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Podcast Special: The economy, one step at a time

Occupy Wall Street protestors have brought to light a variety of start economic issues facing the U.S. Our special podcast series examines those issues.

Volatility. Uncertainty. Political Paralysis. Default. Downgrades.

It has been a wild ride for the American economy in August. Case in point, the stock market: Down 500 points one day, up 400 points the next. Down, up, down, up ,up, down. It's almost like a bad melody.

But the thing is the American economy is not just the stock market. And while it serves as a daily reminder of something that's going on, it is not the entire story.

The story is really about individuals and families, small businesses and corporations, retirees and the middle class, political leadership and economic choices. And that's what we decided to examine in this special one-hour audio broadcast from our ongoing series, The Breakdown: Our economy, one step at a time.

The market is not the economy

Marketplace New York Bureau Chief Heidi Moore explains it like this: "We follow the stock market because it is instant but if you dig down a little deeper, the path of the stock market rarely follows the path of the actual economy."

So what about that actual economy? What matters?

In a word, jobs. And the lack of them. Or as, William Dunkleberg told us, "I don't think we've seen any decent jobs growth since the recovery allegedly started back in June of 2009." He's the chief economist at the National Federation of Independent Business.

It takes jobs to restart the economy

More than 13 million Americans are out of work in America, pushing the unemployment rate to 9.1 percent last month. But in some communities, like Baltimore, the number is twice that. And for job seekers, like college graduates and workers over 60, the numbers are worse.

We talked to Dwayne Robertson, an unemployed resident of Baltimore, about his challenges searching for work in that hard hit region: "Everybody is basically unemployed. Especially most of the males. There's no work for 'em. They have a lot of programs, like job readiness programs, but they're not helping 'em find jobs. 'Cause I've been through maybe three of those, and still I'm unemployed."

Throughout this show, you'll hear from job seekers and job creators. You'll learn about what it takes for one company to hire one employee. And we examine the so-called "hour-glass economy," which describes the growing divide in America's workforce. The concept helps put into perspective what the future of the American job market might just be 9 percent unemployment and millions out of work.

America in the global economy

Even as we tackle the issue of putting Americans back to work, our economic future is more and more tied to our place in the global economy. More than ever, it matters to America what's happening to the economy in countries like Japan, Greece, and Germany.

The U.S. is not the only country in a big heap of debt trouble. Europe is facing an unprecedented debt crisis. So we took a look at what's happening in those countries, and how they're impacting the recovery here at home.

The downgrade

And finally, there's the downgrade. A couple of weeks ago, America experienced a first: A historic downgrade by the ratings firm Standard & Poor's. Economist Richard Sylla at NYU's Stern School described the action as more sting, than substantial.

"It's kind of embarrassing, though, because you know the United States has basically had a prime credit rating throughout just about all of our history," Sylla said. "It's kind of sad that after 220 years we appear to be less than AAA."

An economy in transition

What we appear to be is an economy in transition, an economy in recovery that doesn't seem to want to follow the rules of what a recovery is.

We'll explain what all of that means in the show.

About the author

Kai Ryssdal is the host and senior editor of Marketplace, public radio’s program on business and the economy.
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I agree that endless welfare benefits must stop. Let's start with Nurses, Doctors, Firefighters, Teachers and especially Police Officers!!! The laws of supply and demand are out of whack for their pay scales; often at far greater expense than paying someone who worked for a private company making under $15 an hour unemployment extensions. Their are some serious cost savings by bringing the aforementioned "government workers" (If you work in a place that recieves most of its money from the government thus you can just charge and charge with no regard to market forces, your a government worker) ridiculous pay and benefits in line with economic reality and not fantasy. I have nothing against someone who actually "worked" for their unemployment benefits receiving them in this whacked economy where someone can retire at 55 and recieve more than a minimum wage worker can make working 40 plus hours a week every month for possibly more years than they actually worked and than pass it to their spouse (if married 10 or more years) who didn't work for even more years. Look around and you'll see the real welfare recepients are these uneducated, worked some piss-ant job for maybe a couple of years and now reside in the house their dead husband bought and paid for, elderly ladies you'll find all over the place. It is their healthcare costs which are really draining the system. Gee, someone who put almost nothing in the pot is taking an average of $200,000 worth so her life can be extended from the 70's to her 90's and that isn't a form of welfare???

