newjerseynewsroom.com

BY ROY NERSESIAN

COMMENTARY

Let's look at the facts. Below is a chart of the percentage of job losses from the previous peak employment for every recession since World War II.

The chart is telling us a story.

1. The cyclical ups and downs under conditions of "normalcy" occur quite regularly.

2. Recessions, measured here in restoring jobs to their previous peaks, are taking longer to recover.

3. Nearly all post WWII recessions were over in between 1 and 2½ years. The exceptions are the 2001 recession that was over in four years and the present recession that started in 2007.

4. The current job recovery is anemic lacking any hint of a rapid recovery. In fact, the line looks like it's going to take a decade or more to get back to where it was — conceivably it could flatten out and never get back to where it was.

Woodbridge Logistics laid off 1,100. Was this lay-off avoidable? The fact that there were labor-management negotiations means that perhaps it was avoidable — but at a cost. With A&P, the granddaddy of all super market chains bankrupt but still operating, costs have to be cut to avoid liquidation. It does not take too much imagination to realize that management offered a package that involved significant wage and benefit cuts. Nor does it take too much imagination to realize that the union resisted, maybe even refusing to budge an inch. Then management threatened that if their demands weren't substantially met, then all six warehouses in New Jersey would be shuttered. At this point the union may have decided to play hardball thinking that management was bluffing. If so, they played a bad hand. Now the union is negotiating severance packages. I'm sure all the union members are elated that the union is fighting for their severance packages now that they've lost their jobs.

My heart goes out for these workers. With loss of jobs, their union has let them down. Sticking to unrealistic goals in the face of economic uncertainty does not smack of wisdom. What are they going to do? Run down to Walmart as a group of 1,100 for a single position as Greeter? For many, they will have to face "end-time" economic choices. Does my wife have a job? Can my children help out a bit? Do I qualify for food stamps or welfare? Should I sell my house and buy a cheap vacation trailer in the middle of Florida and sit out the rest of my life in some squalid trailer park infested with mosquitoes and rattle snakes?

State pensioners are going to have to face the same choice. Their union, too, can play hardball. They can pretend that all the State Constitutional and other legal requirements are a guarantee on their pensions. They can take comfort that they'll get paid no matter what other programs have to be cut — truly the case of the dead eating the living. But if there is no money in the government till, their cherished pension checks are going to bounce.

Prospects are dim for all Americans. The government has not come up with one idea for creating jobs. The railroad tunnel under the Hudson River has been revived, but by the time all the hurdles are overcome, the recession may well be over. There are words about building a national rapid transit system, but they are words. The words for building green energy plants (wind and solar) from coast to coast aren't even words any more. The government is paralyzed and will not protect domestic industry as have Japan and Germany. They still believe that the Walmart paradigm of outsourcing manufacturing and providing credit for consumers will save the day. What kind of dope are they ingesting? They actually believe that zero interest rates driving up stock market values is good for the country. In their twisted, bedazzled minds, they believe that high stock prices will cause people to feel more confident and induce them to jump up and run on down to Walmart to buy more Chinese crap. Somehow this is going to make things better.

Do you believe what's happening in Egypt can't happen here? Egypt has no manufacturing jobs because they, too, have let China take over their markets. Their people have little hope of employment ever in their lives. There are parallels to what's happening here except we have the additional pain of people losing their homes from mounting foreclosures.

Roy Nersesian, a resident of Maplewood, teaches at the Leon Hess School of Business at Monmouth University in West Long Branch and also at the Center for Energy and Marine Transportation at Columbia University. He has authored several books, the last on Energy for the 21st Century published by M.E. Sharpe.

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