Obama and the Democrats have been making a lot of noise about the fact that corporations are sitting on an estimated $1.8 trillion in cash when they could be using that money to hire people. Some even accuse businesses of collectively not hiring because they want to make Obama look bad so he won't be reelected.
But, the simple fact is that businesses aren't hiring because there is no need to. The existing aggregate workforce is adequate enough to keep the shelves stocked with product and provide all the services that Americans are willing to buy. Supply isn't the problem. We have a demand problem in this country. The reality is that the consumer is MIA in the economy and, as long as this condition exists, hiring will remain stagnant.
Consumer spending is down because the average paycheck is being squeezed by a falling dollar and the resulting higher prices for food, clothing, and energy. Then, too, state and municipal governments are also squeezing the paychecks through higher taxes on everything and anything as they try to cope with their balloon debt. The housing market is stalled despite record low mortgage rates, because potential home buyers either don't have enough cash for a down payment of 20% or they can't move out of their existing homes because they are so far underwater on their mortgages.
If, as a country, we would solve the above issues, then our economy will grow again and hiring will resume. But, once again, the Democrats want to use corporations as scapegoats for their own inept handling of the economy. Higher food, clothing and energy prices are a direct result of excess government spending; driving the value of the dollar down and import prices up. Rising gasoline prices are also due to our lack of domestic drilling for oil. Higher state and municipal taxes are actually exacerbating the lack of state revenues because consumer spending is being retarded; resulting in less sale tax revenues and less business income tax collections.
And, then, the housing market. Lower interest and mortgage rates aren't doing it. We need a program that would relax some of the down payment requirements. While, before the housing crisis, any warm body could get a loan, today the pendulum has swung too far and loan requirements have become too restrictive. I suggest we have a federal, interest free, down payment matching program that would cut the home buyers 20% down in half. In doing so, the federal government would become a lien holder against the purchased home. Repayment would be on a 10 year basis as part of the mortgage payments; or, in total if the home is sold within the 10 year repayment period. It would also help if the mortgage lenders would rollback mortgage payment rates on Adjustable Rate Mortgages to 2007 levels; thus stemming the high rate of foreclosures.
Doing what I have pointed out will create more jobs than Obama's short-sighted and probably ineffective jobs plan. Unfortunately, Obama will probably get what he wants and, come November of next year, things will only be worse.
Showing posts with label creating jobs. Show all posts
Showing posts with label creating jobs. Show all posts
Monday, October 10, 2011
Friday, September 16, 2011
The Stimulus Package Job-Creation Deception
I must have heard this said a hundred times: The Stimulus Package has saved or created 2.5 million jobs. In fact, the President and Vice President have staked this claim in numerous speeches. But, there's a couple of big problems with that claim.
First, the number of unemployed Americans in this country has gone from 11.1 million, when Obama took office in January of 2009, to today's 14 million. That, to me, is a loss of 2.9 million unemployed when the Stimulus Package was supposedly creating 2.5 million jobs.
Secondly, according to the data provided by the Bureau of Labor and Statistics (BLS), the workforce has remained relatively flat at 154 million workers over the last 32 months. This despite additions through normal population growth. In reality, the workforce should have grown to just under 160 million by now. But, instead, it lost all that growth because, statistically, 6 million workers are being categorized as "discouraged." In a nutshell, a discouraged worker is a special unemployed individual who is no longer being counted as part of the workforce because they, for a variety of reasons, have temporarily stopped looking for a job. Usually, when the employment picture improves, these people will start looking for work again and, then, will be counted back in as a valid unemployed worker. Of course, when this happens, the number of unemployed and the unemployment rate will both rise in response.
While the Stimulus Package might have a legitimate claim to having created some jobs, it's hard to tell when looking at the situation from the top down. That's because, as so noted above, our economy has shed nearly 9 million jobs since Obama took office and since the enactment of the Stimulus bill. That's the reality and that's the truth that is being intentionally hidden when the President claims that the Stimulus Package has created jobs. People understand this and that is why 3 or 4 to 1, Americans give Obama a failing grade on both jobs and on the economy.
First, the number of unemployed Americans in this country has gone from 11.1 million, when Obama took office in January of 2009, to today's 14 million. That, to me, is a loss of 2.9 million unemployed when the Stimulus Package was supposedly creating 2.5 million jobs.
Secondly, according to the data provided by the Bureau of Labor and Statistics (BLS), the workforce has remained relatively flat at 154 million workers over the last 32 months. This despite additions through normal population growth. In reality, the workforce should have grown to just under 160 million by now. But, instead, it lost all that growth because, statistically, 6 million workers are being categorized as "discouraged." In a nutshell, a discouraged worker is a special unemployed individual who is no longer being counted as part of the workforce because they, for a variety of reasons, have temporarily stopped looking for a job. Usually, when the employment picture improves, these people will start looking for work again and, then, will be counted back in as a valid unemployed worker. Of course, when this happens, the number of unemployed and the unemployment rate will both rise in response.
