Originally posted on January 8, 2010.
Today, the Labor Department reported that 85,000 jobs were lost in December. In addition, a significant amount of the unemployed have simply lost hope and stopped looking for employment.
Looking back to the beginning of 2009, the Obama administration insisted that Congress urgently pass the $787 billion stimulus plan in order to save American jobs. The American people were told that this massive stimulus plan would reverse economic downturn and ensure that the unemployment rate stays below 8%. President Obama declared that his plan would “save or create more than 3 million new jobs over the next few years.”
The stimulus package has not lived up to its unrealistic predictions. Doug Holtz-Eakin, former director of the Congressional Budget Office, states:
Workers are spending longer and longer periods in frustrated searches for a job and last month another 843,000 Americans gave up and quit looking altogether. It has been nearly a year since the Obama Administration promised to spend its way to a peak unemployment rate of eight percent. It failed. It’s time to change course and provide opportunities for entrepreneurs, small businesses and more Americans.
The economy continues to be in a downward spiral with higher than expected unemployment rates. Senior Fellow at the Hudson Institute, Diana Furchtgott-Roth analyzes the December job figures, writing:
Yes, the unemployment rate stayed the same, at 10%. But that’s only because the labor force participation rate declined from 64.9% to 64.6%, the lowest since August 1985. This means that more and more Americans are dropping out of the labor force.
Obama’s exorbitant stimulus plan has failed to keep unemployment rates under 8% or create an abundance of new jobs. On the contrary, Obama’s wasteful spending projects are harmful to the economy and will never spur the job growth lowering taxes and freeing the market economy would.