Catch the first glimpse of my column at NBCNews.com’s Lean Forward blog. Please go there, read there, spread the word and comment if you feel it—they’re supporting my work and deserve the traffic.
NBCNews.com Blog: To the Candidates: Lead – or Follow and Get Out of the Race
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7 Comments.
Good column, though it looks like many of the Obama bots on MSNBC.com didn’t quite like you questioning or impartially judging “fearless-leader.” On the plus side, a few comments at the very bottom seem to be from people starting to become aware of things. So, at least there is some progress – keep trying.
Permanent unemployment insurance? Thanks, but no thanks. How pathetic. We’ve already got a nation of freeloaders, white trash who sit in their trailers, do meth, collect bogus disability insurance payments, and leech off the rest of us. In fact, the correct solution is NO unemployment insurance. That would have the dual effect of forcing this government to make laws that keep jobs here, and keep them plentiful, while also cutting off the freeloaders who clearly have no intention of making efforts toward gainful employment.
Life is work. The notion of not having to produce in exchange for the necessities of life is unnatural. Only humans could devise such an unnatural and immoral scheme.
Ah, the plant betrays his right wing beliefs, yet again. And if you’re that concerned about things that are “unnatural”, I suggest you get off the Internet, turn off your computer and go climb a tree.
Actually, I suggest you do that anyway.
Ah, the retard betrays his inane stupidity, yet again. Just how fucking stupid is Whimsical?
– His (its) brain cannot compartmentalize ideas that fall outside of strict ideological boundaries.
– His (its) idea of a “plant” is one that overtly espouses the very ideas that make him a “plant”.
In all seriousness, there’s trolls, there’s retarded trolls, there’s retarded ideologue trolls, and there’s Whimsical.
As far as what’s natural goes, I suggest you buy a gun and put a bullet in your own brain. It’s not being used …. the brain that is.
@ exkiodexian:
Okay, I think we can actually have an interesting conversation on this one if you are willing to overlook the bad start arising from Whimsical’s random unprovoked aggression. I am not suggestion either of us will be able to convince the other but I do actually respect your views on these matters as you are an intelligent and well-reasoned individual I just disagree with your views very strongly.
Lets start here: “Life is work. The notion of not having to produce in exchange for the necessities of life is unnatural. Only humans could devise such an unnatural and immoral scheme.” I actually agree with this, at least in its simplest and most general form. However I argue that the “unnatural and immoral” perversion to life that has potentially made unlimited unemployment benefits a necessity for modern society has actually started in the private sector, and only in recent times. Don’t worry, this isn’t a baseless assertion (it may be wrong but it won’t be baseless) I will explain it following this it just will take a number of large paragraphs.
If you go way back in time, say 1000 years or more, there really was an unlimited amount of work to be done. Anyone who wanted to work could do so and could do as much of it is he or she wanted and had the capacity to do. Even 200 and possibly as recent as 100 years ago this was still much closer to being true then it is now. In such a situation I am in full agreement with you about your take on unlimited employment benefits: they would damage society by providing an incentive not to work. This would be incredibly bad in those older eras when the limiting reagent to further progress in society is more work. Indeed if I had lived in those times and yet had the same world view I do now, based on the way the world worked at these times (main socio-economic issues = supply side issues) I actually would have had a pretty hard-line libertarian stance that would look much like yours does now, instead of the almost diametrically opposed socialist views I currently take.
What has happened in the modern world, however, is that technological innovation has made individual worker productivity so high, that the obvious and unavoidable microeconomics efficiency optimization of the free market causes it to destroy itself, and the rest of society with it. How does this work? Well in short people are now more productive then a maximizing effective free market can support. Back in the day a farmer could work all year and create enough food for about 6 other people. Thus at least 1 in 7 people needed to be farmers thus guaranteeing over 14% employment in any society right there as a baseline. Then when you remove children the old and those otherwise unable to work suddenly this becomes like 30-40% baseline employment. However the last figure I saw was that most modern farmers in industrialized nations create enough food to feed over 120 other people. Your guaranteed baseline 30-40% employment has now fallen to like 1 to 3%.
