Every time I read an article like this I wonder why we need 25 million MORE
poor, unemployed foreign workers via yet another amnesty law?Do
(both political parties)want jobs for Americans, or jobs for foreign
nationals?Who comes first?
Interesting point. But I think it misses the longer term shifts that have been
taking place. Work is less rewarded (rewarded to be certain, but less so),
there is less opportunity to rise to sand stay in the middle class, there is a
seeming disconnect between the work one does and the risks and pay received.We have become an economy that is entrepreneur focused. Nothing wrong
with entrepreneurs. They are key to a lot in the economy. But they alone are
not the working economy. The vast chunk of the working economy is workers. And
we seem to be in an ideological war against workers. Every business needs them
but we talk about them as if they were hangers on. Beggars to be given a crust
if that is our desire. Note that very successful companies don't do this,
but that is the talk you often hear.We need to get back to a point
we used to understand. We are indeed all in this together. The workers are not
our enemy. The govt. is not our enemy. The person who votes differently is not
our enemy.We have enough to do without creating enemies for
Interesting admission from a very right centered economist..this is a demand
driven recession, and rcovery. Where have we heard that before..oh yea, from
everyone other than conservative idealogues. That's why the stimulus,
worked to save a plumeting economy. It's the same reason austerity,
draconian deficit reduction, and the major overhaul of social services is
exactly the wrong approach.
While I agree with many of the points made, I would add another big one. The
government's recent shift to the left and its hostility toward businesses.
To many on the left (including most of the posters on this forum) businesses are
viewed the source of most of our problems. Big businesses, small businesses and
their owners (i.e. the wealthy) are the enemy that needs to be punished. Even
though they pay most of the bills, they are constantly demonized as not paying
their "fair share" by the far left (from the President on down).To give you an example: If radical environmentalists got their way,
owning cars would be greatly discouraged. They want to convince government to
jack up the taxes on gas, make parking expensive, raise insurance and
registration costs and requirements, and demonize their owners. Then everyone
wonders why fewer cars are on the road. The same principle applies to businesses
I always get a good chuckle out of articles that pretend to shed light on some
new theory for why things are the way they are. Not only does this article (like
most others) come up short, but he notes the one main reason early on –
deleveraging. And the rest of his article simply states the psychology behind
it. As households get back to more rational debt levels, spending
(and demand) will pick back up – no need for an Oracle to explain the
plainly obvious.More interesting is what’s occurring on the
supply (business) side (confession - this theory is not original to me).
American businesses, still under the spell of High Finance as a way to create
wealth (did they learn nothing from 2008?), hoard cash and are not investing in
income producing assets. This is the real source of risk-aversion and it’s
what happens when businesses are run by myopic bean counters focused on short
term returns vs. long term growth and innovation (the real drivers of demand and
standard of living increases).
Another interesting viewpoint from Samuelson. But he does miss one of the major
causes of our low employment figures. For 30 years now, we have tried
supply-side and trickle-down economics (they are similar but not the same).
Rewarding and encouraging investment at the expense of supporting demand has
left us with an economy that has plenty of available cash to invest but not
enough to purchase all the stuff corporations want to create. By the
same token, funneling as much money as possible to the already wealthy while
assuming that a little bit of that will trickle down to those lower on the food
chain is a proven dead-end street.Of course, almost all economists,
whether Keynesians or supply-siders or whatever else, see endless economic
growth as the cure to all our problems. But endless growth is a suicidal and
irrational philosophy in a finite world with finite resources. According to a
close relative who is a chemical engineer for Exxon, all the easy oil has
already been found and tapped. What's left is hard to reach, potentially
damaging to the environment, or expensive to refine (or all three).
I guess excessive red tape, too many government workers, high and complicated
taxes, among other things are not a factor.
lower taxes and get rid of Obamacare and watch what happens to the job market.
Liberals are not to be confused with economists.
Kent C. DeForrest: "By the same token, funneling as much money as possible
to the already wealthy while assuming that a little bit of that will trickle
down to those lower on the food chain is a proven dead-end street."I have noticed the same thing happening in the field of personal fitness. All
the muscles, strong hearts, energy, and slim figures are being
"funneled" to the already healthy (you know, all those people who
regularly control their appetites and get up and jog or bicyle every day) while
very little of it is trickling down to all the couch potatoes.Something must be done to force all those greedy, healthy people to give up
some of their health and redistribute it to all the fat, lazy people out there
who obviously deserve a bigger piece of it.
This notion of our “recent shift to the left” and all the
anti-business implications it suggests is, to put it bluntly, a myth. First, the
tax burden on the wealthy (including business) is the lowest it has been in
decades (lower than the booming 90’s and far lower than under Republican
presidents like Nixon and Eisenhower); while simultaneously businesses are
enjoying their highest profit margins in history. The interesting
question this raises is “why do people believe otherwise?” Businesses are always going to complain about taxes and regulations because
they only look at the cost side of the equation and not the benefit side. So
unless the rates on both are zero, they will gripe.Then if they can
start some media outlets where these gripes are broadcasts to millions and
served up with lots of patriotism, nostalgia, and Pavlovian button pushing (esp.
fear & anger), they can fulfill Goebbels prophecy that the truth is anything
repeated enough times. There are good reasons to be a conservative
(e.g., limited government, fiscal responsibility), but being one based on
distortions and lies is not one of them.
Joe:Sorry, but your analogy doesn't work. Getting up off the
couch and exercising is something you alone can control. Getting a job, when no
one will hire you, is quite a different matter. And the problem isn't that
people are lazy.Also, in our economy, we actually do redistribute
health, but it always goes from the bottom to the top. Those who actually create
the wealth do not get a proportionate share of it. Those who actually produce
very little reap most of the rewards. Don't try to tell me that a CEO is
really producing 500 times as much wealth as the assembly workers or programmers
Tyler D,Two great posts.Thank you.
If businesses are really making the largest profit margins in history, why
aren't those businesses borrowing to expand while the getting is good, and
interest rates are low?The reasons are many. The profits
aren't as great as you think.The country's economy is being run
in a way that will lead to yet another crash. Overextended companies perish when
things crash. (Which is part of what Samuelson said)The country's
economy is being pumped up on steroids, called deficit spending, which cannot be
sustained, and which will eventually compromise the economic health of the
country. More regulations are coming in this anti-business climate, which
makes taking on more employees very risky. (basically business has a bounty on
its head)People in the US would rather buy cheap things at Walmart, which
are made in China, than pay a little more to have them made here. The
entitlement class is growing in size and audacity. They will eventually vote all
the hard earned value of the business to themselves, and then squander it.It's not about business being greedy, it is about smart survival.
Total hogwash. The stock market has recoverd without recovery of the labor
market because American capital has disengaged from the domestic economy. They
have moved production to China and are more intersted in global markets.
re:Tyler DBusiness's don't hire when taxes are raises
Tyler. Do you want more job opportunities or less? The more taxes are raised the
less companies will hire. If I am standing in an unemployment line I sure
don't want to see more business taxes. I want a interview!
@Patriot – “Business's don't hire when taxes are raises
Tyler.”I agree… and despite what I said below,
eliminating taxes on business (any productive enterprise) altogether would be a
tremendous boon. Of course the devil is in the details, but even if
we assume no change in overall tax revenue to the government, it would likely be
better for our society as a whole if our tax base came from income (including
share holder distributions and dividends) and consumption.