Posts Tagged ‘unemployment’

Got Jobs?

To paraphrase a well known quote: “A recession is when your neighbor loses his job. A depression is when you lose yours.” Two of my friends are out of work and it seems to be a long term deal. Both are highly qualified and experienced. I have personally lost a great night job I held for years and have not been called in to work since August, 2008. How are you and your acquaintances doing these days?

Opportunity in America starts with a job. Without one, there is no security, no earnings or savings, and no satisfaction and self-esteem of contributing to ones future or society. Official unemployment stands at 9.5% and if those who are under employed are added in, it becomes over 17%. Here is a short clip about how onerous regulations hurt the economy. It only touches on a couple of the several items mentioned below:

Do we want our jobs back? – YES! OK, just how can this goal be accomplished?

Business creates new jobs when it expands. Most large firms are sitting on their cash because they are uncertain of the future. In fact – several big companies that have announced expansion plans have been savaged by the stock market recently instead of rewarded. Investors are not confident that growing business is a smart move at this time.

Small business is fighting the combined headwinds of low demand, burgeoning new regulations, and great difficulty obtaining financing. This sector of the economy which traditionally creates the most jobs is stalled.

The Obama Administration has passed or is pushing legislation that has emasculated businesses large and small, putting great fear into owners and investors and hampering economic recovery. If we want our jobs back, these monstrous legislative overreaches must be rolled back. Here they are:

$867 Billion Stimulus: This program borrows nearly a Trillion Dollars from China and others against the future earnings of all Americans. It was promised as a method to initiate “shovel ready” infrastructure work. Instead most has been spent on the state level preserving government jobs.

Health Care: This massive takeover of 1/6 of the entire economy has created unintended consequences of huge proportions. It threatens to crush small businesses’ health plans and drive workers into the government system. The true long term costs to both business and individuals cannot be accurately calculated, and the implied costs were buried deep in the overall effort to pass the Bill.

Financial regulation: The Dodd / Frank legislation supposedly regulates financial practices while ignoring completely the malfeasance at Fannie Mae and Freddie Mac that contributed so greatly to the 2008 meltdown. Draconian rules and regulations will trickle down to the smallest mom & pop business and stifle initiative and productivity with reams of reporting requirements, paperwork, and red tape.

Cap & Trade legislation: Currently passed in the House and stalled in the Senate, whispers have it that a lame duck session of congress after the November election may pass it in the Senate anyway. This myopic and hysterical “solution” to a problem that has not been proven as fact would saddle business with huge energy cost increases. It would drive literally millions of American jobs overseas in a pen stroke.

Expiration of the Bush Tax Cuts: John F. Kennedy, Ronald Reagan, and George W. Bush all lowered taxes in the face of a recession. All three saw a spurt in economic growth and jobs as a result. The Obama Administration intends to raise taxes at the end of 2010 by allowing the current cuts to expire. Raising taxes punishes investment, expansion, success, and hiring. This scheme is a recipe for prolonging the worst recession in 75 years.

The Obama Administration has caused more damage to the US economy in 18 months than Jimmy Carter managed in 4 years. The only way to have a prayer of turning things around for the better is to change Congress this year so opponents can block funding and implementation of some of the more destructive aspects of the Obama agenda.

For you, your friends, your neighbors, and your children: THIS IS THE MOST IMPORTANT ELECTION IN OUR LIFETIMES.

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Obama’s Hockey Stick

“I say after eight years of this Administration we have just as much unemployment as when we started. … and an enormous debt to boot.”

These were the words of Treasury Secretary Henry Morgenthau spoken to Congress in May, 1939. Exasperated after experiencing massive unemployment for 10 years and spending heavily year after year to try to end it, Morgenthau was a beaten man. He was admitting that massive government spending and make-work projects had failed to revive the American economy. Over that period, unemployment had peaked at 25%, never went below 14%, and was 20% again when those words were spoken.

Now we have an administration in office that is mimicking the acts of the Roosevelt years with unprecedented borrowing and spending in their attempt to revive the economy. No less than Vice President Joe Biden recently stated: “We have to go spend money to keep from going bankrupt.” These people refuse to acknowledge history.

Below is a graph which I call “Obama’s Hockey Stick”. The environmental “hockey stick graph” has been discredited, but this one is frighteningly real. It shows that the US Budget Deficit has gone over a cliff; the deficit quadrupling between 2008 & 2009.

The next graph is projected future deficits based on present government budget plans. One estimate is from the Obama Administration, the other from the Congressional Budget Office (CBO):

The plunge in 2009 (which added $6,065 of debt for every living American) appears to begin to recede in 2010 and after until retracing back deeper starting in 2013. Note that the White House projections are far more optimistic than CBO. Who are we to believe; an administration attempting to cling to power, or a non-partisan budget watchdog? No matter which is right, the scenario is dire.

Based on 1933-41 experience, the above projected deficits appear a recipe for disaster. Government borrowing sucks available capital out of the system starving business of loans to expand and hire. Interest rates will rise choking off recovery of the housing market. Taxes will be raised to pay both the debt and interest; draining vital earnings of firms and individuals for decades to come.

Deficit spending does not create recovery; it only buys votes today with the fruits of future labor. Our government is selling our children’s future down a rat hole. Next time you see a baby, think seriously about apologizing in advance.

Here is a cute one that has been around a while about the TARP bailout: