Keith Devens .com

Keith, I will agree with you that it is certainly not the President's responsibility to create jobs. No one is asking President Bush to go around asking firms to start giving desperate college graduates (like me) or out of work computer programmers. It's when he begins promising exorbitant amounts of jobs based on policies that he and his administration are developing is when he begins assuming some responsibility for putting their money with their collective mouths are. Of course he can't be held solely responsible for the incredible loss of jobs (we can thank Bangalore and Hyderabad for a large percentage of that) but I'm becoming tired of Bush promises and not seeing Bush results.

Of course he can't be held solely responsible for the incredible loss of jobs (we can thank Bangalore and Hyderabad for a large percentage of that)

You forget the recession (which Bush inherited), some of the largest corporate scandals in history which put large companies (Enron, Worldcom) out of business, 9/11 and its enormous effect on the economy, etc.

It's when he begins promising exorbitant amounts of jobs based on policies that he and his administration are developing

Ken, have you ever studied economics (I'm asking seriously)? Bush's "promises" do nothing more than assert one of the most basic principles of macro-economics, that taxes are a drain on the economy, and that tax-relief, which puts money back into the private sector, spurs economic growth which then leads to the creation of new jobs.

By the way, do you support Kerry? What's his plan to "create jobs"?

Keith,

I was merely pointing out that Bush must take responsibility for what promises to the American people. It doesn't take an economic expert to see that his tax cuts, which have been in place throughout his administration, are obviously not creating even a tenth of the jobs he has predicted for the entire year.

Via jobwatch ... "All told, the Bush Administration projected growth of 5.5 million jobs by the end of 2004 if its tax cuts were adopted, or an average growth rate of 306,000 jobs a month from July 2003 to December 2004."

However...

"The February 2004 job gain of 21,000 is a significant 285,000 jobs below the projected monthly increase."

I'll admit I have not studied any economics but I can do the math and the fact the Bush economy created 21,000 out of 306,000 projected jobs last month, which is 6.8% of what was projected, is more convincing to me that some economic "theory", aka Bush tax cuts, that is supposed to remedy at least some of this.

I realize Bush is a politician and they all make ridiculous promises. Hell, Kerry's promise to enforce corporations to go through a three month procedure before outsouring any work seems pretty incredulous. Still, and you'll probably find this naive, I support Kerry because he is the other option than President Bush.

Get ready for some rambling!

Arguably, there's many schools of macroeconomics, and not all of them would agree with your assertion that one of the basic principles of macroeconomics is that taxes are a drain on the economy. It's only the monetarism school that states that.

Mind you, they usually are, and that's only because most taxes break the fundamental properties of what a good tax should be like, namely:

* Taxation should bear as lightly as possible on production.
* It should be easy and cheap to collect, and fall directly on the ultimate payer.
* It should be certain.
* It should bear equally, so as to give no individual an advantage.

A certain level of taxation is unavoidable because, and this applies to any society, the activities of government, and government is unavoidable, must be funded.

Most taxes don't fulfill those properties because that means narrow taxation (a small number of taxes bringing in large amounts) rather than broad taxation (a large number of taxes each bringing in small amounts). Broad taxes allow politicians to play special interests off one another. Narrow taxation, despite their advantages (and, if I have time, I'll outline them sometime), don't. Broad taxes, because of their complexity, introduce loopholes, and these can be exploited.

Government is all about infrastructure. Government gets involved in things that aren't directly profitable in part to create the conditions to allow its citizens to flourish. As a small example, consider the US Highway System. No private company would have ever considered building such a thing, but there's no doubt that as it was completed, it helped US business immensely. It's effect on the economy was indirect, but real. In this country, I could name the ESB, the state electricity company here, (which, despite the bad reputation of semi-state companies, is considered one of the best run companies in Europe, is quite profitable, and its power is dirt cheap), the group water schemes, the ACC and ICC (two state banks set up in the 60s to provide credit to industy. It worked), and a host of others.

There's also the idea of the state as the employer of last resort, as an alternative to the dole; an idea that's worked successfully in the past where it's been applied. You only need to look at the Great Depression in the US for a practical example. The idea isn't so much a job for everybody, but to inject liquidity into the market again. The same argument is often made for depreciating currencies.

