Chris Dillow has a good post today on why mass unemployment is here to stay.
Dillow runs the numbers and shows that to halve un- or under-employment to three million within five years would require economic growth of 3.7% a year – which is simply inconceivable in the current circumstances.
He then draws two important conclusions from this. First:
…unless everyone gets very surprised, mass unemployment is here to stay. Politicians who pretend it can be eliminated by policy measures are just making prats of themselves.
The policy questions should not be merely how to create jobs – important as this is – but rather how to deal with the inequality, unhappiness and potential social tensions that prolonged mass unemployment will cause.
But as Dillow observes:
[P]oliticians of both parties are showing few signs of answering these.
Instead, the general political response to unemployment is another example of the tendency I was talking about in a previous post: treating a structural issue (grotesque inequalities of power and wealth, economic malaise, unemployment) as a matter of ethics (good bankers vs bad bankers, producers vs predators, hard-working families vs workshy scroungers).