A bipartisan jobs plan is the top priority

It is time our elected leaders and presidential wannabes treat America’s jobs crisis as the social and economic catastrophe that it is, and not just as fodder for 2012 campaigns. Given the partisan warfare on Capitol Hill, it isn’t surprising that President

Barack Obama’s $447 billion jobs plan is being torpedoed by Republican opposition. Nor is it surprising that he and congressional Democrats have decided to focus on a strategy of pushing forward a series of executive-branch initiatives aimed at creating spending programs to invigorate the economy.

Last week, for example, Mr. Obama unveiled a rule change that allows homeowners with federally guaranteed loans to refinance those loans at lower rates in order to avert foreclosure or simply take advantage of today’s low rates, even if they have little to no equity in their homes. He also announced policy changes that will make it easier for college graduates to repay federal loans.

Although that may help the economy, Mr. Obama and congressional leaders on both sides of the aisle shouldn’t give up on developing a bipartisan jobs plan. With the nation’s unemployment rate stalled at 9.1% and likely to remain there for the next year, getting Americans back to work is and always has been Job One for our elected leaders.

Put simply: Doing nothing isn’t an option.

The U.S. labor market added 103,000 jobs last month, falling short of the 125,000 jobs needed to keep pace with population growth and well short of the 277,000 new jobs needed each month to make a dent in the unemployment rate.

In all, about 14 million Americans are unemployed, and a staggering 45% of them of them have been out of work for at least six months. The longer that workers are out of a job, the more likely it is that their skills will become obsolete, making them unable to re-enter the work force at their previous level.

Studies have shown that long-term unemployment also significantly diminishes a person’s earnings abilities for decades after they re-enter the workforce, not to mention its negative health consequences.

Of course, high unemployment affects more than the unemployed.

A weak labor market undermines long-term economic growth, which hurts the country’s competitive footing in global markets.

OKUN’S LAW

Consider Okun’s law, which is a well-accepted economic concept that characterizes the relationship between economic growth and unemployment. Named after the late economist Arthur M. Okun, the law — or, more accurately, Okun’s rule of thumb — holds that for every 1-percentage-point jump in the unemployment rate, there is a 2-percentage-point drop in gross domestic product.

The combination of anemic growth and high unemployment is also a surefire recipe for social unrest. In fact, we are already seeing the seeds of that unrest take root in the form of the Occupy Wall Street movement, which is spreading rapidly.

Indeed, one need not look far for signs that Americans are fed up with the status quo. The Conference Board’s consumer confidence index dipped to 39.8 this month — its lowest level since March 2009 — from a September level of 46.4.

To put those numbers in perspective, consumer confidence generally tops 90 when the economy is zipping along.

Time is running out. If at all possible, Republicans and Democrats should divert some of their attention from next year’s elections and focus on developing a jobs plan that both sides can live with.

Such a plan should contain elements that both anti-tax Republicans and pro-spending Democrats can live with.

For example, the first part of such a plan could involve a series of short-term measures aimed at stimulating job growth immediately. These could include some combination of cuts in payroll taxes for small businesses — including a tax holiday for businesses that hire new employees — and additional spending on infrastructure, such as roads, bridges and schools, to increase the nation’s economic competitiveness.

The second should involve long-term spending cuts and/or tax increases aimed at reducing the nation’s budget deficit significantly. Those measures shouldn’t, however, be enacted until after the economy has shown consistent signs of improvement.

It is time for our elected leaders to put what is best for the country ahead of what is best for their political parties. In the end, it is more important that Americans are able to pay their mortgages and feed their families than whether a Democrat or a Republican sits in the White House.