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Rutgers University Professor Bill Rodgers on the potential impact of the fiscal cliff on the economy and job creation.
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I'm Lisa let's continue with this -- we -- talking about some -- -- economic data today good news on the jobs front but consumer confidence.
Falling amid concern over fiscal cliff and -- and the treasury department's warning once again that the government is set to hit its legal borrowing limit.
On Monday sooner than we had expected.
Joining us now is -- Rogers.
Rutgers University professor and a former US Department of Labor chief economist speak perfect guest for today's news floats are welcome you don't.
Let thank you -- -- -- -- quite yet.
Let's find the bright spot here it if it -- possible if I was gonna start with the consumer confidence number -- you and that's certainly.
Concerning especially when you look at the real impact and the psychological impact.
Of this fiscal -- debacle.
Yeah most definitely you know what's fascinating right prior to the holidays you know much of the conversation had been around Wall Street's you know -- concern about the impasse so with regards to getting to -- EDT -- with across the fiscal cliff.
And you know today's consumer confidence index out of -- reading fell a full six points.
And it was fully driven by with the interview said.
-- conference board solely driven by.
You know households -- main street being very concerned about what's gonna happen to my taxes next year was to have about unemployment insurance benefits because I live in a state or community -- -- not a lot of lot of jobs being created so so I think this really provides the imperative.
I even at a higher level for the administration and congress to get to yes and -- -- you.
Yes that's thrown out such as the CBO saying if we do go over the fiscal -- the economy the GDP will shed a half a percentage point of growth.
Could -- actually be -- if you take into consideration.
We're already seeing an impact of fiscal -- concerns are on the economy could actually be worse than we're expecting.
Yeah I mean that's I respect the CBO's numbers and the and the director.
But -- and then and they honestly say it so these are estimates right that we are trying to model described human behavior.
And and so you know I don't think we're gonna go back into recession.
But but the way I kind of talk about it or talk with my students and other people on the in the my community -- about this.
Is we put in 787 billion dollars into the economy over a period of time to rescue it right from.
From the recession.
That we -- we experienced and now we're about over the next few months if we don't get the gas is pull back or pull out about 600 billion dollars either via tax increases.
-- endorse spending cuts and so you know that's gonna have an adverse effect on Wall Street is have an adverse effect on main street and as you pointed out earlier when that a global economy this is sending horrible signals.
To the rest of the world.
What's it -- signals is that sending to your students those are.
You know as former labor chief economist you talk to these kids who are about to enter the job force him jobless claims really -- bouncing along the bottom right now.
And we -- minute clip no one's gonna hire any time soon.
Yeah I mean that you you pointed out -- hiring is -- Who is the key number here you know the good news the good news in the jobless claims is that they suggest that layoffs have begun to moderate you know that this 360000.
Number for the initial claims is in this bid in this range what we call kind of a healthy economy.
However though there's a wonderful other data set that the BO -- BLS puts out that's the Bureau of Labor Statistics and that's the jolts -- said is basically the number of job openings and if you look at -- you compare the number of people who are searching for a job actively searching.
That's -- twelve million Americans.
There's only about the 212 that Americans searching for a job.
For about you know serve every everything to me for so basically forever you one job being created out of about four people looking for a job.
And that -- that ratio has been active in the same since the beginning of the recession all right so -- -- -- -- -- I'm so sorry the -- -- I was gonna just follow -- -- -- unemployment is still a crisis in this country yet you point out some of your writings that.
The debate has shifted.
Toward taxes and entitlements and the national debt in all of this fiscal -- related stuff and and really away from the jobs -- we're gonna get the December unemployment report.
Next week you know I think we just become accustomed to it 10050000.
Payrolls added to the economy and it's like -- satisfied with that -- the problem is now.
-- is most definitely you know if you another number I like to talk about.
You know is basically the unemployment rate we call the real unemployment rate and that's if you include eight million Americans who are working part time but want to work full time.
-- additional two million Americans who have stopped actively searching but wanna job it was offered instead of our seven point 7% unemployment rate.
We have done -- up fourteen point 4%.
So back your question on my students you know one of the things I tell them or suggest them -- if you can still -- -- you can -- if you still love the studying.
You know stay in school that advanced degree going on a graduate school four people -- a lot of work with the united way.
We've been talking with lot of -- individuals there.
You know -- for investing in job training again if you can afford it and for those who are -- that part times dimension.
Or they're actively searching they can't find that job volunteering is another great way for -- to two to sort of nod to plug the holes and you know -- -- resonate.
But it is a very troubling time in -- -- and had several years ago when I was meeting with former speaker -- figure Pelosi.
That was -- it was called the job the twin deficits the job deficit in the budget death.
Here that -- much anymore college friends I'm so sorry I got where we we've got a lot of breaking news to we need to get to.
Your analysis and your take on things is fascinating we left happy back professor Bill Rogers -- loved to have records university thank you can.
