Markets Alert
from The Wall Street Journal
"The U.S. economy continued to lose jobs last month as small gains in the private sector failed to offset big cuts in government workers, pointing to a still sluggish recovery.
Private-sector employers added only 64,000 jobs in September, the Labor Department said. Overall, nonfarm payrolls fell by 95,000 as temporary census workers were let go and state and local governments also cut employment.
The unemployment rate, which is calculated with a separate household survey, remained unchanged at a lofty 9.6% in September."
Not good news, obviously. But why has job growth been so painfully slow, now that the economy is growing again? What can be done about it? Are the nation's leaders doing the right things to speed up job growth?
I believe two important factors are working in tandem to keep job growth so slow. The first factor is structural and it will take years, not months to overcome. The second factor depends entirely on the laws the 545 have given us and could be changed in a few months.
The first cause of such slow recovery in job growth is a mismatch between skills and knowledge of the labor force, compared to skills and knowledge that businesses need to compete in the global economy. The simple truth is that American businesses no longer want as much of what the labor force has to offer, and certainly not at the wages the American labor force was enjoying before the Great Recession began.
As has always been true throughout the history of humans, technology has made it possible to produce more goods and services with ever decreasing quantities of human labor. That fact is lamentable if you are a worker whose labor is no longer wanted, but that fact is also the wellspring of the vast increase in human prosperity that most humans on the planet have enjoyed over the most recent 50 years past.
Each year, I ask my beginning economics students how it is that star athletes like Tiger Woods, Peyton Manning, and Kobe Bryant --- big, strong, capable laborers, all --- get paid so much to play games. Any number of answers students offer up catch a piece of the right answer, but students always miss one answer that is actually quite important. That answer is that we no longer need these fine specimens of human labor out in the field hoeing the corn. Technology has made that job quite unnecessary.
As recently as the year 1900, about 98 percent of the American population lived on a farm. They did so because that's were they could get enough food to stay alive. Today, less than 2% of the American population lives on a farm. Technology made living on farms to stay alive unnecessary. That same technology made countless jobs utterly unnecessary.
As humans learn more and more about the world and technology that gets embodied in capital goods --- machines, equipment, computers, and all the rest --- more and more human labor will become quite unnecessary. As a very direct result, when economic recession is brought on by the bungling of the 545 and the Fed, as it was once again in 2007, large numbers of workers will never be rehired to do the jobs they lost in the recession.
What can be done about this job-destroying fact? Certainly nothing that will be done by BHO, Washington and all the rest of the federal government. Individual people will simply have to recognize the mismatch between the skills and knowledge they have now and get to work on changing their skills and knowledge to better match up with the ever-advancing state of technology. There is no going back.
Extending unemployment benefits works exactly in the opposite direction of the only solution to the problem. Growing government and transfer payments also works in the opposite direction. Fortunately, lots of voters appear to be understanding more about how vacuous BHO and crews' policies are. Fortunately, November is just around the corner.
Retooling takes time; years, not months. Retooling will also require that the growth in transfer payments from Peter to pay Paul must stop. Creating new money must also stop. Transfer payments and more new money give people exactly the wrong incentives to do what will be necessary.
Anyone looking for a quick, policy-driven solution to this part of the slow-growth-in-jobs problem is looking for something that just isn't going to happen. Never mind the eloquent rhetoric of BHO.
The second major factor causing job growth to be so slow is the set of laws the 545 have given us --- laws that have placed a strangle hold on American productivity, ingenuity, and ambition.
Some of those laws are tax laws. America has an arbitrary, unfair, growth-choking federal income tax code. It could be fixed; read about it here.
Some of those laws are regulatory laws. The litany of regulatory laws that choke the American economy is vast, convoluted, and deeply ingrained. Getting rid of that body of law might be nearly impossible at this stage of the game. But we must try, just the same. We could start by repealing the enabling legislation recently passed for the new consumer finance agency.
Some of those laws rob Peter to pay Paul. Obamacare is the most recent example. Do you want to see even more loss of jobs in America? All we need to do is allow Obamacare to get under way. Yes, our health care system needs to change. Read how here. But Obamacare isn't the right change.
