Nelson Mandela: A life in pictures
Nelson Mandela and his wife Winnie in this undated file picture.
The biggest election news this week won’t be who wins the presidential debate Wednesday night. It will be how many new jobs were created in September, announced Friday morning by the Bureau of Labor Statistics.
Rarely in the history has the monthly employment carried so much political significance. If the payroll survey is significantly more than 96,000 –- the number of new jobs created in August — President Obama can credibly claim the job situation is improving. If significantly fewer than 96,000, Mitt Romney has the more credible claim that the economy isn’t improving.
August’s household survey showed the overall rate of unemployment to be 8.1 percent in August – not bad, relative to previous rates – but that was mainly because so many Americans had stopped looking for work. (You’re deemed “unemployed” only if you don’t have a full-time job and you’re looking for work; if you’ve given up looking, you’re not counted.)
What happened to jobs in August or September – and what will happen in October (announced November 2, just days before Election Day) – have very little to do with what Obama did or didn’t do. Presidents have little to do with month-to-month changes in employment.
What’s more, the rest of the world isn’t cooperating: Much of Europe is in recession because it’s swallowed the “austerity” cool-aide. Japan is still a basket case. And China is slowing considerably.
In addition, Obama has had to grapple with a recalcitrant Republican congress, whose “number one goal,” according to Senate Minority Leader Mitch McConnell, hasn’t been to create more jobs but to make sure Obama doesn’t get a second term.
Still, evidence is accumulating that the U.S. economy has stalled. According to Commerce Department data released late last week, the economy grew at an annualized rate of only 1.3 percent between April and June. That’s down from 2 percent in the first quarter of the year. Consumer spending rose in August just .1 percent, after adjusting for inflation. Orders for durable goods (cars, TVs, other long-lasting manufactured products) dropped 13 percent, the biggest monthly drop in three years. And because incomes grew less than spending, the savings rate dropped to 3.7 percent — the lowest since April.
Consumers say they’re more confident about the future – and that’s a key measure for how they’re likely to vote. But the disturbing reality is paychecks continue to shrink. Disposable income (the money left over after taxes) dropped 0.3 percent after adjusting for inflation. That’s the weakest reading since November.
America is still in the gravitational pull of the Great Recession. That’s because consumer spending is 70 percent of economic activity, and the nation’s vast middle class doesn’t have enough money to get the economy back on track. (The rich spend a much smaller proportion of their incomes, and their savings go around the world to wherever they can summon the highest return.)
Republicans have no answers. To the contrary, Romney’s reverse-Robin Hood economics would shrink the middle class even further, and put a huge burden on the poor.
But the economic policies Obama says he’d like to pursue in his second term aren’t nearly large or bold enough to do the job.
The median wage has been stuck in neutral for decades. Since the 1980s, almost all the gains from economic growth have gone to the top. The stagnation of middle-class wages was first masked by millions of women moving into paid work, thereby propping up household incomes. Then it was masked by massive household borrowing against rising home values.
But the bubble that burst in 2008 has removed both masks. The economy can’t fully recover until the middle class and the poor who aspire to join it have enough income to get it moving. For this to happen, they will need a larger share of the gains from economic growth.
Perhaps the President will be asked Wednesday night for his plan to accomplish this.
Robert Reich, one of the nation’s leading experts on work and the economy, is Chancellor’s Professor of Public Policy at the Goldman School of Public Policy at the University of California at Berkeley. He has served in three national administrations, most recently as secretary of labor under President Bill Clinton. Time Magazine has named him one of the ten most effective cabinet secretaries of the last century. He has written 13 books, including his latest best-seller, “Aftershock: The Next Economy and America’s Future;” “The Work of Nations,” which has been translated into 22 languages; and his newest, an e-book, “Beyond Outrage.” His syndicated columns, television appearances, and public radio commentaries reach millions of people each week. He is also a founding editor of the American Prospect magazine, and Chairman of the citizen’s group Common Cause. His new movie "Inequality for All" is in Theaters. His widely-read blog can be found at www.robertreich.org. More Robert Reich.
Nelson Mandela and his wife Winnie in this undated file picture.
Mandela is accompanied by his former wife Winnie, moments after his release from prison February 11, 1990 after serving 27 years in jail. (Reuters)
In this February, 1990 photo, shortly after his release from 27 years in prison, Nelson Mandela, gives the black power salute to the 120,000 supporters packing Soccer City stadium in Soweto, near Johannesburg. (AP Photo)
Nelson Mandela showed his passport in February 19, 1990, shortly after his release from prison. The South African government authorized an application for himself and his wife Winnie - (Juda Ngwenya / Reuters)
In this July 27, 1991 photo, Cuban President Fidel Castro, and Nelson Mandela gesture during the celebration of the "Day of the Revolution" in Matanzas, Cuba. (AP Photo)
In this July 4, 1993 photo, President Bill Clinton and Nelson Mandela listen during Fourth of July ceremonies in Philadelphia during which Clinton presented the Philadelphia Liberty Medal to the African National Congress president and South African President F.W. de Klerk. (AP Photo/Greg Gibson)
President of the African National Congress Nelson Mandela acknowledges cheers from the crowd as he prepares to unveil the ANC's official election platform in 1994. (AP Photo/David Brauchli)
African National Congress (ANC) leader Nelson Mandela greeted residents of Mmabatho in March 1994, during a visit after the nominal homeland came under South African control following the ousting of the former President Lucas Mangope. (Reuters/Howard Burditt)
South African President Nelson Mandela smiles with actor Sidney Poitier at a press conference in Cape Town in 1996. Poitier played Mandela in the film "One Man, One Vote" (AP Photo / Sasa Kralj)
South African President Nelson Mandela waves to crowds as he sits next to Queen Elizabeth II in a an open carriage on the way to Buckingham Palace.(AP/Louisa Buller)
Chairman of the Constitutional Assembly Cyril Ramaphosa, left, holds up a copy of the country's constitution which was signed by President Nelson Mandela, in December 1996. (AP Photo / Adil Bradlow / POOL)
Nelson Mandela at a news conference in Johannesburg in February 2000. (AP Photo / Denis Farrell)
South African rugby captain Francois Pienaar, right, received the Rugby World Cup trophy from President Nelson Mandela also wearing a South African rugby shirt, after South Africa defeated New Zealand in the Rugby World Cup , in 1995. (AP Photo / Ross Setford)