The man who is slated to save the economy as being the head of the jobs commission (CEA) with President Obama:
Photo from: http://swampland.time.com/2011/08/29/alan-krueger-obamas-new-top-economist/
Will he be able to save the country and still keep the president’s motivations and political ambitions as he wants him? Or the better question I tend to seriously think that applies: Does any president ever believe they can actually “Create” more jobs than they destroy? Whether you increase defense spending or stimulus spending, you end up in every case destroying more jobs than you could ever hope to create due to the fact that Government is ALWAYS going to be less efficient than private enterprise.
But first, the president has some harsh wake-up calls to respond to at some point. There are currently 174,000 people employed DIRECTLY by coal in the US currently. Indirect employment probably approaches approximately 500,000 jobs which are funded through coal jobs in this country. Indeed, this is relevant because the president in this address:
http://www.youtube.com/watch?v=4aTf5gjvNvo&NR=1
Shows how his economic policy (as stated then) and which today he enforces through the EPA by “writ” to enforce since congress refused to pass it due to “re-election” concerns among democrats. So bankrupting the coal industry will cost the US approximately 500,000 jobs right off the bat. The EPA has started this process with over 50 power plants slated to shut down next year due to “new regulations in regard to CO2.” Read that as additional costs through taxes, fines, permitting fees and other money going straight to the Government for the same kind of people. A milking if you will of large corporations in this country.
But this will continue until as I showed the president bankrupts any coal company and they either move out of the country or just stop doing business here. This does not help the US, but perhaps there is a way to save those jobs during this recession no less which will make it possible for our country to not go into an even worse recession.
Will this economics “master” be able to save more than 500,000 jobs? The possibility is there if you believe in unicorns and how their “farts” will save this planet. Or perhaps you believe in magic. Disney can probably help out with that if you do not, but alas facts do not support any of the policies of our current president in regard to economics and the truth is that he has cost our country more jobs than he could ever hope to create. And that is prior to him “working to dismantle the coal industry. As a note, any president who “Creates” Government jobs is actually destroying more jobs than they create.
In any regard: here are some possible solution I am sure this “master” of economics will come up with:
They could possibly create green jobs out of those 500,000 unemployed. The only issue is that for every green job created, you lose 2.2 jobs.
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a2PHwqAs7BS0
So, the magician act does not actually work, and since the president wants to “model” the country after Spain, his technique would be very similar to that country. That means, that people would simply take advantage and produce “solar” energy from “solar” collectors at night which is a common problem in Spain right now with individuals buying diesel generators and running them 24/7 for a huge profit. That would mean that yes, for every green job he created, 2.2 jobs would be lost. That is a negative figure, so green jobs is definitely not the answer. It literally sucks the life-blood out of a society, so that would just make the recession worse as a possible solution.
Maybe an alternative is another stimulus. We are after all only in debt by 15 trillion approximately so perhaps the solution is to “create money out of nothing” and perform QE once again. I posted about this previously, and this solution does not seem to work, and congress is probably unwilling to pass a deficit increasing measure which in all likelihood would cost the country more jobs than it would create anyway. So you can not create jobs with “fake money you create” or through “other people’s money that you borrow.”
My previous post about QE:
Another possibility is raising the tax taken in without raising taxes. This could be done by raising the retirement age and raising the requirement of SS up to say 70 years of age. (Which is going to be done at some point anyway..since the system will bankrupt the country otherwise.) But this creates a new problem as I have mentioned in another post about how the Government can never create jobs as efficiently as the private sector. So this solution would just result in higher unemployment when the unemployment rate is already high. As in the green job example, more jobs are lost for every Government job that is created, so as a whole Government is just a drain on society.
As always, there is no solution that the president can put forward that will actually help create jobs. The process is natural and will happen of its own accord. He could possibly speed up that process, but that would involve him giving up his precious beliefs on such things as “evil coal” and “evil gas”.
By literally destroying those job sectors as he is slowly doing today, he is the number one cause of job loss in the country out of anything. The only thing he could do is ease regulation, permitting costs, and ease fining. He could do this tomorrow by directing the EPA to stop frivolous rules that do not help in any meaningful way to lower pollution but just serve to pay rent-seekers at the expense of large corporations. Just like any other vampire, if you suck too much from something, it will die or move away.
So what is the solution? Is there a solution? Perhaps the plan coming out will not be one of the mentioned possibilities and will actually work to create jobs? That does not work like I mentioned, and unless the president compromises on his beliefs and dismantles the EPA first, the entire question of him reducing unemployment and thusly of actually getting re-elected are both very slim to none.
As a note, the research that Brought Krueger to fame is listed here:
http://emlab.berkeley.edu/~card/papers/njmin-aer.pdf
It’s interesting that the conclusion that raising the minimum wage has no consequence is actually claimed considering the study is so limited being applied to just fast food which is as a rule run by large corporations who tend to be able to take losses over a longer time period.
So basically, he is one of those economists which bases conclusions on very small snapshots of a picture.
Nothing different then our current president therefore, and as a result we shall see some of the same old tired and unworkable ideas pushed. No jobs will be created, but they will claim job creation. Should be interesting in any regard what brain-dead (or zombie) plan we see.
I personally am thinking its going to involve QE. That is the only way you can create money out of thin air and since the two men are both just as deluded in their thinking, it will be obviously some magical process which might have real consequences, but they just refuse to look at the bad and claim that anything bad that happens is someone else’s fault and any good that might happen is because they are good people. Another delusional duo sent to save the country once again. Make sure to have those unicorn farts ready to power our country while you are at it. Going to need them for when the wind does not blow.
The magical plan will be discussed here when its released and ready.
BenfromMO 