Where will jobs and growth come from? As we enter the fifth year of the Great Recession, people all over the world are asking this question, but their political leaders are not providing any convincing answers, as has been made obvious in the U.S. presidential debate and the European Union summit this week.

The second presidential debate started with Jeremy Epstein, a 20-year old college student, pointing out that he had “little chance to get employment” and asking the two candidates for some reassurance and an explanation of how this would change. Mitt Romney offered lots of reassurance but not much explanation:

“I want you to be able to get a job. I know what it takes to get this economy going. I know what it takes to create good jobs again. I know what it takes to make sure that you have the kind of opportunity you deserve. When you graduate … in 2014, I presume I’m going to be president. I’m going to make sure you get a job. Thanks, Jeremy. Yeah, you bet.”

President Obama was more specific but hardly more convincing:

“No. 1, I want to build manufacturing jobs in this country again. That means we change our tax code so we’re giving incentives to companies that are investing here in the United States. It also means we’re helping them and small businesses to export all around the world. No. 2, we’ve got to make sure that we have the best education system in the world. No. 3, we’ve got to control our own energy.  We’ve got to reduce our deficit, but we’ve got to do it in a balanced way. And let’s take the money that we’ve been spending on war … to rebuild roads, bridges, schools. We do those things, not only is your future going to be bright but America’s future is going to be bright as well.”

Tinkering with taxes and investing in education, energy and roads may be good ideas, but does anyone believe such measures would resolve the deepest and most intractable unemployment problem that the U.S. and the world have faced since the 1930s?

Actually, somebody does seem to share Obama’s optimism: the European Union. Here are the takeaways from the “Compact on Growth and Jobs” prepared for this week’s EU summit: Investing in Infrastructure; Deepening the Single Market; Connecting Europe; Promoting Research and Innovation; Enhancing Competitiveness; Creating the Right Regulatory Framework; Developing a Tax Policy for Growth; Boosting Social Inclusion; Harnessing the Potential for Trade.

These are all worthy aims, just as the goals in Obama’s laundry list are, but they are exactly the policies that Europe has been trying to implement for the past four years, while unemployment has relentlessly risen. Why should they suddenly answer the desperate need for new jobs?

This question actually has a clear answer. But it is an answer that seems difficult for policymakers to articulate, not because it is too complicated but because it cuts across ideological divisions.

The challenge of job creation demands a two-part answer — and unfortunately these two parts appeal to opposite ends of the political spectrum. Creating new jobs and economic activity depends on private enterprise, and it is unclear whether government policy can do anything much to inspire the next Google or Starbucks. But just as important as creating jobs is restoring the old jobs destroyed by recession – and this job recovery depends primarily on the actions of governments and central banks.

The tens of millions of jobs lost globally in construction, retailing, hospitality, autos, household goods and other traditional industries since 2008 were not destroyed by a sudden breakdown in entrepreneurial zeal. They disappeared mainly because of collapsing consumer incomes, asset prices, credit and other macroeconomic dislocations.

To overcome the global crisis of unemployment, new jobs in new industries have to be created, just as old ones must be restored. But because job creation is associated with conservative deregulation, while job recovery points to Keynesian demand stimulus, the policies required to achieve these two objectives often seem to be in contradiction. The starkest case is in Europe. Greece and Spain are promised development through structural growth policies that encourage competition and deregulate labor. At the same time they are forced to impose deflationary fiscal policies that guarantee permanent recession and ever-rising unemployment. The result is a disillusioned populace, as both structural and macroeconomic policies are seen to fail.

Yet if not for ideology, structural and macroeconomic employment policies could be viewed as mutually reinforcing. If macroeconomic stimulus pulls the economy out of recession and preserves jobs in existing industries, that helps strengthen new businesses – at least until the economy approaches full employment and further stimulus starts to push up inflation or interest rates. At that point, old industries start to compete with new ones for workers and government spending “crowds out” private enterprise. That is when reductions in public spending and budget deficits become important to allow the private sector enough leeway for growth. When the economy is still in recession, by contrast, cuts in government spending and efforts to narrow deficits do not liberate private enterprise; they merely starve new business of incomes and demand.

Many politicians seem to think such ambiguities are too complicated to explain to voters. Nobody seems to advocate job-creation plans that combine conservative policies to promote competition and enterprise with Keynesian fiscal stimulus to boost demand. But this combination is plain commonsense. Driving a car requires a gas pedal, a brake and steering wheel, and these must be used in different combinations at different times. Voters are surely capable of understanding this; the question is whether politicians can understand it, too.

PHOTO: U.S. Republican presidential nominee Mitt Romney (L) and U.S. President Barack Obama speak directly to each other during the second U.S. presidential debate in Hempstead, New York, October 16, 2012.  REUTERS/Mike Segar