While reading a piece on Reuters.com concerning last Friday’s jobs numbers, it jumped at me that there was no discussion on production. The emphasis of the piece was on the increased unemployment rate and the political impact the rate may have on the fall elections. I think the emphasis is misplaced.
America is producing at just over 79% of its capacity according to the Federal Reserve. Job growth depends on a growing gross domestic product, which is advancing at a paltry 1.9%. We need to get back on the production possibilities curve by producing more with the capacity we have, and then focus on innovative technologies that can allow us to increase capacity when we have hit our limits.
Have the Obama Administration’s community coordinating Keynesian policies hit their limit? If so, is it now time for some Ronald Reagan supply-side economics?