It seems pretty obvious to me that when your policies seem to be deliberately aimed at discouraging hiring in the private sector, this is what you’re going to get.
13 thoughts on “A Scary Unemployment Graph”
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It seems pretty obvious to me that when your policies seem to be deliberately aimed at discouraging hiring in the private sector, this is what you’re going to get.
Comments are closed.
Unemployment should be a personal account that is skimmed tax-free directly off of income until it reaches some reasonable level. Take the current employer’s per capita ‘unemployment insurance’ and add it to the stream entering this account.
Then you can draw out of the account as long as there are funds… but you know you’ll be putting money back in once you do have a new job. If you decide “I’m taking a sabbatical to do xyz”, no one will much care – it’s your money.
I understand your argument Al, but that was essentially the story that was used to sell Social Security. But as Social Security doesn’t have individual accounts with “lock boxes”, it is certain that the money put away will be spent by someone else.
Then again, there is a reason lock boxes don’t exist and would never work. Money that totally sits idle doesn’t grow. I put money into a 401K, but it is invested into companies who then use that money (in my case mostly wisely, but sometimes unwisely). If those companies don’t grow with the help of my money, then my account neither stays idle or grows; it shrinks. However, the key is that I get to pick the companies/investments, not Congress.
If it’s called insurance, it aught to be insurance. Let private companies compete on terms in an open market. Premiums paid by employees result in a lump sum payout on unemployment.
The market will determine which companies (and their terms) stay in business. If the unemployed can make their payment last 99 rather than 26 weeks… more power to them.
The government needs to get out of all financial issues other than very specific and limited cases. Unemployment insurance creates a lot of government jobs that need not exist.
Leland, I’m thinking much more along the lines of a 401k arrangement for “the account.” I agree completely that the current Social Security “lockbox” is a joke.
The deal is: It’s your money, it’s just pre-tax. It’s fundamentally self-insuring against unemployment.
Looking at these charts just makes me that more convinced that soon we will start seeing everyone across the spectrum proposing more protectionist measures.
This unemployment trend was inevitable. It is due to a nexus of converging trends. Manufacturing was out sourced to China, while services are being slimmed down by increased IT automation. Add to that high raw material prices and it is a recipe for disaster.
The economy needs to be overhauled with new, lower cost, products everywhere from agriculture, to manufacturing, or services to feed a new rising worldwide middle class. Transition to new modes of production will provide the required employment.
The transportation sector needs to be deeply electrified (mass transit and personal vehicles), the electric grid needs to be upgraded, alternative energy sources funded. High speed wireless, net neutral, data access to allow people to work anywhere, anytime. We also could use cheaper raw material extraction, separation, or replacement by other more available materials.
Education needs to be rethought. In an age where everyone has high speed internet access, does it still make sense to force people to travel to school every day? Why not going back to home schooling, while making people go to the school only for exams? Why aren’t school books made available in easily modifiable electronic form?
Space development should be encouraged. If we ever managed to make space access cheap material supply issues would be essentially solved. One reason why hydrogen fuel cells are not economic, for example, is the high cost of platinum. If platinum was cheap that issue would be taken care of. Even if hydrogen fuel cells never make sense, the cheaper platinum could be used for catalysts.
Leland, I’m thinking much more along the lines of a 401k arrangement for “the account.” I agree completely that the current Social Security “lockbox” is a joke
How about making it part of the 401k arrangement?
If they aren’t at least nominally separated somehow, I would think you would end up with lots of troublesome corner cases that would require reams of regulations to catch weasels.
But if you’re just talking about lumping them together under one investment manager – while tracking exactly how much is unemployment versus retirement – then that’s fine.
(Although I’d personally put every single entitlement in the same framework. )
This unemployment trend was inevitable. It is due to a nexus of converging trends. Manufacturing was out sourced to China, while services are being slimmed down by increased IT automation. Add to that high raw material prices and it is a recipe for disaster.
You neglect growing disincentives to hire people.
The economy needs to be overhauled with new, lower cost, products everywhere from agriculture, to manufacturing, or services to feed a new rising worldwide middle class. Transition to new modes of production will provide the required employment.
You neglect growing disincentives to do this.
The transportation sector needs to be deeply electrified (mass transit and personal vehicles), the electric grid needs to be upgraded, alternative energy sources funded. High speed wireless, net neutral, data access to allow people to work anywhere, anytime. We also could use cheaper raw material extraction, separation, or replacement by other more available materials.
Ditto.
Education needs to be rethought. In an age where everyone has high speed internet access, does it still make sense to force people to travel to school every day? Why not going back to home schooling, while making people go to the school only for exams? Why aren’t school books made available in easily modifiable electronic form?
I have a different take. Does it seem worthwhile to subsidize unproductive approaches to education? My view is that the technology is far away from allowing telecommuting on a large scale. You really need a system advanced to the point where it is at least as good as being in the classroom.
Other unproductive uses of education funding is to subsidize unprepared and/or outclassed students in college. We have a vast education process going. But it just drives prices up for the people who get useful education.
Fundamentally, the problem is that we have an economic environment where there are considerable disincentives to solving the many problems and challenges you describe above.
The problem is third party involvement which guarantees inefficiency. The government being the third party.
We need just one regulation… caveat emptor.
Along with that we need a press that investigates and reports the truth. When they don’t, they need to be discredited right out of the business.
Manufacturing was out sourced to [anywhere]
That’s part of the solution, not part of the problem. More employment (in both countries) is the result of comparative advantage (pg. 438 of ‘Basic Economics’) I just learned this myself.
Many jobs have moved from America to overseas. One has to ask why. The biggest reason is that it was more profitable for companies to relocate their jobs overseas. Again, we must ask why. Cheaper labor costs is one part of the answer, but that lone seems insufficient to explain all of the moves. After all, it costs a lot of money to set up a new factory somewhere and it’d take a long time to recoup that investment on labor savings alone. So, what else could be a factor? How about the cost of compliance with the tens of thousands of new government regulations that get enacted every year by unelected and unaccountable bureaucrats? These regulations – some good and some not so good – all drive up the cost of doing business here in America. The regulations hit just about everything from environmental compliance to human resources.
When you subsidize something, you get more of it. Conversely, when you tax, penalize, and regulate something you get less of it. America has become a place that isn’t very business-friendly. Large corporations can afford the compliance costs that can be excessive for small businesses. Large corporations have been known to be in favor of laws that make it harder for smaller businesses to compete against them. It’s small businesses who are the driving force behind job creation. Things that make it harder for small businesses to survive and grow hurt all of us.
One of the reasons it is cost effective to move jobs out of this country is the cost of complying with environmental regulations here that do not exist there.
Perhaps this is the real space program. Make it so difficult to start businesses in this country that launch costs seem insignificant?
One of the reasons it is cost effective to move jobs out of this country is the cost of complying with environmental regulations here that do not exist there.
Yes, that’s pretty much in line with what’s been said here. I have no problem with some parts of the world competing on weaker environmental regulation as long as it doesn’t affect me. It’s a choice, just like someone could chose a safe fast food job or a risky construction job.