The Seven Per Cent Solution


One of the most common nuggets of conventional wisdom circulating through the media is the notion that President Obama’s re-election chances hinge on getting unemployment down to 7%.  If he can do this by November 2012, he’s in good shape – perhaps unbeatable.  If unemployment is over 7%, he’ll be in deep trouble.

As the New York Times put it yesterday, “No American president since Franklin Delano Roosevelt has won a second term in office when the unemployment rate on Election Day topped 7.2 percent.  Seventeen months before the next election, it is increasingly clear that President Obama must defy that trend to keep his job.”

When did 7% unemployment become the new gold standard of economic success?  We’re supposed to be happy with that?  I can still see the holes in the ground where the old employment goal posts used to be.

Would Americans really be happy with a sudden plunge to 7% unemployment in the fall of 2012, after years of the stagnant Obama economy?  Would they really stop thinking about the millions of jobs lost during Obama’s term, if new unemployment claims drop sharply in his final months, and there’s some job growth for the media to report?  No populace with such short memories and limited ambitions could hope to retain their freedom.

We’ve got new job numbers coming out tomorrow, and the early indicators are not good.  “Psssh.  That’s the sound of the air being sucked out of the job recovery,” reports CNN.  Job recovery?  What the hell are they talking about?  When was this?  At any rate, they concede “the glass is now looking closer to empty than full.”

Another troubling indicator is the dismal report from the manufacturing sector, which speaks of slumping orders and rising inventory backlogs.  Think about a huge train coming to a sudden stop.  Consumers are the engine.  Consumption has slammed on its brakes, and the manufacturing sector is among the first cars that will plow into it.  The next few cars contain stagflation, a double-dip recession, or perhaps even an outright depression.  They are hurtling forward with the inertia of vast government spending, huge deficits, and crushing entitlement burdens.

It’s not surprising that the public pays a lot of attention to employment figures.  Everyone is vaguely nervous about losing their job, even in the best of times.  They view the loss of employment as the unraveling of careful plans for the future.  Americans know a properly functioning economy creates opportunity, which is readily measured by the number of jobs created during its pursuit.  If everyone is working, surely every other problem will work itself out over time.

This is a dangerously short-sighted view, taken in isolation.  The most important thing to remember about desirable employment is that it’s long term.  Few people dream of being hired for a succession of temporary jobs that end without warning.  Few companies wish to hire a workforce on that basis.  Training people is time-consuming.  A job is not a commodity to be suddenly acquired, or lost.  Successful employment is a commitment, for both worker and employer.

Commitment is not ephemeral.  It does not blow lightly between cycles of boom and bust.  If you want a successful career, marked with promotions, raises, and increased benefits, you want your job to exist within a stable economy of constant growth.  If you do lose your job, you want another to become available quickly.  If you grow tired of your career path, you want others available for exploration.  You won’t see the shape of the future for years to come in the unemployment statistics from June 2011, or October 2012. 

If 7% unemployment really does make Obama unbeatable next year, he will become the perfect ruler for a diminished people, without the memory to understand what they have lost, or the vision to see what they could achieve.