What Bernanke should tell Congress but won't

02/24/2010 12:15 pm EST


Jim Jubak

Founder and Editor, JubakPicks.com

According to forecasts by the Federal Reserve, U.S. unemployment will stand at a horrendous 9.5% at the end of 2010. That’s just about where unemployment stands today at 9.7%.

So I certainly understand why U.S. Senators and Representatives will want to hear from Fed chairman Ben Bernanke on the issue when he testifies in front of the House and Senate today and tomorrow, February 24 and 25.

And I’m sure that some member of Congress will ask Bernanke what the Fed intends to do about unemployment.

I’m betting that Bernanke won’t blow his top at the question but I sure wish he would.

An honest response would run along the lines of “What are we going to do about unemployment? Hey, what are you going to do about unemployment? Do you think the bill that the Senate just passed, the one you’re all so busy praising as a rebirth of responsible bipartisanship, is anything other than a bad joke on the American people? $15 billion in a Social Security payroll tax holiday to companies that hire workers that have been jobless for at least 60 days? That’s your solution for a $14.3 trillion economy where the Great Recession put 8 million people out of work? I thought the House bill at $154 billion was too small. But $15 billion?”

Bernanke could say that and more. The $15 billion bill would give companies a $1,000 per worker bonus if a new hire stays for a year. But it would not extend the current subsidy COBRA health insurance subsidy for workers who have lost their health insurance when they lost their jobs. (That program is due to expire on February 28.) It would not extend unemployment benefits for millions of workers facing an end to their benefits because they’ve been unemployed for too long. And it would not give any aid to states that are about to layoff tens of thousands of workers because of state budget shortfalls. And it won’t provide a significant amount of money to infrastructure projects.

The estimates I’ve seen from economists say that, at best, the Senate bill might create 200,000 to 250,000 jobs.

Okay, if you think the Federal government shouldn’t be in the business of jobs creation or is supposed to stay on the sidelines in what amounts of an economic crisis for millions of unemployed and their families, just say so. And reap the reward from voters who agree with your position or take the heat. Fair enough.

But please don’t pretend you think government should be doing this job when you’re doing everything you can to make sure that the part of government you belong to is doing just about nothing. There’s enough blame to spread around both parties. After all if almost all Republicans voted against the $15 billion Senate bill, the larger House effort just squeaked through a chamber dominated by Democrats.

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