“Generation Squeezed”: Dems’ Recovery Bummer Hurts Youth

Young Americans Hold Record Student Debt But Have No Way to Pay It Off in the Jobless Obama Economy 

• The brutal conditions of the Democrat economy have been especially harsh for young Americans struggling to find jobs even as they hold record levels of student debt.
• This ongoing weakness in the economy, reflected in the grim jobs report released last week, suggests that the state of the economy could take a permanent toll on young Americans’ career prospects and earnings potential.
• Amidst this ongoing misery, Democrats continue to call for more tax hikes that will make a bad economy worse and further reduce job opportunities for struggling young graduates.

The brutal conditions of the Democrat economy have been especially harsh for young Americans struggling to find jobs even as they hold record levels of student debt:

TODAY’S YOUTH ARE “GENERATION SQUEEZED”: “The weak labor market hurts even job holders. From 2007 to 2011, ‘real’ (inflation-adjusted) wages fell nearly 5 percent for recent college graduates and 10 percent for recent high-school graduates, says EPI. Among college grads, only four in 10 said their jobs required a four-year degree, reports a survey by the John J. Heldrich Center at Rutgers University. If the economy doesn’t fully recover, slack labor demand will continue to depress employment and wages for years.” (Robert J. Samuelson, “The Social and Economic Reasons for Generation Squeezed,” The Washington Post, 8/5/2012) 

ONLY 54% OF 18-24 YEAR OLDS EMPLOYED, THE LOWEST LEVEL SINCE LABOR DEPARTMENT BEGAN TRACKING DATA IN 1948: (Shannon Bond, “Jobless Generation Puts Brake on US,” Financial Times, 7/30/2012) 

YOUTH UNEMPLOYMENT AT 16%, NEARLY DOUBLE THE NATIONAL RATE:(Shannon Bond, “Jobless Generation Puts Brake on US,” Financial Times, 7/30/2012) 

YOUNG AMERICANS FACE BOTH A BRUTAL JOB MARKET AND RECORD LEVELS OF STUDENT DEBT: “But the problem has a unique flavour in the US, where the weak job market has collided with record levels of educational debt – about $25,000 for the average graduate.” (Shannon Bond, “Jobless Generation Puts Brake on US,” Financial Times, 7/30/2012)

“AMERICANS UNDER 35 HAVE LOST MORE THAN A THIRD OF THEIR NET WORTH SINCE 2001”:  “Americans under 35 have lost more than a third of their net worth since 2001, compared with a 27 per cent decline for all ages, according to the Federal Reserve.” (Shannon Bond, “Jobless Generation Puts Brake on US,” Financial Times, 7/30/2012)

TWO YEARS LATER, STILL NO “RECOVERY SUMMER”:

2010: AFTER STIMULUS, “OBAMA, BIDEN DECLARE ‘RECOVERY SUMMER’”:(Mike Allen, “Obama, Biden declare ‘Recovery Summer,’” Politico, 6/17/2010)

TREASURY SECRETARY TIM GEITHNER IN 2010: “WELCOME TO THE RECOVERY”: (Timothy F. Geithner op-ed, “Welcome to the Recovery,” The New York Times, 8/02/2010)

This ongoing weakness in the economy, reflected in the grim jobs report released last week, suggests that the state of the economy could take a permanent toll on young Americans’ career prospects and earnings potential:

GRIM ECONOMY COULD “POSE A THREAT TO THE FUTURE EARNING POWER OF YOUNG AMERICANS,” “COULD HAVE LONG-LASTING EFFECTS ON US GROWTH”: (Shannon Bond, “Jobless Generation Puts Brake on US,” Financial Times, 7/30/2012) 

GALLUP: 58% DISSATISFIED WITH ODDS THAT NEXT GENERATION OF AMERICANS WILL LIVE BETTER THAN THEIR PARENTS: (Lydia Saad, “Majority in U.S. Dissatisfied with Next Generation’s Prospects,” Gallup, 6/4/2012) 

MEDIAN INCOME DROPS STEEPLY FOR YOUNG WORKERS: “Making up that ground will be difficult for Mr Grzywacz and his peers, who are earning less in today’s depressed labour market. Median income for those under 35 dropped 10.5 per cent from 2007 to 2010 – more than any other age group – compared with a 7.7 per cent overall decline.” Shannon Bond, “Jobless Generation Puts Brake on US,” Financial Times, 7/30/2012) 

