What to do about Unemployment?

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In about 50 years I would estimate.

ruveyn

I say the opposite.

The problem with this idea is that when a recession strikes it would reinforce it, as companies desperately try to cut costs by losing slack labour and get hit with a big bill, forcing them to shed more labour etc etc.

I say hike up the corporate tax rates and capital gains taxes etc across the board and then offer massive rebates in areas of high unemployment. This would need to be an automatic mechanism to reduce fraud etc and also the reduced rate would need to be guaranteed for several years to make it worthwhile to invest in an area.

DC -- during a recession or slowdown corporations would have an incentive to not layoff workers and perhaps prepare for better days. By not laying off workers recessions should be shallower and shorter.

I would agree, and it makes you wonder if it is the reactions of organizations (laying people off) that prolong and deepen recessions.

As long as business firms aim to be profitable they will attempt to keep revenues up and costs down.

ruveyn

Small businesses today plan for the next few months, large corporations a few years and recessions do not hit everyone equally.

Real world example, an engineering firm involved in the construction industry, in 2006 they employ 55 staff and are planning to expand, by 2010 they employ 6 people and are fighting to stave off bankruptcy.

How on earth would doubling the tax bill of this company mean that the company would still be employing 55 people despite the fact that their turnover is down by over 90%? How is the incentive supposed to work?


If you study Keynes you will learn to take a different view of recessions and the boom bust cycle. A recession or a bust doesn't happen out of the blue, it is the inevitable outcome from malinvestment during the boom years. Without a time machine their is nothing you can do to make that right.

After the global property boom we just had, their is nothing you can do to 'unspend' the money you spent pouring concrete and building houses that are now worth half of what it cost to build them.

After the dot com boom you can't unspend the 20 million dollars that you gave to a spotty 17 year old who spent it all on champagne, parties and marketing.

After the tulip boom their is nothing you can do about the fact that you just spent half a million dollars on a tulip bulb. You are now the proud owner of a tulip bulb, you owe the bank half a million dollars plus interest and you are in deep s**t.

etc etc

We can't prevent booms and busts, not even communism can do that (the soviet union ended up with plenty of warehouses filled to brimming with unwanted goods simply because that style of ladies stocking went out of fashion last year)

The answer to a recession is not to try and make sure you that you keep an army of tulip growers growing tulips after everybody realises the fact it is completely obvious that the tulip is worthless.

The answer to a recession is to create new growth elsewhere in the economy but the problem is that the economy doesn't care where geographically this growth happens but for employment it is very important that the areas hit hardest by the recession receive the greatest increase in new capital investment.

Your tax plan does nothing to change the fact that the tulip industry is screwed and the companies involved are going to go bust, it simply punishes the companies in different industries that aren't to blame for the recession but are already struggling because of the economic shock.

My tax plan doesn't care that malinvestment took place and doesn't try to stop the market adjusting as it must. What my plan does do however is ensure that the harder an area is hit by the recession, the more attractive it is to future investors, meaning faster recovery of jobs where they are needed.

I'm surprised that none of the Conservatives has yet mentioned the obvious Conservative solution:

Arrest--on charges of vagrancy--anyone who is unemployed , and put them to work on chain gangs.

People would thus have an extremely high incentive to find employment, which would drive down labour costs substantially.

Vote for the democrats. During Bill Clinton, unemployment was below 5% for 40 consecutive months.

which in turn means you will either have a very large very poor lower class with barely the basic ameneties(oh the american dream)
or you will have to down adjust the price of goods, this will bring further export but can lower ones international buying power dramatically, for a nation as reliant on import as the us that might be a problem.

For us, all that really matters is that people like Mitt Romney can become richer and richer.

It already is :/

English is still the most frequently used second language. But in due course Chinese will become a prominent language to reflect China's economic position in the world.

ruveyn

Arrant Pariah -- I guess we should all invest in chain gangs. Keep in mind poor people still need basics to survive which is demand. As one lowers demand one can begin a vicious downward cycle.

Why don't 'we' just kill them?

Civilisation is crueler than the wild because those who fail at life are expected to remain alive and bear the resulting humiliation not just for the term of their natural lives, but (in Europe atleast) for an unnaturally extended lifespan. In nature, none of these things are conceivable.

If this were to be enacted all at once, most of the people who were left over would start to panic about the consequences of losing their jobs, but human society as a whole should always have been like certain monkey societies - During adolescence, 50% of all males are slaughtered (torn limb from limb) by their peers due to the competition for forthcoming status in adulthood that characterises all life.

At the very least, there should be a painful and terrifying 'rite of passage' before boys can call themselves men; this would have spared me and many others a lot of f'ed-up-ness.

Last edited by undefineable on 24 Aug 2012, 5:51 pm, edited 1 time in total.

Another thing, ArrantPariah - because it makes them undeniably useful, slavery gives people too much self-esteem - Watch Schindler's List.

Our society has atleast grasped that the feeling of having a right to exist (which results from earning an average or above-average income from work) is a privilege and not a right. It just hasn't got round to removing existence from those who fail to earn that feeling. Those who suck more from the world than they contribute to it have a debt to it, and therefore can be said to lack the right to exist.

In case anyone's wondering, I believe that ideally all humanity should be wiped out by the richest 0.1%, along with anyone who has somehow managed to get that rich without having diagnosable Antisocial Personality Disorder.

The capacity to suffer emotionally (as well as physically) is a blight on Reality.

Glad I got all that out of my system

You never heard of Supply Side Economics?