When you extrapolate this into all fields of the economy this becomes a massive problem, especially as farming hasn’t had as much gains in worker production capacity increase as many of the good middle class jobs over the same period of time thus making the number of individuals necessary in these jobs even more reduced. As a result corporations can cover their capacity with fewer individuals and lay off the rest. When this happens it means there are now fewer people with money to buy things and this shock cycles back and trickles upwards in the economy. Industries in turn now need to produce less and yet worker productivity is improving, so people get fired even faster. On the next turn of the death spiral there is even less money in the systems and workers are even more productive, more firing, and so on and so forth until society collapses.
In the US currently there are about 5 people chasing every single job opening. This basically means no matter how productive, qualified or hard working these people can or want to be 4/5ths of them must simply be unemployed. As time progresses and worker productivity increases farther while companies continue to layoff to deal with decreased demand (due indirectly to previous layoffs) these ratios will only get worse and will do so ever faster with each turn of the death spiral. Social and economic collapse is inevitable on such a track. Back in the Dickensian era, when the grumpy wealthy man responded to poor beggars with “Are there no work house?” he arguably had a good point. Today the only sane response to that is “If only there were!”
Now add indefinite unemployment benefits. As an immediate direct effect the death spiral inherently slows (and significantly so) because the laid off people who can’t get jobs because they don’t exist still have enough money to spend to keep the private sectors cogs turning in spite of its on-going best efforts to destroy itself. In eras when there were more jobs then people, it is true that such benefits could provide disincentive for people to work, but when there are no jobs this doesn’t really change anything. Moreover recent analysis has suggested that unemployment benefits, so long as they are not too cushy, actually increases overall economic efficiency (no matter how long they are given out) see here: http://www.nobelprize.org/nobel_prizes/economics/laureates/2010/illpres.html
Now consider this: corporations in the US already can deduct payroll (I believe it is 100%) from their taxes. If corporate taxes are raised (slightly) to cover modest and not too cushy unlimited unemployment benefits then corporations actually end up saving money by employing people. This actually incentivizes corporations to create jobs, moreover, create jobs with at least slightly better benefits then the unemployment benefits. Now there are jobs and they offer better conditions then unemployment benefits. Furthermore studies have shown that people are naturally happier and prefer to be employed with all other things being equal. Assuming maximizing self-interest (you are an Austrian economist so unless you are going to renounce your religion here and now in front of everyone then you must agree to this assumption) people will seek to leave behind their unemployment benefits for the better conditions and the innate happiness tied in with being employed. Now the spiral runs in reverse and society has a chance of being saved (so long as it isn’t destroyed by something else like the financial sector or other forms of corruption and graft either public or private).
“But wait” you say, “you just said there were no jobs! How do companies just create jobs when there are no jobs! This is inconsistent!” No, actually it isn’t because that wasn’t what was happening. Companies only maintain as many jobs as they need to maintain their bottom line. Without interference via correct incentivization (such as by enduring unemployment benefits which corporations have to pay for directly or indirectly through taxation.) companies will create a death spiral of ever decreasing jobs and accelerating job destruction. But with the right incentives they can create an ever-increasing supply of jobs.
“But what would these jobs be?!?! Your model assumes everyone already has all the services and products they either need, want, or can afford, and thus won’t need more. Coupling that with ever increasing worker productivity there is still an innate ever shrinking need for workers to cover the demands of goods and services in society. Where are the new jobs without increased demand?” Answer = research, development, think-tank, and efficiency modification jobs in all their forms. This includes traditional lab research and development, as well as bureaucratic research to look for better marketing targets, costumer service response, and think-tank work for new business paradigms and efficiency. I.e. companies start to create a ton of these really great middle and upper-middle class type jobs for college graduates, like the vast number of unemployed ones part of the Occupy movement, that our current economy has started to severely lack and are the backbone to the American dream. In spite of the stereotype that halls of pencil pushing bureaucrats are a waste and drain on society, studies generally show that these jobs actually vastly improve overall economic efficiency, and, when not part of the problem, actually help to eliminate graft and such.
