SODOM & GOMORRAH: There’s too much at stake for us to continue the current jobs rhetoric.
We all sound like a bunch of old Soviets with our talk of jobs. Indeed, as Oleg Kalugin mentions in his biographical work “Spymaster” (he was a KGB general), as the Soviet Union grew closer to collapse, the political insistence on making sure Soviet citizens were working to the best of their abilities, putting more Soviets to work, and making sure people did their jobs became almost deafening. The leadership insisted that work could fix the country’s problems, and their rhetoric served to mask a deeper structural flaw.
It would be foolish to say that the American system is collapsing. Certainly many more steps are needed before we encounter true revolutionary insurrection, hyperinflation, or any of the other specters normally associated with collapse. However, we must admit that much is at stake in the current crisis.
First, we are breeding a generation of discontents. In modern societies, the youth have always held a certain dynamic potential that ideologies have been forced to acknowledge in one way or another. