A remarkable thing happened while Congress continues to bicker over the budget and unemployment remains stubbornly high: Wall Street had its best day ever.
The Dow Jones Industrial average hit a record 14,255.77 Tuesday, a positive indicator of where the economy is going. It was even more stunning that the markets—which purportedly are quite sensitive to factors ranging from policy proposals to political developments—seem unfazed by the fact that Congress can't get its act together to work on the debt. In fact, the ongoing dysfunction in Washington has become its own, sad, stabilizing force in the markets, since the inability to work together has become so depressingly consistent that investors can plan around it. Markets like certainty and predictability, and Washington lawmakers have certainly provided them with that.
While the news is cheering on paper, it should also raise some deeper questions. Why is it, four years after Wall Street malfeasance brought the country—indeed the world—to the brink of depression, the investor class is doing so well? It was galling enough when Wall Streeters who ran the economy into the ground expected to receive huge bonuses as incentives to fix it. But four years later, they're back on top, and unemployment is still just below 8 percent? Big corporations are making record profits, and stocks are at an all-time high. If these are the "job creators," where are the jobs?
Part of the employment problem has to do with the expiration of the stimulus so reviled by conservatives. Many people didn't like the idea of the government spending more money during a debt crisis, but it was a way to create and keep public sector jobs, priming the pump for an American economy that is 70 percent driven by consumer spending. Now, it's the private sector that has the cash. It's time for them to start investing it in jobs—or explain why they shouldn't be contributing more to the US Treasury.
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