…Like A Housewarming For The Homeless

Debt,Economy,Government,Inflation,Labor,The State


A JOBLESS RECOVERY is the equivalent of a housewarming for the homeless. You have got to know that this sophistic term is a political construct, not an economic one. The term is meant to coat the entrenched, systemic effects of endemic, employment-killing government policies with a patina of scholarly respectability.

Typically, establishment economists will waffle about “structural changes—permanent shifts in the distribution of workers throughout the economy”—causing job losses, but will gleefully tout GDP growth, or some or other highly manipulable indicator, as evidence that the the jobless are fussing needlessly.

And here we return to square one: I am not sure that a vigorous recovery is even possible given government funded and unfunded debt amounting to upwards of $60 trillion, and counting. I don’t know that a country can surface from under all that. At the very least, a natural shift must take place—and be evident—from a credit-fueled, consumption-based economy, to one founded on savings, investment and production.

But, what do you know, the GDP statistic is consumption-driven: it measures the kind of economic Brownian motion of which less is required. “This statistic is constructed in accordance with the view that what drives an economy is not the production of wealth but rather its consumption,” confirms (Austrian) economist Frank Shostak. “What matters here is demand for final goods and services. Since consumer outlays are the largest part of overall demand, it is commonly held that consumer demand sets in motion economic growth.”

The prevailing “theory” of John Maynard Keynes “is not economics, but a statist political theory. Keynes’s political creed guaranteed a hand-in-glove relationship between the state and its stooge economists. Most of what Keynes advocated entails giving the state enormous … powers.”

Essential in this scheme of things is semantic obscurantism. “A Jobless Recovery” is exactly that.

So when you hear that “employers cut 467,000 jobs in June, far more than expected, and the jobless rate hit a 26-year high of 9.5 percent”; and that “wages shrank to their lowest in nearly a year,” consider these vital indicators of a moribund economy.

3 thoughts on “…Like A Housewarming For The Homeless

  1. Myron Pauli

    A healthy economy should always be destroying jobs – that is, via growth and efficiency. It is the growth and efficiency which creates new ones. The horse economy becomes the hand-made auto economy becomes the assembly-line auto economy becomes the robot-made auto economy. It is man’s intellect that allows 7 billion people to live far better than the few million Neanderthals of 100,000 years ago { Ayn Rand could say it far better than a quasi-literate scientist like myself }. Unfortunately, we have a government which:
    (a) creates phony and inefficient “make-work” political jobs, (b) counterfeits paper money, (c) punishes energy-using efficiency via “Green” bureaucrats and (d) enforces arbitrary regulations which stifle productivity. I recall that in 1972, Nixon pumped an extra $ 50 billion into the economy while keeping the price-lid on with “wage and price controls” which made the economy hum for his 49 state victory. In 1973, the Stagflation Monster rose up, overwhelming Nixon, Ford, and Carter. Similarly, we can have temporary fluctuations of prosperity but the long-term damage of the statists will send us into a Brezhnevian era of stagnation (accompanied most likely by hyperinflation).

  2. Bob Harrison

    We thought we had a “Jobless recovery” in 2003. Of course we now know it was much worse than just a jobless recovery but it was a false boom based on false property values resulting from Greenspan’s negative real interest rates in the aftermath of the tech collapse and 9-11. All the “economic growth” of the “Bush Boom” was nothing more than debt expansion. If you subtract mortgage equity extraction from the consumption data over the past 8 years we would be left with ZERO economic growth. That equity that was “extracted” is now gone.
    And Pharaoh Obamses seems like he wants to outdo Bush when it comes to damaging the economy. We’ve got zombie banks, zombie auto makers and coercive government policy (redundant?) in favor of the least efficient and most expensive forms of energy. I would have settled for drill-baby-drill over cap-and-tax!

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