A Euro Take on America's Jobless Recovery

Politics, says the Economist, has a lot to do with the much talked about jobless recovery in America.

"A puzzle for economists, jobless recoveries are also a conundrum for psephologists, who study presidential elections. We know it’s the economy, stupid, but is it growth or jobs that have most bearing on the way people vote? GDP growth of 3% in 1992 was not enough to save George Bush senior. Growth of 3.8% in 2000 was not enough to win the election for Al Gore. Professor Michael Lewis-Beck of the University of Iowa and Charles Tien of Hunter College think unemployment is a more decisive factor. In every election since the second world war, falling unemployment in the spring of election year has foretold victory for the party in charge of the White House. The sole exception was the Democrats’ loss to General Dwight Eisenhower in 1952. Mr Bush will take some comfort from this. As long as the unemployment rate keeps falling through the spring, he should be home and dry in next year’s election. Unless, perhaps, he goes up against another decorated general."

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