A great fallacy of much thinking about government is that it's a black hole. However, that plainly isn't true. Government redistributes money. It's not profit making. Taxes gathered go to paying for infrastructure (boosting the private sector), government contracts (back into the private sector), to the poor in the form of social welfare (classical redistribution).

There's a good reason why both Kerry and Bush tell people that they're going to create jobs when they get elected: they're telling people something they want to hear. Having a job improves your self esteem, and the prospect of electing somebody to office who'll give you that chance makes you more liable to vote for that person. This isn't anything to do with economics. It doesn't matter whether in reality they'd be able to, it's all psychology.

BTW, didn't you used to have a preview button?

BTW, didn't you used to have a preview button?

Yeah, I used to before I switched to my CMS. I'll have one again someday.

By the way, one of the things I forgot to mention in my above post besides the recession, etc., is the dot-com bust! It annoys me that I left it out because it's so relevant to this issue. During the boom, the unemployment rate was artificially low, and the market has since shed jobs. However, the unemployment rate now is actually low historically. I've seen articles written during the Clinton years talking about the low unemployment rate during a time when the unemployment rate was pretty much the same as it is now (IIRC, just about the same point in Clinton's first term as it is in Bush's), while for Bush the unemployment rate is considered high. It seems like a double-standard to me.

Keith, you don't support a flat tax, do you? Anyway, to paint with a broad brush, I don't disagree with much that you said, and agree with much of it. However, a few points: Government beaurocracy isn't subject to market pressures, and will therefore generally be much more inefficient than the private sector. In other words, money will be spent much better in the private sector than in the hands of government beaurocrats, not to mention that businesses will spend money on things they need (also subject to market pressures), while government often wastes (or just plain loses money) on pork or otherwise. Other point: Ireland is much smaller than the U.S., and things which might work on a small scale don't necessarily work on a much larger scale.

Yes, I favour flat taxes, but not within the kind of taxation regime commonly used here in the west. I also favour making it unprofitable to hoard capital (the analogy of capital as the economy's equivalent of blood), and I don't like landlordism.

I also favour the idea of a country being a confederation of small, interdependant communities working towards a common good. Regardless of the size of a nation, it's these communities that should be doing the work. The best example of this in the real world is Switzerland. (You know, I got modded as a troll once in ./ for pointing out that it's one of the few proper classical democracies in the world, and that other so-called democracies are republics.) I think I read about some movement over in Canada that's looking to having it refederated along the lines of the land of cheese and clocks.

It doesn't matter if you're talking about countries the size of Ireland or the US. It's states, municipalities, counties, other smaller units, that should be doing the things I'm talking about. Part of the reason federal government is so powerful in the US is that people cede the power because it entails responsibility. People are lazy and for all their talk of rights, they forget the responsibilities they bring with them.

I don't disagree that government bureaucracy is inefficient, but there are areas that private enterprise won't touch, things that aren't immediately profitable, but will show profits in the long term, especially for the broader community. It's here that semi-states can be useful.

Mind you, if a semi-state company is working efficiently, I see no reason to privatise it. I've a friend who's right-wing like you and we got into a discussion about the ESB. His argument was that it should be privatised solely on the grounds that government has no business in, um, business. Mine was that it's working fine, and it's not broken, so why fix it.

Bush is getting heat because US firms don't like hiring, and his attempts at job creation don't appear to pay off. Clinton, on the other hand, was lauded because they did. It's all a matter of appearance moreso than double-standards.

I'm off. I'm exhausted and I've my year project to have finished by the start of next week.

You sound much more conservative than I thought you'd be. You even seem to have a lot of the same ideas about federalism that I do. Namely, that the functions of government should be done at the lowest level possible.

I also favour making it unprofitable to hoard capital

I'd be interested to hear what ideas you have along those lines. The only thing I could imagine that would do that would be to have inflation and somehow have no interest. Or, to simply tax people for their held assets, which seems wrong.

Last question... do you support socialized/nationalized health care?