Furthermore there is no limit to the potential glut for these research and related jobs. No matter how much worker efficiency improves there is always an unlimited amount of potential research and development that can be done. More importantly these types of jobs themselves create a feedback loop for demand. I do traditional research as my job, and I can tell you first hand we create a limitless glut for consumption. The more money we get, the faster and more efficiently we can tackle problems of fixed complexity or move on to larger more complex and important problems. All our consumption creates a massive amount of demand for other forms of labor as well. Even when we order chemical reagents or quasi-exotic biological vectors and such from foreign countries, they get shipped from local branches of these trans-national corporations thus creating the need for more local employment to maintain and use infrastructure to deliver these goods as well as at the local factories and facilities that we are obtaining these products from. Even the pencil pushing bureaucrats create local demand for other jobs because even though they don’t have a fraction as high material demand and consumption as lab-work type research in their basic job, they go out and spend their upper-middle class pay-checks on all sorts of goods and services creating upwards pressure on employment and the overall health of the economy.
Thus, in conclusion, in these times, things like unlimited unemployment benefits (so long as they are not too cushy) actually reduces the “unnatural perversion” that is people not working, and as an added bonus can actually save capitalism from itself.
Unemployment insurance doesn’t exist because people choose not to work. It exists because government deliberately destroys jobs in order to improve the lot of our aristocracy.
If you believe humans should work, you should kill nearly every rich person in this country because they sure as hell aren’t working.
Don’t try to pass off contempt for poor people as high-minded principle. If you want to hate on a group, you can do that (and be treated accordingly). Pretending that’s somehow a matter of values is a blatant lie.
Of course, once people apply principles to the situation, the aristocracy ends up looking the worst. Our wealthiest steal the most, do the most criminal damage, pay the smallest price for it, and get the most welfare of all other groups in the U.S. combinded. If you aren’t an authoritarian, concluding that this class is a cancer isn’t a problem: you call ’em like you see ’em. If you are an authoritarian, however, you have a serious problem since you can’t very well kiss the ass of a group whose destruction you’re also advocating. This is the problem with creating a broad-based political movement: you have to first purge yourself of authoritarians, and most people don’t even think they’re a problem.
Unemployment isn’t a bug, it’s a feature, a deliberate result of antidemocratic policies. It’s the symptom of a deliberate disease, so you cure the disease.
Punish aristocrats under existing laws when they transgress, ignore and dismiss illegal pro-investor treaties, and recover money stolen during our financial crisis(es) instead of stealing the recovery from taxpayers, and, voila, you’ll flood the working people with cash (their own), increasing purchases, increasing job growth.
We wouldn’t need to discuss how to cure the plague if we simply closed up all the open sewers.
Sekhmet: It’s not clear that government destroys jobs. The basic economic theory goes back to the days when gold was the only real currency (paper got its value from the gold that backed it). The government could not spend an ounce of gold unless it taxed that ounce of gold from someone. But, assuming one can come up with a single ‘average’ percentage of increased income that every family will spend, the math shows that, if the government taxes away gold and then spends the gold, it must increase the total size of the economy.
But in real life (unlike economics) every family is different. Some will spend 100% of any extra money, some will spend little or none of any extra money. In which case, the math says that, if you tax people who won’t spend and then give the money to people who will spend, the government policy will create lots of jobs; however, if you cut taxes on people who won’t spend the money and take the money from people who would have spent all of it, that government policy must destroy jobs. It’s all introductory economic math.
Someone: Analysts explained the Great Depression (’29 – ’41) as being caused by increased productivity. Only the upper middle classes could afford toys like cars, and fewer and fewer workers were needed to make them, so 20% – 25% of the labour force were made redundant. Many (e.g., Russell Baker’s uncles) never worked again. Then came WWII. First, the US opened defense plants to sell to the Allies, and unemployment fell. Then the great economist Tojo introduced a make-work project that put more than 100% of the US labour force to work (many who did not want to be in the labour force were forced to work to support Tojo’s economic plan, and those unwilling labourers made the real unemployment rate negative, though the nominal rate was about 1.8%). Those put to work under Tojo’s plan could not spend very much of their wages (all purchases needed a ration card), so no inflation. Then, beginning in ’45, families could spend their savings, so they bought houses and went to university, and that demand created enough jobs to keep everyone employed until ’73.
Better than extended unemployment: intelligent infrastructure jobs. But a great example is Chesapeake Bay Candles, originally made in China, but US unemployment and shipping costs made them try to open a plant in Maryland, of all places. The local authorities demanded $1 million in baksheesh for a license, then, after getting the first million, demanded a second million. It took about four years, but they finally opened a candle factory in Maryland. So ‘regulation’ does prevent businesses from opening in the US, but it’s local regulation, and the national government has nothing to do with it.
And the answer it????