Doug French

During the first-ever Federal Reserve press conference, Fed chair Ben Bernanke said the number of jobs in America was still 7 million behind the number of people employed when the recession began. When asked whether the Fed could do anything about long-term unemployment, Bernanke said the central bank has been fighting it with an aggressive monetary policy. But he admitted his crew operating out of the Eccles Building doesn't have any tools to make the long-term unemployed employable again.

Orginally published Monday, May 02, 2011

A day later the news came that first-time unemployment claims rose to 429,000 — up from the week before and surprising economists, who had guessed the number would be 40,000 less. Wells Fargo economic analyst Tim Quinlan stated that "this is a major disappointment because it's another move in the wrong direction."

A generation born at the tail end of the baby boom did what mom and dad told them they should: Get off the farm, don't be a barber, forget about being a mechanic. Go to college and then go be a doctor or lawyer or such. However, high barriers to entry and lack of mental horsepower kept most out of medical or law school. But a business degree means you will still be able to wear a shirt and tie to work, not get dirty, and push paper for a living. An MBA will make you unstoppable.

What's known as the FIRE economy ("Finance, Insurance, and Real Estate") fired up in 1980 and headed for the sky until 2006. Now there are 50-years-olds who may never work again. In an April 25 cover story, Newsweek described these out-of-work boomers as "Dead Suits Walking."

Capitalism has always been cruel to its castoffs, but those blessed with a college degree and blue-chip résumé have traditionally escaped the worst of it. In recessions past, they've kept their jobs or found new ones as easily as they might hail a cab or board the 5:15 to White Plains. But not this time.

A post on the professional-finance blog Calculated Risk says that if college-educated workers 45 or older lose their jobs, "they are toast." That sounds harsh, but the point is that even in the financial capital of the world, New York, "men in the 35-to-54 kill zone have lost jobs faster than any other group, including teenage girls, according to new data from the Fiscal Policy Institute," write Newsweek's Rick Marin and Tony Dokoupil.

Doug French

Doug French is is president of the Mises Institute and author of Early Speculative Bubbles & Increases in the Money Supply and Walk Away: The Rise and Fall of the Home-Ownership Myth

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