Jobs Are Disappearing Fast: Is There Any Relief in Sight?; How to Keep Your Jobs and How to Get a Job
CHRISTINE ROMANS, CNN HOST: Welcome to YOUR MONEY. I'm Christine Romans. Nothing is more critical to your money than your job and American jobs are disappearing fast. 1.9 million jobs have vanished so far this year bringing the unemployment rate now to 6.7 percent. The losses have spiked at the end of year. More than half a million of you lost your job in November alone, that's the biggest one-month cut in almost 34 years. More than 300,000 jobs were cut in October. More than 400,000 in September. That's more than a million jobs lost in just the past three months. Some sectors, the hardest hit range from the trading floor to the assembly line, businesses and services lost 130,000 jobs, retail, trade, more than 90,000 and manufacturing 85,000 and just this week, some very familiar companies slashing jobs as well.</s>ALI VELSHI, CNN HOST: Retail trade losing 91,000 jobs in November, that's when they're supposed to be ramping up and the job losses are coming at companies where the names will be very, very familiar to you. A huge week for job cut announcements, AT&T; slashed 12,000 workers. Credit Suisse, 5,300, DuPont laying off 2,500 employees. Viacom making 850 cuts and NBC announced plans to cut 500 jobs worldwide. That's more than 20,000 this week alone. Some sectors are growing, though. Education and health care services, we talked a lot about those on this show. Government jobs, plus resources and mining, oil obviously, even though the price is low, we're still drilling for oil. So is there any relief in sight? We are joined by a fantastic panel, Peter Schiff the president of Euro Pacific Capital, Lakshman Achuthan is the managing editor of the Economic Cycle Research Institute and Jim Ellis is the assistant managing editor of "Businessweek." Thanks to all of you for being here. I want to start with you, Peter; you have been writing about and describing a coming crash and recession for some years now. I hate to say that some of the things that you've written about is outlandish as they seem do seem to be bearing out right now.</s>PETER SCHIFF, PRESIDENT, EURO PACIFIC CAPITAL: Sure, you know the problem, too, a lot of the jobs that are now being destroyed in our economy never should have been created in the first place, they were a function of our bubble economy. The fact that Americans were borrowing money and spending too much and as they can no longer spend because we're broke, all of these phony service sector jobs will have to disappear. As painful as it is for the people who are in those jobs, the government has to stand aside and let it happen. We can't try to keep people in nonviable jobs. We have to go back to making things and it will be a very painful process and Americans are going to have to rein in their spending and start saving money.</s>VELSHI: I just want to ask you one thing, and I know this is theory that you've worked on, but we're now talking about officially close to $2 million jobs lost this year alone and it could be substantially more. I've heard you say it will mean millions of job losses to set this economy straight. What is the real equation there for people? What does your science and your academia tell you what to do when 5 million people are unemployed?</s>SCHIFF: That's how markets work.</s>VELSHI: Don't we have an obligation as a nation, as a modern economy to make sure that 5 million people aren't living in tents?</s>SCHIFF: There's nothing we can do. The government can't create jobs; they'll destroy jobs trying to do it. The government doesn't have any money all they have is a printing press. We need to free markets to create jobs; if the government wants to help they should reduce their burden on the economy. We should be cutting government spending. We should be cutting taxes and we actually should be raising interest rates. We're doing all of the wrong things and we're going destroy this economy.</s>ROMANS: Nobody is talking about doing any of those things. You're right. What they're talking about doing is spending a whole lot of money in fiscal stimulus and we have the Federal Reserve doing everything that it possibly can to keep the economy.</s>SCHIFF: Remember, we're in trouble, because we borrowed and spent too much money. We're not going to borrow and spend our way out of it. We have to do the opposite of what we've been doing. We're simply digging ourselves into a deeper hole right now.</s>ROMANS: Lakshman, we're not doing what Peter says we should be doing and no one says we are going to do that. What are we doing and will it work?</s>LAKSHMAN ACHUTHAN, ECONOMIC CYCLE RESEARCH INSTITUTE: Well one thing we are doing is we're probably cutting taxes which I think is one of the things you are prescribing. What we are doing here is they are throwing an ungodly amount of money at the economy. Not only the U.S., all of the major economies in the world are doing this, even China is doing it in a coordinated way.</s>VELSHI: You're a proponent of the idea that that will ultimately work.</s>ACHUTHAN: Look. What this will do is it will mitigate to a degree the pain on the way down. We are in a severe recession. As you were pointing out this economy went from a mild recession to a very, very severe recession. The numbers today they don't tell you anything about the future they just tell you that a few weeks ago we really accelerated to the downside. When you look at the forward-looking indicators on the business cycle, they don't look years ahead, they look quarters ahead, they are tanking. They are at the worst readings they've been at in 60 years so we've got more numbers like we saw today on Friday coming in the months ahead and the one thing, the business cycle, the sharper the downturn, it tends to get a sharper upturn. All of the things that we're doing here in the desperation of the moment are going to create all kinds of big questions on the other side in terms of the ideology of free markets, inflation and other things. Printing presses with the currencies.</s>ROMANS: But Jim Ellis says, it is too soon too start worrying about that, right? We are facing the beast that we're facing right now and then somewhere down the road there will be a recovery and a bubble that will have to be popped again, but what are we doing right now and will it work?</s>JIM ELLIS, ASSISTANT MANAGING EDITOR, "BUSINESS WEEK: " Well right now we basically have to find ways to free up the credit markets and get people to lend again and as bad as we ran into trouble with people borrowing a lot and spending, we've got to get people spending again. That is something that I think some people, particularly fiscal conservatives really worry about, but that's the bubble to come. That's next year's fight or the fight after. Right now, the only thing to do is to get money coursing back do the economy and that will be a real challenge for the new president if and then we're talking about doing that and basically accepting deficits that we haven't seen in years.</s>VELSHI: Hold on, Peter, we are going to have this discussion in a way where our viewers can understand how they fit into it. This is a very smart discussion. You need to know how this affects you. The big buzz this week has been about the auto industry and whether or not to give it a bailout loan that is worth billions of dollars. You'll hear what one auto CEO claims would happen if his company went under.