Obama money to help him realize his goal of confiscating the rest of their money.
Is that right?
Daedalus
February 4th, 2012
10:13 am
You can toss Mitch McConnell in with the House Republicans. He has said that his number one priority is defeating Obama in 2012…jobs and economic recovery be damned. First things first, return the White House to the GOP, everything else is secondary.
Jay
February 4th, 2012
10:14 am
Bryan, that’s the all-inclusive number:
http://www.bls.gov/news.release/cpi.nr0.htm
JohnnyReb
February 4th, 2012
10:23 am
The House has Obama’s plans in gridlock. The Senate won’t take up Republican bills passed in the House. We have government gridlock. The results, the economy improves. A perfect example of the economy doing better when the government stays out of it.
As to inflation, and please be reminded I’m in the food business, a big reason food is not showing a higher inflation is that manufactuers keep downsizing. The market shows the price on box of cereal has increased only slightly. What it does not show is the contents of the box has reduced by a third. If you drink diet Pepsi, you know what I mean.
Ennis
February 4th, 2012
10:24 am
I am so glad I’m a registered Independant. Have the repubs ever had JOBS as a priority?? Preserving the wealthy has and will always be their mantra. I’m 69 years old and never seen or heard a republican truly look out for the “little” guy. Get over it people.. Everyone knows what each party really stands for. All this campaign bluster is just that, Bluster
AmVet - Read my lips. No unemployment money for the lazy parasites who won't move to India.
February 4th, 2012
10:24 am
Jay, thanks. I am almost astounded (not really!) by the ongoing “debate” in Birtherville downstairs.
Yoiks! What a preposterous exercise in sophistry, would be jurisprudence and arcane hair-splitting!
These folks are truly embarrassing and misguided. And that tawdry clowns like Trumped promote this stupidity is truly sad.
And I would be remiss in not acknowledging (again), that monstrously fun FNM session. I think that in some minor way it is important, as it helps us to revisit those times – via the safe medium of music – and remember where we were, both as a nation and as individuals, and where we are now.
And even though it is still a Ball of Confusion, Rap on brother, rap on.
As for the topic at hand, who knows? In another few decades perhaps the self-destructive fake conservatives – given the stark realities – will actually start acknowledging that the War on the Middle Class hasn’t been such a good Trickle Down idea…
Common Sense isn't very Common
February 4th, 2012
10:32 am
Jay – you have an unfair advantage on being first.
That said, you are correct in the fact that wealth preservation is more important for the repubs. than the unemployed/under employed.
Also Obama isn’t an American citizen, his BC is fake
Ennis
February 4th, 2012
10:33 am
If the guvment’s policy is to reduce unemployment rather than curtail inflation, I’m coming down on the side of unemployment. Lets get this country back to full employment before we tackle inflation. I believe the new people employed will spend their money just getting back on track, rather than running out buying yachts and bling. What say you???
JohnnyReb
February 4th, 2012
10:35 am
The single biggest obstacle to overcome inflation and increase jobs is energy prices. If you are hunting someone to blame, look for the tree huggers. And of course, their hugger in chief.
Uncle Billy
February 4th, 2012
10:36 am
The high inflation of the late 70’s and early ’80s resulted from substantial year over year increases in wages. Wages have been running increases lower than productivity growth for several years and are thus not a contributor to inflation. There is no reason to expect inflation to get out of hand.
Ted
February 4th, 2012
10:40 am
Thx for Forbes link. Much more informative than this piece on the various elements. “…it’s amazing how many times this narrative repeats itself these days” The only narrative that repeats itself is the narrow focus of all the pieces by Bookman.
Paulo977
February 4th, 2012
10:44 am
daedalus First things first, return the White House to the GOP
__________________________
and???? the hidden reason?
Jay
February 4th, 2012
10:44 am
Also, a rare confirmation of actual, real-life voter fraud:
http://www.indystar.com/apps/pbcs.dll/article?AID=2012120203035
JohnnyReb
February 4th, 2012
10:52 am
Jay, you are really reaching to include that guy as an example of commonly referenced voter fraud. If he was voting from the grave you might have a case.
Lord Help Us
February 4th, 2012
10:56 am
Yea Jay, it’s only voter fraud if Dems are the target…
Jay
February 4th, 2012
10:57 am
Well Johnny, in the absence of evidence that people are voting from the grave, that’s as close as we can get, now isn’t it?
Lord Help Us
February 4th, 2012
11:02 am
‘The single biggest obstacle to overcome inflation and increase jobs is energy prices.’
Please reread and understand the state of inflation…nonexistent. One down, one to go…
Now on the issue of energy prices, we could invest more in alternative energy (but who stands in the way of that?) And/or, we could institute higher mpg standards (but who stands in the way of that?)/ And/or, we could invest in more mass transit/rapid rail (but who stands in the way of that?).
