The New York Times and the Los Angeles Times lead, and the Washington Postoff-leads, with word that theU.S. lost fewer jobs than expected last month as the unemployment rate rose to 8.9 percent in April. The NYT notes that stock prices were up yesterday as a result, and the LAT points out that consumer spending and pending home sales were on the uptick for the second month in a row. However, economists expect unemployment will surpass 10 percent before the recession ends. If discouraged workers, who have stopped looking for jobs, were included, the current unemployment rate would rise to 15.8 percent. The prevailing attitude in the papers is that utter doom and despair have given way to more tempered feelings: The NYT calls the present job market "dreadful" but less so than "the stomach-churning events of recent months," while the WP says the recession is "pulling away from an economic abyss into a period of steep, but orderly, decline."
Government hires of census workers helped offset the unemployment numbers last month, and the WP leads with predictions that the Obama administration will have to spend tens of billions of dollars more to jolt the U.S. financial system out of the recession. The government seems to have the resources to do it, though. After yesterday's positive "stress test" results, officials expect some of the better-off banks to return some $35 billion in bailout money, which would leave the Treasury with $145 billion to prop up the auto industry, offer better rates to local governments and agencies seeking loans, and possibly aid some of the larger life insurance companies. The Wall Street Journal leads with a follow-up to yesterday's news, revealing the caveat that the Federal Reserve "significantly scaled back the size of the capital hole facing some of the nation's biggest banks" in conducting the "stress tests."
Although two of the banks proclaimed healthy in the "stress tests" already have new investors, not all the nation's banks are doing well. Fannie Mae reported yesterday that it lost $23 billion in the first three months of 2009. The domino effect caused by an increasing number of mortgage defaults—the most toxic kind of loan and the one that accounts for the majority of Fannie Mae's business—has left the company in the hands of government aid once again; keeping Fannie afloat will require an additional $19 billion in government funding, on top of the $15 billion it received from taxpayers in the fall.
The tough job market may have lasting effects on the earning potential of this year's college grads, the WSJ reports. Drawing on recession data from the early 1980s, the article explains that the earnings of those who finish college when unemployment is high take a hit for up to 15 years after graduation. Instead of moving straight into top jobs in their preferred field and gaining experience early on, grads struggle to find unrelated or less prestigious positions. Those who went to graduate school soon after earning their bachelor's degree in the '80s tended to be at less of a disadvantage.
Losing your job may also be detrimental to your health. A Harvard School of Public Health study shows that people who are laid off have a one in 10 chance of developing ailments like diabetes or high blood pressure in the ensuing year and a half, regardless of whether or not they find a new job right away.
So what's President Obama's grand plan to get the country on its feet again? Be optimistic. The NYT suggests that the president and his aides have been trying harder than usual this week to look for the silver lining amid discouraging economic news.
Inside the A section, Gen. David Petraeus affirms that Pakistan has become the "global base" for Al-Qaida's efforts "to plan new terror attacks and funnel money, manpower and guidance to affiliates around the world," according to the WSJ, replacing Afghanistan. At the same time, the Pakistani government is stepping up its fight against Taliban insurgents in the northwestern part of the country, near the Afghan border. This week's NYT Saturday Profile is on Pakistan's ambassador to the U.S., Husain Haqqani, whose "high-minded analysis and street corner gossip" provide fodder to American journalists covering these developments.
In Somalia, meanwhile, local efforts to deter piracy are growing. Islamic communities where pirates once found financial and even governmental support have begun to form "grass-roots, anti-pirate militias," according to the NYT. While local leaders are hesitant to go after the top players among the region's pirates, they have at least begun speaking out against them. Some of the pirates, quick to name their price, say they'll change their ways if certain conditions are met, including employing them to police Somalia's waters as a kind of coast guard.
The WP fronts news that the Obama administration is still planning to revive military commissions at Guantanamo Bay, as was suggested last week, after the president's 120-day moratorium set in January expires. Meanwhile, another front-page story asserts that Speaker of the House Nancy Pelosi knew about the Bush administration's use of water-boarding in 2003 from one of her aides, who was privy to that information. Pelosi has said that she was never "directly briefed" by Bush administration officials on the practice. The WSJ goes one step further and says Pelosi and the chairman of the House Permanent Select Committee on Intelligence were jointly briefed on the use of torture by the CIA in 2002.
The NYT fronts the latest details on the murder of a 21-year-old Wesleyan University student earlier this week, revealing that the suspect in her murder, Stephen P. Morgan, who was arraigned yesterday, had had a privileged upbringing in an affluent Massachusetts suburb, graduated from prep school, and completed a stint in the Navy.
In California, more than 30,000 people, one-third of Santa Barbara's population, have been evacuated due to the fire still raging there, seeking shelter in schools, hotels, and with friends, some already at their second refuge after being evacuated from the first.
And in South Africa, the election of President Jacob Zuma has raised an unusual dilemma: Which of the president's three wives will be the First Lady? There still has been no decision about how to handle the complication of electing the country's first polygamist president. Who will be his date to today's inaugural balls? And will the state have to provide medical care and security for the entire family, 19 children included? Local pundits wait for the drama to unfold.
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Happy Constitution Day!
Too bad it’s almost certainly unconstitutional.