8.3% UNEMPLOYMENT RATE, 15.0% UNDEREMPLOYMENT RATE: (Bureau of Labor Statistics, 8/3/2012) 

“IF THE LABOR FORCE PARTICIPATION RATE WAS THE SAME AS WHEN OBAMA TOOK OFFICE IN JANUARY 2009, THE UNEMPLOYMENT RATE WOULD BE 11.0%”: (James Pethokoukis, “July jobs report: America’s labor market depression continues,” American Enterprise Institute, 8/3/2012)

DEMS PROMISED UNEMPLOYMENT RATE WOULD BE AT 5.6% BY NOW IF WE PASSED THEIR STIMULUS: (American Enterprise Institute, 8/3/2012)

CBO: UNEMPLOYMENT HAS REMAINED ABOVE EIGHT PERCENT FOR THE LONGEST STRETCH SINCE THE GREAT DEPRESSION: (Congressional Budget Office,2/16/12)

12.8 MILLION UNEMPLOYED AMERICANS: (Bureau of Labor Statistics, 8/3/2012) 

“U.S. RECOVERY WEAKEST OF ANY IN THE WORLD SINCE 1970”: “In a new research note, JPMorgan points out that since 1970, Japan, Finland and Sweden have all gone through what the U.S. is currently going through. And all three of them had recoveries stronger than America’s. The above chart compares the economic recovery — as measured by real GDP per capita — of each nation at different points after the trough of their recessions. And the U.S. is in dead last after 12 quarters from the bottom.” (James Pethokoukis, “U.S. recovery weakest of any in the world since 1970,” American Enterprise Institute, 8/2/2012)

WALL STREET JOURNAL: “IT’S IMPORTANT TO UNDERSTAND HOW UNUSUAL THIS KIND OF WEAK RECOVERY IS”: “Deep recessions like the one from December 2007 to June 2009 are typically followed by strongerrecoveries, as there is more lost ground to make up.” (Editorial, “The 1.5% Presidency,” The Wall Street Journal, 7/27/2012)

Amidst this ongoing misery, Democrats continue to call for more tax hikes that will make a bad economy worse and further reduce job opportunities for struggling young graduates:

LA TIMES: “FOR OBAMA, IT’S RIGHT BACK TO TAXES AFTER JOBS REPORT”:(Michael A. Memoli, “For Obama, It’s Right Back to Taxes After Jobs Report,” Los Angeles Times, 8/3/2012)

89% OF DEMOCRATS VOTED AGAINST PREVENTING TAX HIKES (Roll Call 545,Clerk of the U.S. House, 8/1/2012)

710,000 JOBS COULD BE DESTROYED BY DEMOCRATS’ TAX HIKE PLAN: (Robert Carroll and Gerald Prante, “Long-Run Macroeconomic Impact of Increasing Tax Rates on High-Income Taxpayers in 2013,” Ernst & Young, July 2012, Appendix C)

JOINT COMMITTEE ON TAXATION: 940,000 SMALL BUSINESSES TO GET HIT BY DEMOCRATS’ LATEST TAX HIKE: “Congress’s Joint Tax Committee—not a conservative outfit—estimates that in 2013 about 940,000 taxpayers will have enough business income to meet Mr. Obama’s tax increase threshold.”(Editorial, “Off the Tax Cliff He Goes,” The Wall Street Journal, 7/10/2012)

MORE THAN HALF OF NET BUSINESS INCOME WILL BE HIT BY HIGHER TAX RATES UNDER OBAMA PROPOSAL: “And of the roughly $1.3 trillion in net business income, about 53% will get hit with the higher tax rates. This is because millions of businesses report their income as sole proprietors and subchapter S corporations that file under the individual tax code.” (Editorial, “Off the Tax Cliff He Goes,” The Wall Street Journal, 7/10/2012)

1.8% DROP IN WAGES: “Real after-tax wages would fall by 1.8%, reflecting a decline in workers’ living standards relative to what would have occurred otherwise.” (Robert Carroll and Gerald Prante, “Long-Run Macroeconomic Impact of Increasing Tax Rates on High-Income Taxpayers in 2013,” Ernst & Young, July 2012)