All those laws are counter productive, and they retard and inhibit the economic growth that simply will be necessary to return America to wide-spread economic prosperity. Read a really revealing explanation of these laws here. To read a compelling and accurate account of why we had a recession and what it will take to recover, read this.
This second important factor responsible for slow job growth can be changed, and we can get started on the task as early as next month. Join me in the New Blood Party. We are definitely in a hole; let's quite digging.
I believe two important factors are working in tandem to keep job growth so slow. The first factor is structural and it will take years, not months to overcome. The second factor depends entirely on the laws the 545 have given us and could be changed in a few months.
The first cause of such slow recovery in job growth is a mismatch between skills and knowledge of the labor force, compared to skills and knowledge that businesses need to compete in the global economy. The simple truth is that American businesses no longer want as much of what the labor force has to offer, and certainly not at the wages the American labor force was enjoying before the Great Recession began.
As has always been true throughout the history of humans, technology has made it possible to produce more goods and services with ever decreasing quantities of human labor. That fact is lamentable if you are a worker whose labor is no longer wanted, but that fact is also the wellspring of the vast increase in human prosperity that most humans on the planet have enjoyed over the most recent 50 years past.
Each year, I ask my beginning economics students how it is that star athletes like Tiger Woods, Peyton Manning, and Kobe Bryant --- big, strong, capable laborers, all --- get paid so much to play games. Any number of answers students offer up catch a piece of the right answer, but students always miss one answer that is actually quite important. That answer is that we no longer need these fine specimens of human labor out in the field hoeing the corn. Technology has made that job quite unnecessary.
As recently as the year 1900, about 98 percent of the American population lived on a farm. They did so because that's were they could get enough food to stay alive. Today, less than 2% of the American population lives on a farm. Technology made living on farms to stay alive unnecessary. That same technology made countless jobs utterly unnecessary.
As humans learn more and more about the world and technology that gets embodied in capital goods --- machines, equipment, computers, and all the rest --- more and more human labor will become quite unnecessary. As a very direct result, when economic recession is brought on by the bungling of the 545 and the Fed, as it was once again in 2007, large numbers of workers will never be rehired to do the jobs they lost in the recession.
What can be done about this job-destroying fact? Certainly nothing that will be done by BHO, Washington and all the rest of the federal government. Individual people will simply have to recognize the mismatch between the skills and knowledge they have now and get to work on changing their skills and knowledge to better match up with the ever-advancing state of technology. There is no going back.
Extending unemployment benefits works exactly in the opposite direction of the only solution to the problem. Growing government and transfer payments also works in the opposite direction. Fortunately, lots of voters appear to be understanding more about how vacuous BHO and crews' policies are. Fortunately, November is just around the corner.
Retooling takes time; years, not months. Retooling will also require that the growth in transfer payments from Peter to pay Paul must stop. Creating new money must also stop. Transfer payments and more new money give people exactly the wrong incentives to do what will be necessary.
Anyone looking for a quick, policy-driven solution to this part of the slow-growth-in-jobs problem is looking for something that just isn't going to happen. Never mind the eloquent rhetoric of BHO.
The second major factor causing job growth to be so slow is the set of laws the 545 have given us --- laws that have placed a strangle hold on American productivity, ingenuity, and ambition.
Some of those laws are tax laws. America has an arbitrary, unfair, growth-choking federal income tax code. It could be fixed; read about it here.
Some of those laws are regulatory laws. The litany of regulatory laws that choke the American economy is vast, convoluted, and deeply ingrained. Getting rid of that body of law might be nearly impossible at this stage of the game. But we must try, just the same. We could start by repealing the enabling legislation recently passed for the new consumer finance agency.
Some of those laws rob Peter to pay Paul. Obamacare is the most recent example. Do you want to see even more loss of jobs in America? All we need to do is allow Obamacare to get under way. Yes, our health care system needs to change. Read how here. But Obamacare isn't the right change.
All those laws are counter productive, and they retard and inhibit the economic growth that simply will be necessary to return America to wide-spread economic prosperity. Read a really revealing explanation of these laws here. To read a compelling and accurate account of why we had a recession and what it will take to recover, read this.
This second important factor responsible for slow job growth can be changed, and we can get started on the task as early as next month. Join me in the New Blood Party. We are definitely in a hole; let's quite digging.
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