Puhleeze…you hate Obama and will justify your hatred with anything you can.
Welcome to the Occupation
February 4th, 2012
11:03 am
Jay it shouldn’t be surprising at all how this dynamic continues to play out. We see its counterpart in Europe as a financial elite continues to extract vicious austerity policies from Greek citizens, with the threat to other struggling member nations being implicit, in return for continued honoring of promised bailout fund. It’s just the flip-side of the same offensive we see by the political establishment here (with Obama and Bernanke playing a moderating role, but still not entirely different in its ultimate goals).
The fact is that there is a fierce offensive world-wide right now — represented in this country most immediately by Rep. Paul Ryan — to see to it that the financial crisis not be exploited as an opportunity to challenge the rule of the financial oligarchy or force it to acknowledge limits to its power and recognize the importance of protecting workers and the middle classes from the fraud and corruption of the kleptocratic gambling financial class that led to the worst financial crash since the Depression. The dismantling of the 20th C safety net that grew out of the New Deal social contract MUST NOT be allowed to be reversed at this critical point when everything’s up for grabs, when potentially many future decades of policy is at stake. It’s make or break for them. The crisis cannot be allowed to go to waste. Thus ALL of our financial woes (which they secretly welcome) must be painted in the light of overspending and indebtedness, thus justifying austerity policies.
They will fight tooth and nail for that agenda.
Bruno
February 4th, 2012
11:04 am
I’m 69 years old and never seen or heard a republican truly look out for the “little” guy.
Ennis–As a 69 year old, you’re likely on a fixed income. In case you didn’t realize it, the Republicans ARE looking out for you by expressing concern about inflation, since inflation impacts those who are on a fixed income the most.
Jay–Though your “populist” message seems to be playing well with your non-thinking base, nothing stands alone in this world. Competing interests must be balanced, and intelligent people realize that. There has been concern expressed about runaway inflation for a while now, so it isn’t coming out of left field and isn’t strictly a political ploy. With a little thought, you would realize that rampant inflation offsets any real wage gains. Both problems are important.
Lord Help Us
February 4th, 2012
11:06 am
‘With a little thought, you would realize that rampant inflation offsets any real wage gains. Both problems are important.’
Except that inflation is currently nonexistent…
Jack
February 4th, 2012
11:07 am
I suppose Bookman would recommend more shovel ready jobs. Jobs will be created when the housing industry recovers and that’ll be awhile. And we all know what happened to the housing industry.
Lord Help Us
February 4th, 2012
11:09 am
Bruno, would you be in favor of tax rate hikes on people making more that $250k a year to help shore up the budget deficit and also help stave off the coming ‘runaway inflation?’
Lord Help Us
February 4th, 2012
11:09 am
‘And we all know what happened to the housing industry.’
Oh please do tell your version of this…can’t wait…
Bruno
February 4th, 2012
11:10 am
LHU–Jay stated above that inflation was 3% last year. Not bad, but not great either. So how high are you willing to go?? 7%, 10% or 12%??
Bruno
February 4th, 2012
11:13 am
Bruno, would you be in favor of tax rate hikes on people making more that $250k a year to help shore up the budget deficit and also help stave off the coming ‘runaway inflation?’
Any tax increases need to be shared by all. Your “soak the rich” schemes don’t reflect well on you.
Lord Help Us
February 4th, 2012
11:13 am
Bruno, is ‘runaway inflation’ a problem. No. Could it be at some point? Yes.
What policy change do you propose to address this currently nonexistent problem?
Adam
February 4th, 2012
11:14 am
Conservatives constantly want to make the economy worse because they have based their entire narrative on how the economy is bad, it’s the economy stupid, etc, therefore don’t vote for Obama or Democrats. The smart ones recognize this won’t hold up to actual public scrutiny, especially if the economy keeps improving and the BLS keeps releasing actual data to prove it.
The dumb ones run against Straw Man Obama instead of the real guy: http://www.youtube.com/watch?v=RtLEPPgbNyM
JohnnyReb
February 4th, 2012
11:14 am
No Jay, I think the examples of petitions with repeated, ficticious, and deceased names is the better example. I’m not defening the guy, he broke the law. But the Left’s continued insistence on presenting ID being a breach of constitutional rights is ridiculous in our times.
Jay
February 4th, 2012
11:15 am
Actually, Bruno, a 3 percent inflation rate is just about perfect, according to economists.
JohnnyReb
February 4th, 2012
11:15 am
Occupation – have you seen the story on Occupy a Golf Course?
Lord Help Us
February 4th, 2012
11:16 am
‘Your “soak the rich” schemes don’t reflect well on you.’
fyi, and not that it’s any of your business, but I am one of those ‘rich’ that would be ’soaked.’ Although Warren B and I do not gather in the same social circles, we share this policy.
