Jobs
It is an economic fact of life that for
anything for which there is a demand, a supply will always become available to
meet it, whether the demand is for government services, automobiles, groceries,
doctors, hospitals, drugs, or whatever. Where there is no demand, there will be
no supply; and, therefore, no jobs–jobs being a function of supply. This sounds
overly simplistic; but it’s the bottom line–believe me. The key word here is “demand”. Demand can
only come from the people, i.e. the consumer, the user. An increase in the
demand for government services will result in an increase in government jobs; an
increase in the demand for automobiles will result in an increase in automotive
jobs; an increase in the demand for housing will increase in construction jobs;
an increase in the demand for healthcare will result in an increase in those
jobs, and so on. As we cry for more jobs in these trying times, we must
understand that only our people can create jobs, and that is through their
demand. There is no other way. In the final analysis, jobs are not a function
of government. If the politicians tell you differently, they’re either ignorant
or liars. This isn't a Democrat Rule; this isn't a Republican Rule; this is a law
of economics. Like gravity, only God can change it.
We now get down to the hard part of
this discussion–the really hard part. There is another economic fact of life: whosoever
demands must pay for his supply. He may pay cash; he may borrow the money; in
the case of demand for government service, he may pay through increased taxes;
or, he may pay through the benefit of welfare– also paid by taxes, through
which someone else must pay for him. In addition, one should take note that when
government services are increased and taxes are not increased accordingly,
government borrowing is incurred for which we are liable, also. Either way, sooner
or later, “the piper” must be paid. As Milton Friedman is said to have said (I
didn’t hear him personally), “There is no free lunch”.
Before we can go from here in this
discussion, we must, also, understand that as a whole, our nation and people
are in debt “up to our ears”. We may or may not be “maxed out”. That’s arguable.
But we are certainly not in a position to continually take on more debt with
impunity as we have in the past. For the past seventy-plus years, we have been
living a false prosperity far and above our real productivity because we have
been living above and beyond our means–our income. We have been living on
borrowed money, personal as well as government.
Stated in a different manner, our
nation’s demand, government and private, over these years has been excessively,
and therefore, artificially high relative to what it would have been in a normal
economy without our many wars (WWII, Korea, Vietnam, Balkans, Iraq, Afghanistan,
etc.) and consumer spending “on the cuff” over and above income. This has been grossly
exacerbated by the fact that, although we pretty much paid as we went, so to
speak, through the end of the Carter administration (our national debt then, was
under $1 Trillion, the closest to zero we’ll ever see in our lifetimes), our
national debt after that literally exploded, increasing 1,004% by the time G W
Bush left office (the surplus he inherited from Clinton notwithstanding); and,
after that, another approximately $7 Trillion (or 70%–almost double) to the approximately
$17 Trillion where it stands today under President Obama (after the financial
crash of 2008). The artificially high government and public demand in the past
really translates into an artificially high number of jobs then relative to the
demand (jobs) today as we pay down our enormous government and private debt.
I really hope I have adequately
explained what I have just said, folks, as it translates to me, that there isn't going to be any significant increase in demand and, therefore, jobs until we
can, at the very least, pay down our debt–both government and private. For
private debt, this means credit cards, second mortgages, and student debt,
especially. For government debt, this means we must first eliminate our annual
deficit spending. You have to quit adding to debt before you can subtract from,
i.e. reduce, it.
In conjunction with this, let me call
your attention to two more factors. First, in the “Final Report of the National
Commission on the Causes of the Financial and Economic Crisis in the United
States”, issued January, 2011, it was reported that twenty-one million people
were out of work in this country. I can’t provide you the profile of this group
of people. It’s not available to me. But please allow me to speculate, and you
make up your own mind. Most all the new jobs we are told are being added to
today’s workforce are being filled by those who are newly entering the
workforce (an estimated 250,000 per month or so–I can’t remember the time
period for certain), and most all of those twenty-one million originally laid
off are still unemployed. Those entering the workforce are young, cheaper
(lower paid), better educated, more efficient, etc. As to those laid off, I don’t
believe most of them will ever find a real job until they die. They are, most
probably, over fifty, obese, poorer health, aren't as good at relating to
people, less efficient, on the verge of receiving their retirement pension,
etc., etc.–all those reasons why companies want to clean house and get rid of
their less favored and productive employees. Second, outside of certain service
jobs, most new jobs will require higher level technical skills than in the
past.
My conclusion is that it will be a
long time, a very long time, if ever; before we can increase our demand and our
economy will revive again. We have too many negatives working against us–our
sins of the past as well as our sins of the present. In all honesty, I do
believe we can correct our course and recover; but we will not unless we change
our mindsets and way of doing things–especially in government and in the
involvement of our people. With freedom goes responsibility.
Ronald
Miller
mtss86@bellsouth.net
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