Category Archives: Labor

Updated: 'Don’t Bet On A Recovery'

Debt, Federal Reserve Bank, Inflation, Labor, Uncategorized

PETER SCHIFF CHALLENGES “those who fantasize about a consumer-led recovery to describe where the spending money will come from. Most consumers are tapped out, millions are unemployed, and home equity has been wiped out. The only reasonable thing for them to do is to pay down debt and sock away as much money as possible to rebuild their savings.

Beyond the question of ‘how’ the spending could be achieved, is the deeper question of ‘why’ such activity should be sought at all. Excessive spending, fueled by an insane housing bubble and catalyzed by reckless monetary and fiscal policy, was the reason that our current recession became unavoidable. Why would we want to go down that road again?

During the run up to the crash, excess spending had created economic distortions that have yet to be resolved. Too many resources, including land, labor, and capital, were devoted to servicing an unsustainable economic model in which Americans borrowed money to buy homes, products and services they really could not afford. In many cases consumer behavior was influenced by overly optimistic assumptions regarding real estate related riches.

However, now that the real estate bubble has burst, Americans are coming to terms with a more sober reality. Many have cut up their credit cards, dramatically reduced their spending, and have squirreled away as much money as they can. This change in behavior should necessitate a dramatic shift in the labor market as workers move away from jobs associated with consumer spending and toward jobs associated with real production, primarily for exportable goods.

The real problem is that monetary and fiscal policy designed to re-inflate the burst spending bubble is preventing this transition from taking place. As a result we are not creating the jobs we need to replace – the ones we have lost in mortgage servicing, home improvement, and real estate sales (which we never really needed to begin with). As these jobless remain unable to find alternative employment, our economy will continue to languish.

Some will argue that the new jobs created by government stimulus spending will provide the additional purchasing power necessary to revitalize consumer spending. There are two problems with this expectation. First, those jobs being ‘created’ by the government are outnumbered by those being destroyed by government domination of resources. Second, even if it were possible for job growth to return, having hopefully learned from their mistakes, workers will be far more frugal with their paychecks than they were in the past.”

The complete column is HERE.

Update: From the U.S. Bureau of Labor Statistics comes “THE EMPLOYMENT SITUATION — FEBRUARY 2010.” It’s not good.

Updated: ‘Don’t Bet On A Recovery’

Debt, Economy, Federal Reserve Bank, Inflation, Labor, Uncategorized

The complete column is HERE.

Update: From the U.S. Bureau of Labor Statistics comes “THE EMPLOYMENT SITUATION — FEBRUARY 2010.” It’s not good.

Updated: ‘Conservatives’ Pine For Post Office

Affirmative Action, Debt, Free Markets, Labor, Multiculturalism, Republicans, The State

Chuckie Krauthammer hasn’t visited a United States Postal Service office lately. As a regular on Bret Baier’s Special Report, he was asked to prognosticate about the future of the USPS monopoly I described thus:

Having used the Canadian, South African and European equivalent services, I can safely say that there is no viler or more inhospitable dump than the United States Postal Service. The latter is far and away inferior to the aforementioned rival monopolies. Enviously I eye the items my mother posts from the Netherlands. Whereas mine are festooned with at least two labels per package; hers are form-free, care free, shipped with ease.

The Postal Service is in the red, for a change, “could lose a staggering $7 billion this year,” and “posted $3.8 billion in losses last year.”

The fattened Postmaster General John Potter is seeking some kind of mandate (and funding presumably … from China) to “move the Service forward.” He wants to “reinvest, redefine and reinvigorate the value of mail to business and households.”

Fighting for the USPS, its “$70 billion in unfunded liabilities, and the parasitical existence of 800,000 postal workers who live off the Federal Financing Bank (read: the taxpayer),” is Republican Sen. Susan Collins, R-Maine.

“If you cut back services, you’re going to lose customers,” she stammered, as if the USPS has “customers”; it has captives, pinned down like butterflies by grotesque “service providers.”

In the name of tradition, Chuckie Krauthammer expressed nostalgic sentiments for the postman who came no matter the weather, and recommended rehabilitating this institution.

As I said, he clearly has not frequented a post office in a while. It’s a monument to the multicultural Managerial State and is packed with sour, affirmative action hires who speak in tongues. Grandma in a remote hamlet is unlikely to get her mail delivered by a friendly old timer. Oh no, those government jobs are reserved for “minorities.”

Update (March 3): A reminder: this post is about conservatives supporting the continued nationalization of a service delivered magnificently and morally by the free market. I’m sorry liberty lovers feel it is unworthy of their attention.

‘More Government Equals Fewer Jobs’

Debt, Economy, Government, Labor, Regulation, Socialism, Taxation

My own version of the title’s maxim invoked “zero-sum economics, or parasite vs. host. The larger the parasitical sector gets, the weaker the productive host will grow. The first is sucking the lifeblood of the second.”

Peter Schiff expertly drives home the principle in his latest column:

“The fiscal 2011 budget proposed by President Obama contains $3.8 trillion in federal spending. Think of government as a cancer feeding off the private sector. The larger it grows, the more jobs it kills. Unfortunately, most politicians follow the misguided advice of economist John Maynard Keynes, who advocated government spending as a means of job creation. In reality, government spending merely results in government jobs replacing more efficient private sector jobs.”

Read on about the effects of regulation, subsidies and, yes, tax cuts when borrowing continues apace. As they bay for the tax-cuts panacea, I bet beautiful Sarah and her supporters have not figured out that:

“… a dollar borrowed kills more jobs than a dollar taxed. Therefore, cutting taxes and borrowing the shortfall kills more jobs then [sic] it creates. This is true because jobs require capital and government borrowing more directly crowds out private capital investment than taxes do.”

Bush, I noted in “Deficit Disorders,” cut taxes while “spending like there was no tomorrow—for every dollar that may or may not remain with its rightful owner, the president blew tens of non-existent bucks on brand-new spending.” And, “Each of the morally bankrupt parties has used tax cuts as a decoy to avoid addressing the cause of the deficit: government’s spending more than it steals.”