While the Stimulus Package might have a legitimate claim to having created some jobs, it's hard to tell when looking at the situation from the top down. That's because, as so noted above, our economy has shed nearly 9 million jobs since Obama took office and since the enactment of the Stimulus bill. That's the reality and that's the truth that is being intentionally hidden when the President claims that the Stimulus Package has created jobs. People understand this and that is why 3 or 4 to 1, Americans give Obama a failing grade on both jobs and on the economy.
Thursday, August 18, 2011
Obama On Jobs, Again!
Even before Obama got into office, his mantra has always been: Jobs! Jobs! Jobs! We've been told "by him" that, since he took office, he wakes each morning and goes to bed each night thinking about ways to create "jobs".
But, now, with nearly 1000 days in office under his belt, unemployment has climbed much higher than it was when he moved into 1600 Pennsylvania Avenue. With continued high unemployment, falling poll numbers, and increasing prospects of a one-term presidency, he's going to announce another jobs initiative; acting as if unemployment is now, somehow, something suddenly new.
One would think that, after spending nearly 1000 waking mornings thinking about ways to create jobs, a jobs plan would just roll off his tongue. But, no. Instead we have to wait another half month or more for him to unveil his latest -- let me guess -- spending and debt-ridden big-government masterpiece. In the meantime, another 400,000 plus Americans will continue to hit the unemployment lines each month with 15 million out of work already and with another 11 million out of work and totally discouraged from even looking for work.
In typical Obama fashion, the unveiling will be done through a "major economic speech" to be delivered sometime in September. Is there ever a speech given by this guy that isn't labelled as a "major speech"? I, for one, am tired of all his speeches without any real, documented plans; and, the polls show that most Americans are too!
But, now, with nearly 1000 days in office under his belt, unemployment has climbed much higher than it was when he moved into 1600 Pennsylvania Avenue. With continued high unemployment, falling poll numbers, and increasing prospects of a one-term presidency, he's going to announce another jobs initiative; acting as if unemployment is now, somehow, something suddenly new.
One would think that, after spending nearly 1000 waking mornings thinking about ways to create jobs, a jobs plan would just roll off his tongue. But, no. Instead we have to wait another half month or more for him to unveil his latest -- let me guess -- spending and debt-ridden big-government masterpiece. In the meantime, another 400,000 plus Americans will continue to hit the unemployment lines each month with 15 million out of work already and with another 11 million out of work and totally discouraged from even looking for work.
In typical Obama fashion, the unveiling will be done through a "major economic speech" to be delivered sometime in September. Is there ever a speech given by this guy that isn't labelled as a "major speech"? I, for one, am tired of all his speeches without any real, documented plans; and, the polls show that most Americans are too!
Thursday, August 11, 2011
Obama's Idiot Economics: Extending Unemployment Insurance Creates Jobs
On the 8th of this month, Obama gave a speech whereby he claimed that extending unemployment insurance would create jobs, (Click to See the Video). Then, today, the President's spokesperson, Jay Carney, reiterated that claim by saying that extending unemployment benefits would actually create a million new jobs (Click here to See that Video). But, this is not a new idea for any Democrat. Just last year, that wizard of economics, Nancy Pelosi, said exactly the same thing (Click to See that Video).
By implication, Pelosi, Carney, and the President seem to be saying that unemployment is a good thing. In fact, one could deduce that if every American lost their job, millions of new jobs would be created; simply thanks to unemployment insurance. That's not Keynesian economics. In fact, it's not even Voodoo economics. It's just plain "Idiot" economics.
Our economy is 70% driven by consumer spending. When someone loses their job and goes on unemployment insurance, at the very minimum, half their previous income is just completely gone from any consumer spending activity. If anything, this loss of consumer spending will have a ripple effect in causing even more job losses. It certainly doesn't create any new jobs (except, of course, more and more government "union" jobs to handle all the new and continued unemployment claims). The only real benefit that unemployment insurance has to the "overall" economy is that it slows down the ripple effect so that unemployment doesn't completely spiral out of control by feeding on itself.
With that, you can now understand why this President and the Democrats can't get this economy growing again!
By implication, Pelosi, Carney, and the President seem to be saying that unemployment is a good thing. In fact, one could deduce that if every American lost their job, millions of new jobs would be created; simply thanks to unemployment insurance. That's not Keynesian economics. In fact, it's not even Voodoo economics. It's just plain "Idiot" economics.
Our economy is 70% driven by consumer spending. When someone loses their job and goes on unemployment insurance, at the very minimum, half their previous income is just completely gone from any consumer spending activity. If anything, this loss of consumer spending will have a ripple effect in causing even more job losses. It certainly doesn't create any new jobs (except, of course, more and more government "union" jobs to handle all the new and continued unemployment claims). The only real benefit that unemployment insurance has to the "overall" economy is that it slows down the ripple effect so that unemployment doesn't completely spiral out of control by feeding on itself.
With that, you can now understand why this President and the Democrats can't get this economy growing again!
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