Robert B. Reich, a co-founder of The American Prospect, is a Professor of Public Policy at the Goldman School of Public Policy at the University of California at Berkeley. His website can be found here and his blog can be found here.
Consumer confidence is dropping like a stone. Mass layoffs are sending chills through an America already shaken by the horror of September 11th. Last week alone, companies announced more than 100,000 layoffs, and there are signs of hundreds of thousands more to come.
I do not believe that it is politically feasible to insulate such huge funds from a
governmental direction," Alan Greenspan told the House Ways and Means
Committee last week, one day after President Clinton proposed investing a
portion of Social Security funds in the stock market.
In previous slowdowns, unemployment has reached 7, 8, 9 percent. But we're nowhere near those levels, and we're not likely to be even if this slowdown slides into a full-fledged recession. So what's going on? Here's a hint. In the old days--that is, before 1990--most Americans held steady jobs with steady pay. As long as you had a job, you could be reasonably certain about how much you'd earn next month or even next year. Unless, of course, a recession came along and you got laid off. So it was all or nothing--a steady job or unemployment.
The big winner in this week's bizarre presidential election is Alan Greenspan, the venerable chairman of the US Federal Reserve Board. Mr Greenspan won because the next president - regardless of whether it is George W Bush or Al Gore - will go into office without authority to do much of anything.
To some, it may appear that the occupant of the White House has great authority simply by virtue of holding the office of president. But in fact, even under the best of circumstances, his authority is tightly circumscribed. He must share power with Congress and must depend on the public's continued support.