Though he’s less explicit about the issue than some other observers, Newsweek‘s Robert J. Samuelson highlights in his latest column the impact of economic uncertainty on the current American economy:
The rebound in profits ought to be a good omen. It
frees companies to be more aggressive. They?re sitting on huge cash
reserves: a record $838 billion for industrial companies in the Standard
& Poor?s 500 Index (companies like Apple, Boeing, and Caterpillar)
at the end of March, up 26 percent from a year earlier. ?They have the
wherewithal to do whatever they want?hire, make new investments, raise
dividends, do mergers and acquisitions,? says S&P?s Howard
Silver-blatt. Historically, higher profits lead to higher employment,
says Mark Zandi of Moody?s Economy.com. Except for startups, loss-making
companies don?t generate new jobs.So far, history be damned. The contrast between
revived profits and stunted job growth is stunning. From late 2007 to
late 2009, payroll employment dropped nearly 8.4 million. Since then,
the economy has recovered a scant 11 percent of those lost jobs.
Samuelson examines the role of executive stock options, unions, imports, and immigrants as factors contributing to the lagging job growth.
In a throwaway reference, though, Samuelson names another factor that’s undoubtedly playing a role.
But it?s unclear whether corporate elites were so traumatized by the
crisis that they?ve adopted a bunker mentality. That, as much as
uncertainty over Obama?s policies, is fearsome.