I vote for comedian Tim Bedore's plan, for a debt do-over (http://www.marketplace.org/topics/economy/commentary/hows-about-do-over-...). In the meantime, We Give Back USA (WeGiveBackUSA.Biz) is creating a revolutionary new financial aqueduct system, redirecting back to nonprofits and their for-profit partners funds from the $43 Trillion merchant services electronic payments industry. Necessity is the Mother of Invention. We have waited long enough. Our current government structure and policies cannot re-boot and fix this economy. Boot-strapping is a perennial solution. Now, it's on steroids, thanks to We Give Back USA.

Also the easiest way to create an incredible amount of jobs, is to make man made devices eco-friendly. We can set a dates, one thing at a time, first all our kitchen appliances are made earth friendly, when we accomplish that onto the next thing. This will create so many jobs! Think of how many things we have that need to be converted into biodegradable products.

In order to find a solution, you must first find the root source. Fractional Reserve Banking, or how every single United Stated dollar is created, is the cause of all the debt. Every time the US "borrows" money from the Federal Reserve, more debt is added on. If our government were to pay back every dollar they have ever borrowed from the federal reserve, there would be no money left over to pay for the debt. So our government has to "borrow" more money to cover the debt that already exists, which creates more debt. If we want our economy to survive, we must eliminate fractional reserve banking, also known as "Usury". And create a new monetary system which is not a bottomless money pit.

I was looking forward to hearing your special about the Economy. I was very disappointed though when there was not a single mention of the price of oil, and it's impact on the economy. Are you by chance planning a separate special dedicated to the issue of high oil prices and the reason why it is dampening any recovery? Why there is a primary limit to growth, namely a lack of cheap oil?

@WPA, We don't have to create a new expensive make work program like the WPA, all we have to do is permit private business to pay workers the same as the WPA did back then. You get a set of work clothes, a cot to sleep on, 3 meals, and $5 per day that must be sent to the family of the worker. Think of all the industry that would come back to the US if we could pay people like that again? We don't need to government to tie up resources to keep them busy, we just need it to step out of the way and let the price of labor reach the clearing price, and I bet it's more than the WPA payed back then. We don't need valuable labor tied up making hiking trails, we need then drilling for oil, farming, and working in factories.

Rescaling the WPA from the 1930s
to the current US population and economy, it'd hire over 7.5 million unemployed people (one per household, full time), and spend approximately $1 trillion per year.

The WPA in the 1930s INVESTED approx 6.7% of US GDP per year building dams/power plants, schools, roads, bridges, water and sewage systems, parks, community centers, libraries and other PUBLIC (not privatized) works.

The expenditure per employee would have represented an equivalent expenditure of approx
$130,000 per WPA employee in the current economy (eg.
a substantial amount of money was not only available to pay wages, but also pay for equipment, training and administration).

Not only did the WPA save millions of American households,
it also saved the skill sets of
millions of American workers.
When people become unemployed for long periods of time, it is much harder for them to continue to maintain and develop
their human capital.

Many of the WPA's works are STILL STANDING AND STILL IN USE - IMPROVING ALL AMERICAN'S STANDARD OF LIVING TODAY.

That was smart and lasting government investment.

Naturally, the Republicans at the time complained bitterly
and called FDR a communist.

FDR, unlike Obama, didn't care.
He realized that the wealthy
interests would be upset and FDR was willing to FIGHT them for the benefit of the vast majority of the American people.

Pres. Obama - please *PROPOSE* something BOLD. Your opponents will hate and criticize you NO MATTER WHAT YOU DO. FIX AMERICA! PUT THINGS RIGHT!

Where can I find the list of music tracks for this special? Doing so would make me more inclined to engage in behavior that might stimulate the economy, or something.

@Norma, as the government mandates more and more employee benefits, the idea of having 2 employees each working half time becomes less tenable since the cost to an employer is much higher. If we could reverse the mandates, job sharing would make a lot of sense. And regardi ng the digital revolution, if we're truely able to do more with less people, the cost of those goods should be less (since they have less inputs) and we could support our families with less working hours. We would be able to have more leasure and at the same time a high standard of living. My instict however is that many jobs have moved off shore to lower cost places, but our price structure has yet to adjust in response to the resulting surplus.

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