Adam
February 4th, 2012
11:16 am
Bruno: And he’s coming for your guns too! The first term was just an elaborate ruse!
0311/1811
February 4th, 2012
11:17 am
JAY:
“And yes, one reason I posted this on a Saturday is to provide refuge from the birther post below.
You’re welcome.”
I could be wrong but I believe in the not too distant past you said you would “never” allow another discussion on the birther issue.
Yet twice this week ………………………………..
Adam
February 4th, 2012
11:17 am
JohnnyReb: There is no evidence of dead people voting. Despite attempts to “prove” this, no proof has actually surfaced. I guess your Republican representatives are just doing a half-assed job of investigating?
Doggone/GA
February 4th, 2012
11:17 am
“But the Left’s continued insistence on presenting ID being a breach of constitutional rights is ridiculous in our times”
I see. Like Bruno you are demanding a solution to a currently non-existent problem.
Adam
February 4th, 2012
11:19 am
I am out for a bit. Have fun in your bubble, cons!
Recon 2533 1811
February 4th, 2012
11:20 am
Inflation? gasoline prices, food prices, health care…what inflation? Unemployment? what about the thousands of under employed and those who’ve just given up? Oh yes, happy days are here again.
Lord Help Us
February 4th, 2012
11:20 am
‘But the Left’s continued insistence on presenting ID being a breach of constitutional rights is ridiculous in our times.’
JR, if you see the GOP focus on voter fraud as anything more than an attempt to suppress votes that do not go their way, you are a fool…
If you see it otherwise, find some evidence of elections that turned on VERIFIED voter fraud.
Welcome to the Occupation
February 4th, 2012
11:20 am
Bruno: “..the Republicans ARE looking out for you by expressing concern about inflation, since inflation impacts those who are on a fixed income the most.”
Puh!! The same interests who are trying to enforce their anti-inflation fanaticism are the same forces trying to viciously gut the 20th Century social program. The person living on a fixed income is most vulnerable to the gutting of pensions and social programs that average people depend on, and this gutting goes HAND IN HAND with this anti-inflation agenda.
If you know anything about post war financial history, you know that the key point of contention between the Keynesians and the post-Keynesians who dominate now and are trying to shore up their dominance for the foreseeable future is over whether employment should be a primary concern of fiscal and monetary policy. For Keynes, it was paramount, but for these people that idea must be ruthlessly suppressed.
“Competing interests must be balanced, and intelligent people realize that”
You’re either cynically lying or you’re just hopeless misinformed, for if you really believed that then you would be defending Mr. Bernanke against these attacks by the financial oligarchs through their mouthpiece Paul Ryan.
It’s obvious that it is these financial interests, the oligarchic interests represented by people like Paul Ryan and Mitt Romney, who are bent on destroying competing interests by trying to bully the Fed to drop any pretense of caring about employment as an equal concern alongside inflation control for monetary policy, vis-a-vis the financial interests who fiercely support tight inflation control.
Jay
February 4th, 2012
11:20 am
I also find this interesting, from the Wall Street Journal:
“WASHINGTON—U.S. companies are booking higher profits than ever. But the number crunchers in Washington are puzzling over a phenomenon that has just come into view: Corporate tax receipts as a share of profits are at their lowest level in at least 40 years.
Total corporate federal taxes paid fell to 12.1% of profits earned from activities within the U.S. in fiscal 2011, which ended Sept. 30, according to the Congressional Budget Office. That’s the lowest level since at least 1972. And well below the 25.6% companies paid on average from 1987 to 2008.
That Obama, he’s such a Marxist….
0311/1811
February 4th, 2012
11:23 am
ARAB WINTER:
“400 SLAUGHTERED IN SYRIA…
12 dead in latest Egypt clashes…
Iran begins new military exercises…
Ayatollah Khamenei threatens Israel…”
On Obama’s watch ……………. just sayin’
Lord Help Us
February 4th, 2012
11:24 am
‘U.S. companies are booking higher profits than ever.’
OMG, but, the UNCERTAINTY…
Doggone/GA
February 4th, 2012
11:25 am
“On Obama’s watch ……………. just sayin’”
And they happened on your watch too. So what are YOU going to do about them?
AmVet - Read my lips. No unemployment money for the lazy parasites who won't move to India.
February 4th, 2012
11:25 am
The single biggest obstacle to overcome inflation and increase jobs is energy prices.
????
There are many causes for inflation, depending on a number of factors.
The government printing excess money/fiscal policy/interest rates, rises in production/raw material costs, decreased competition, international lending and national debts, speculation, exchange rates, pricing strategies, natural catastrophes and socioeconomic caused disruptions (war) and federal taxes are all involved.