Even if Congress passes entire Obama jobs plan, economists say high jobless rate will linger

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From the AP via ABC News:


"Even if Congress heeds President Barack Obama's demands to "pass this bill right away" and enacts his jobs and tax plan in its entirety, the unemployment rate probably still would hover in nosebleed territory for at least three more years.

Why? Because the 1.9 million new jobs the White House says the bill would produce in 2012 falls short of what's needed to put the economy back on track to return to pre-recession jobless levels of under 6 percent, from today's rate of 9.1 percent.

That's how deep the jobs hole is.

The persistent weakness of the U.S. economy has left 14 million people unemployed and more than 25 million unable to find full-time work..."

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      BUT WAIT, THERE'S MORE!
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Burned before by making overly optimistic job-creation predictions, the White House turned to prominent outside economists to crunch the numbers.

The projection of 1.9 million new jobs, a 1 percentage point drop in the unemployment rate and a 2 percentage point increase in the gross domestic product under Obama's plan came from Mark Zandi, chief economist of Moody's Analytics.

But Zandi said in an interview his forecast also is based on an assumption that "the president's entire package is passed by the end of the year," a slim prospect given the current divided leadership in Congress, and that there are no other budgetary policy changes.

"I assumed that it would be paid for," Zandi said. "I didn't know when I did that simulation how the president proposed to pay for it."...

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      HE "DIDN'T KNOW."    HOLD ON, THERE'S MORE!  
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But there is one feature Obama doesn't emphasize.

Zandi said his job-creation figure only applies to 2012.

"Beginning in 2013, and certainly into 2014, the plan is a drag on the economy because the stimulus starts fading away," he said. "So by 2015, the economy is in the same place as now, as if there were no jobs package."


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      AFTER THE ELECTION, "THE PLAN IS A DRAG ON THE ECONOMY."
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Job creation has ground to a virtual standstill. The economy produced a scant 20,000 net new jobs in June, 85,000 in July and none in August. Economic output, as measured by the GDP, has been growing this year at an anemic annual rate below 1 percent.

The global economy is showing no signs of strengthening. A divided Federal Reserve is nearly out of ammunition for additional stimulus. And the U.S. is once again facing the possibility of a government shutdown at the end of next week....

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       SO, THE WHITE HOUSE HAS NO ANSWERS EXCEPT MORE SPENDING.
       WHO WOULD DESCRIBE THIS AS LEADERSHIP?

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Link: http://abcnews.go.com/Politics/wireStory/obama-plan-make-small-dent-jobless-rate-14596098