What to do about Unemployment?

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'Tis that time in the quadrenniel cycle once again. Even Mitt Romney says "Jobs!" emphatically while campaigning.

Right now, unemployment is around 10 percent in the USA. If businesses produced more crap, then they would hire more people. As I see it: our country already has all of the crap we need. If businesses were to produce more crap, it would reduce unemployment, but for no valid purpose.

Lowering the minimum wage might cause firms to hire more people, but at the cost of increased inequality, which is getting more and more acute as time goes by.

Lowering the retirement age would help to remove people from the labour force, and help wages to rise, as businesses competed against each other for the remaining workers. This would also help to reduce inequality.

The Negative Income Tax was first proposed by Conservative economist Milton Friedman. If every American citizen were guaranteed a base income of, say, $50,000 per year, then a fair number of people would probably opt out of the labour market, and raise wages among those who opt to remain in the labour market.

What say ye?

Extensive infrastructure projects could take up some of the slack. During the Great Depression there was the building of Boulder Dam (now Hoover Dam), the civilian conservation corps, construction of the IND subway in New York City, the Tennessee Valley Dam and such like projects.

ruveyn

Put a tax on not hiring people.

Megaprojects such as a two kilometer tall statue of a frowning Jesus in San Fransisco bay, to help free the gays from their unholy servitude,

That will drive many businesses into bankruptcy. The above is a counterproductive proposal.

Besides, who is to decide how many people a business should hire? The government? The government is operated by incompetent folk who could not run a business at a profit, unless that could compel people to do business with them by force or threat of force

ruveyn

If they are not good at giving employment, then why exactly should we care they go bankrupt or not? It is survival of the fittest.

I recommend reforming the tax code. Interest earned should not be taxable income, plus I recommend allowing a deduction for putting money in a CD. This will increase the savings rate, encourage capital production and raise the marginal product of labour. Thus causing the demand for labour to increase leading to a fall in unemployment.

Monetary easing won't really do that much, especially in a liquidity trap, and the long term effects of such easing is usually not that positive, as it usually leads to speculative bubbles. Like the housing bubble that caused the problem in the first place.

Between 2001 and 2008, there was a 89% positive correlation between the monetary base and median home prices.

The only way we can eradicate unemployment is to implement a different, sustainable socioeconomic system. We will always have significant unemployment otherwise, because it is in the interests of the establishment class to keep it that way. It has the effect of driving down the price of labour because without significant employment choices people are forced to compete and accept whatever awful pay and/or work conditions are thrown their way. This is benefiting nobody but the employers, especially the larger ones who specialise in churning out higher proportions of unskilled work.

The UK conservative party's workfare scheme is completely counterintuitive to a solution that will reduce unemployment as well as increase the average standard of living.

The government is worse. When it employs people, very little is invented or produced. Government is essentially a wastrel.

ruveyn

The private sector isn't really pulling its fair share if we are being honest. I can't speak for the United States but here in the british isles we are witnessing a core of industrial activity gravitating towards non-productive areas, mainly in the financial and administrative fields of bureaucracy and pen pushing. Insurance, lending, debt collection etc. The 'parasitic industries' which they have been truthfully called. The private sector is good at doing what it aims to do; to create wealth for itself. The rest of us are really an afterthought at best. At least you can vote politicians out.

This country once had a proud history of manufacturing and exports. The Titanic was built 14 miles to my immediate west. The delorean car that appeared in the back to the future series was also manufactured here. All of that is dissapearing and its getting worse as we're seeing a standardisation of de-skilling and more of our indigenous talent is fleeing abroad to find better paid and more glamourous purpose. All this is down to the fact that the private sector is getting a bigger portion of power. The invisible hand of the market is failing the most vulnerable. Here it used to be possible for youngsters to get work placements with a lucrative future, in shipbuilding and aerospace. These are closing down and instead we're seeing supermarkets and call centres. Places with low pay and low opportunity for self growth.

We will never see a solution unless we're able to get through the private vs public paradigm. They are mutually incompetent and mutually indifferent to our collective embetterment. The answer lies between the middle, in us, the people.

Ending the wars and Foreign Aid is one of the few things I think could help. That includes the drug war and paying for all those bases around the world.

Use that money domestically for productive things like infrastructure, but especially find ways to create innovation by working with the private secter.

Some people consider war time a strong booster to the economy but I have doubts about that.

The largest class of businesses providing employment are small and medium size firms. In the U.S. these firms make real things and provide real services. Do not confuse this class of business people with the highly subsidized crony capitalists.

Calvin Coolidge once said, the business of America is business. That is why we grow enough to feed the world and much new technology is invented and produced in the United States. Do not confuse the quasi fascitoids of Europe with American business firms, especially the small and medium sized firms.

ruveyn

well that isnt just crony government subsidization though, that can also be a symptom of a corporation with the power to do what it wants.

i will agree that small and medium buisnesses dont fall into this category(usually, there are some bad apples,)
but that still does nothing to the actual issue at hands, piranha capitalism.

De Beers diamond dynasty is one such example.

Reduce workhours per week.

To an extent, I agree with you. There is a driving force in 'middle business' of creativity and better industrial relations because while they are forced to give their employees better rights for fear of losing them, they have higher spending power to invest than smaller businesses and tend to be locally centred so have a higher sense of duty to its employees than multinationals would. One of the reasons the German economy went from strength to strength is the drive of middle business or the 'mittelstand' as they are known there. Maybe our countries should take a leaf out of the German book.

Problem is though, what do you do when a middle business becomes a big business? New companies aren't just starting organically like laissez-faire advocates would have us believe. The imperical evidence is proving the contrary. This is down to economic conditions and the gravitation of wealth towards big business, not government legislation.

What you don't want is a situation where large businesses have a monopoly over the job market. This has the effect of driving down both working conditions and wages. For example a large town where everythings went under and the only thing left is a McDonald's, a call centre and a bunch of supermarkets. Thats pretty much the situation we have where I live. Everything can't be left to the private sector. While the private sector is good at making wealth, it is bad at distributing it in a utilitarian way. An electable authority ensures that wealth actually gets to the people that need it, if we have a fair and proportional democracy that works. While I agree that the state isn't flawless, where I disagree is that the state is bad in principle. We just need better people running it. The private and public sector need each other mutually.

There was a time when people looked down on government work and government workers. Low pay, unchallenging and unstimulating work, but a certain level of stability.

Nowadays, one is lucky just to have a government job. While pay and benefits have eroded in the private sector, government jobs have become rather plum in comparison. Especially when you consider that few employers provide pensions these days, let alone health benefits for retirees.

And, Mitt Romney wants to bring the pay and benefits of government employees down to the levels presently suffered by private-sector employees, rather than trying to improve the lot of private-sector employees. Class warfare at its finest. Make the people envious of government employees, and seek to bring them down. Ah well, kicking government employees around always plays well with the great mass of voters. Even though it is now mostly contractors who are suckling at the federal teat. But, the contractors have boatloads of money to contribute to Repugnican campaigns, so no complaints there.