SUNBURY — When President Barack Obama gives his jobs speech Thursday night before Congress and a nation facing a 9.1 unemployment rate, he should act to lower the minimum wage and taxes, target government investments wisely, spend on long-lasting projects, or cut spending, reduce regulations and trim the size of Washington, Valley experts suggested.
All while realizing there is only so much the government can do to stimulate long-term economic growth, that whatever he decides to advocate may be challenged by the Republican-led House, and that if he does nothing, the U.S. could have a second consecutive month of zero job gains.
No jobs were created in the United States in August, the Labor Department reported Friday in a report far weaker than analysts had expected and one that renewed fears that the U.S. might be sliding toward another slowdown or recession.
There is only so much a president can do, Valley economic experts said.
“First,” said Matthew Rousu, associate professor of economics at Susquehanna University in Selinsgrove, “to see long-term job growth, the government can’t be the one creating jobs. This has never worked for the U.S., and it won’t work now.”
For short-term growth, he said, the government can help, but the focus should be on jobs that employ lower-educated or blue-collar workers who have been disproportionately hurt by the recession.
“To make good use of tax dollars,” Rousu said, “the projects funded should give taxpayers something useful, preferably that lasts for many years. Once again, the Central Susquehanna Valley Thruway project seems like an ideal ‘stimulus’ project.”
An unconventional option would be to propose a decrease in the minimum wage, which, in Pennsylvania, is $7.25 an hour, Rousu said.
“The lowest-skilled workers have the highest unemployment rate,” he said. “A decrease in the minimum wage would make the lowest skilled workers, typically teenagers, more attractive to hire and would decrease the unemployment rate.”