I still maintain that the USA is so totally fucked to the point of absurdity. It is so bad that we have to enjoy the small things now. We are essentially a country comprised of grifters looking for cheap gadgets to comfort the impending doom. The entire scope of how utterly and completely screwed we are is being suppressed. Tonight was the season premiere of the Jersey Shore 2...and all over the news people lamenting about how them ringing the bell at wall street on Tuesday signaled the end of civilization. Its much worse than that. http://www.bloomberg.com/news/2010-...pads-while-broke-in-new-abnormal-economy.html
I think there's some real truth to the idea that there's an increasing divide between the folks who have jobs and security and those who don't. And while I read all sorts of econ blogs like Krugman, The Money Illusion and Marginal Revolution, it increasingly strikes me as odd how we overlook some of the obvious causes of so much unemployment. Could we not simply "solve a lot of our unemployment problem" by: 1. Repealing the minimum wage increases that raised the cost of employing your average worker just as the recession was getting under way (bonus points for noting that the states with the highest unemployment rates have even higher minimum wages - Nevada, Michigan, California, Rhode Island for example) 2. Repealing the recent (and continuing) extension(s) of unemployment benefits that removes most any incentive except the basic ethical one for unemployed folks to go out and actually find a job. 3. Repealing the health care act that's introduced a boatload of confusion, complication and cost into everyone's lives at a critically bad moment to do so. This probably goes for the financial "reform" legislation too. My guess is the first two policies would get us to 6-7%, and the last might get us back to our prior 4-5% baseline in relatively short order. Is there anything really controversial about this? These are all really basic, widely accepted employment economics concepts. Higher minimum wages increase unemployment. Higher unemployment benefits create higher reservation wages, which increase unemployment. The health and financial bills increased costs for business in some cases (the 1099 fiasco has been discussed here, to name one example), and have introduced a lot of uncertainty as to how folks are supposed to proceed. Businesses tend to not hire in the face of such things. But because we don't want to accept these basic realities of our legislative choices, we're all supposed to go out and think magically about monetary policy as a means of curing all of these problems?
My remedy for lowering the unemployment rate is this: Allow people to invest in US companies via various stock exchanges. If they keep their money invested for 2 years before selling, their max tax liability is 10%. After 3 years, 5%. After 4+ years, zero. That way companies will be flush with cash and able to spend for capitol improvements, expansion, new hires...
I don't think that'll do much because shares traded on stock exchanges are not newly issued. When you buy a share of a company, you're not giving money to the company, but to the current owner of the share. Who's just some guy like you and me. Now, if you limit your policy to investing in IPOs (initial public stock offerings) where a company is issuing new stock, then yes, you'll certainly funnel more money into the company. Even then, I don't see how that's a preferably policy to those I outlined. Mine improve the incentives for companies to hire and people to work across the board. Giving a company more money doesn't really change the incentive to hire more people. It creates the possibility, but doesn't guarantee it. There's lots of ways to spend that money.
If the government wants to lower unemployment, they need to eliminate the uncertainty surrounding companies. The people in the White House seem to have no idea how chilling the violation of the heirarchy of debt was for GM and Chrysler. Investors pump money into our economy because we're not a banana republic where someone's wealth is confiscated; yet that's exactly what the Obama Administration did with the bond holders of those two companies. Companies (including mine) are sitting on cash because we have no idea what out future obligations to the government are.
None of these is going to stop people from buying Flat Screens, trips and ipads when they're out of work or soon to be.......
I don't see the big problem. Someone isn't going to buy a new car but bought a big TV. To me that is like someone deciding not to vacation in Europe but instead at the coast. The writer is throwing around judgment on what people spend thier money on. basically implying that they aren't spending or saving their money the right way. Whatever. In this economy, people are going to choose more selectively where they spend their money and where they decide to save their money. But the bottom line is most are cutting back in some way. I'm glad that people are still deciding to spend money because that is good for the economy.
well, the trend nowadays is leading more and more to a pay-check to pay-check lifestyle or a disposible lifestyle. Since housing is kind of fucked, people will not put as much money in that and instead spend on fads and the latest gadgets.
It just shows how many morons we have here, and the weird entitlement mentality Americans have developed. They don't have jobs, they have $20k in credit card debt, and they are "cutting back" by buying a giant TV instead of a car? Slightly less moronic is still moronic.
I didn't read that in this article, but if that is the case: who is the moron, the person without a job, 20K in debt and buying the TV . . . or the credit card company or business that lends the money to allow that person to buy the TV?
What about the person who is 20K in debt with no job and now has a brand new big screen TV . . . which if they declare BK doesn't even have to pay for the TV?
So the credit card company works hard to make their profit. The dude who doesn't work gets a new bigscreen TV he doesn't have to pay for. The bigger moron is the person who didn't work and got something for it? I though you were all about minimal work for maximum gain.