I'm neither left nor right wing. I prefer to think of my own politics as being out ahead. Most supposedly left-wing people tend to agree with me when I express the opinions I outlined above. I started formalising things and posted some articles up on my blog, but then I remembered my wiki, so I'm going to start building it all up there.

My attitude towards government stems from the good old principle of subsidiarity. The same goes for private enterprise. I don't think that large companies are necessarily a good thing. I also don't think that it's a good idea to have a division between shareholders and employees: I like the idea of commonwealths, co-operatives, and mutual societies.

Not much time to talk, but one idea that works well but isn't liked by banking institutions is that of depreciating currencies.

Health care's a hard one I would lean towards socialisation of healthcare, but it's not quite that simple either. Must tackle that some time.

This, by the way, is clever.

You should dig out a copy of EF Schumacher's book Small is Beautiful.

Saw the job stats today from CNN Money. Not bad. 306,000 new jobs is right in the monthly ball park that the Bush administration. I'm not sayin I'm still convinced that his predictions will totally hold true but maybe I jumped the gun...:: removing foot from mouth ::

Regardless of the fact that this is good news for the Bush administration, it is good news for all Americans. More jobs means less chance I'll be living at home for a year (shudder).

Though economists cautioned that one month does not a trend make, it was possibly the best economic news since the onset of the last recession in 2001,

Let's hope it continues.

http://biz.yahoo.com/cbsm-top/040806/8c3c3f7014d365162db64f682d0b3194_1.html

"The Labor Department reported that the U.S. economy added 32,000 nonfarm payroll jobs in July, nowhere near the 235,000 jobs economists had expected would be added. Payroll growth in May and June was revised lower by a cumulative 61,000, as well."

I read a great article in the Sunday Times a few weeks ago comparing the policies of Bush vs what Kerry promises. Both are almost neck-and-neck but Bush came out tops by a small margin. I'll see if I can dig it up from their website. Interesting analysis of the lies, exagerations, and context both parties put on "facts".

Sure, if you can find it, send a link on over.

ideoplastos, you specifically chose to snip out where the article says that the unemployment rate fell from 5.6 to 5.5 percent.

In addition, there's a lot more data about the economy than simple payroll jobs numbers. As the economy moves increasingly to self-employed, freelance, and contract workers, the payroll numbers become less and less relevant. For example, according to the household survey, the Beareau of Labor Statistics states that total employment increased by 629,000 jobs in July! You also chose to not mention that consumer confidence is way up.

Of course, no individual number tells the whole story. In fact, there's even a large fudge factor in the numbers (scroll down to the post at 8:24am). Individual months really don't matter very much. What matters is trends, and our economy is in a period of sustained growth and rising consumer confidence. What's also important is what's going on in the economy that explains the numbers we see. Large spikes in oil prices may have helped lead to the smaller monthly jobs numbers, and Jayson at PoliPundit argues that the explanation for some of the other numbers we see is that "companies binged on W-2 workers in the Spring and early-Summer". He gives some more detail if you'd like to follow the link.

(Here's where I got some of the above links from)

ideoplastos, you specifically chose to snip out where the article says that the unemployment rate fell from 5.6 to 5.5 percent.

Yup.

In addition, there's a lot more data about the economy than simple payroll jobs numbers. As the economy moves increasingly to self-employed, freelance, and contract workers, the payroll numbers become less and less relevant. For example, according to the household survey, the Beareau of Labor Statistics states that total employment increased by 629,000 jobs in July! You also chose to not mention that consumer confidence is way up.

Yup.

Of course, no individual number tells the whole story. In fact, there's even a large fudge factor in the numbers (scroll down to the post at 8:24am). Individual months really don't matter very much. What matters is trends, and our economy is in a period of sustained growth and rising consumer confidence. What's also important is what's going on in the economy that explains the numbers we see. Large spikes in oil prices may have helped lead to the smaller monthly jobs numbers, and Jayson at PoliPundit argues that the explanation for some of the other numbers we see is that "companies binged on W-2 workers in the Spring and early-Summer". He gives some more detail if you'd like to follow the link.

Yup.

(Here's where I got some of the above links from)

Thanks.

http://www.weeklystandard.com/Content/Public/Articles/000/000/004/453ttpaz.asp

Pretty good article. Thanks.