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Date Posted: 13:33:37 09/26/02 Thu
Author: Michael (reposted by Richard)
Author Host/IP: 1Cust65.tnt1.gainesville.fl.da.uu.net / 67.243.7.65
Subject: The 10 things President Clinton did to relieve unemployment

Hi everyone,


Michael is a very articulate and well informed political observer. He posted a list of reasons why he feels that President Clinton helped lower unemployment during his two terms in office. He did this in reply to my challenge to name those policies or actions of President Clinton's that actually lowered unemployment.

As a reference, I found an Unemployment chart from 1950 to 2001. If you look at it, you can see that the unemployment rate during President Clinton's two was very low.

Here is his original post from another board. I'll reply in a seperate post.

Richard



The top ten things I think Clinton did to combat unemployment:



  1. Inspired confidence through activist rhetoric, which had a bracing effect after the passivist rhetoric of Bush ("stay the course", "thousand points of light", etc.)

  2. Got NAFTA ratified, which stimulated the economy, which lowered unemployment (even Republican free-trade advocates were promising that it would create lots of jobs, it's just that their guy, Bush, was never able to push it through the Democratic Congress).

  3. The FMLA. I believe this gradually reduced unemployment by keeping people from becoming "unemployable" after a leave of absence, speeding the return to work of people who needed some time away, for family reasons (this was passed by the Democratic Congress, after Bush had vetoed it twice already).

  4. The EITC increase. This had a subtle effect on unemployment, but I think it was a factor. By putting more money in the hands of the working poor, it gave them a better ability to afford educating themselves, thereby becoming more employable -- for example, a waitress attenting school part time to become a paralegal.

  5. Americorps. Their numbers were small enough that it didn't have a serious direct effect on unemployment, but I do think they helped to revitalize some city centers, which had an indirect effect on unemployment. Similarly, Clinton's various crime-prevention programs, like the Brady Bill, may have helped in the decrease of the unemployment problem in the inner cities, by pulling cultural life back downtown, creating jobs there.

  6. 100,000 new community police. That constitutes a small direct drop in unemployment, but a more meaningful indirect effect, as with Americorps.

  7. The WTO round of the GATT. Like NAFTA, this was a big job creator.

  8. Welfare Reform. I give the Republicans a bit of credit on this one, since they controlled the Congress by then. However, most of what I like about the Welfare Reform law was stuff that was only grudgingly inserted after Clinton vetoed the bill and threatened to do so again. The unemployment-fighting aspects were things like the funds for new job training, and for day care. Those things helped welfare recipients to become more employable, and to actually have the ability to work without abandoning their kids.

  9. The Telecom reform act. The Republicans get a lot of credit on this one. I believe it factored into the acceleration and extension of the boom after 1996, especially with regard to the Internet. Since long, strong booms are what is needed to get unemployment declining, that helped.

  10. Minimum wage increase of 1996. The Republicans get little credit for that. Although old-fashioned economic wisdom says that minimum-wage hikes cause unemployment, the record shows quite a different trend. I think such hikes actually help keep employment up, since those who might otherwise decide it's just easier to collect welfare are given a better incentive to find work. When the spread between what one can get for no work and what one can get for base-level work is greater, fewer people will voluntarily opt for not working. This also tends to build on itself as a trend, since the lack of a ready pool of labor convinces businesses to hesitate before "downsizing" workers, since they cannot be confident of finding replacements if they're needed later.

In addition to these, he also pushed a lot of small, targeted programs to help with unemployment (work training programs, enterprise zones, etc.) He can also be credited for what he didn't do (he didn't waste the employment-creating potential of GDP by letting it be horded entirely by the rich, which would have happened if he'd been a big tax-cutter like Reagan or Dubya). Similarly, if he'd pushed for an indefinite an ill-defined war, that, too, may have squandered the economy's ability to employ people, rattling markets and encouraging downsizing.

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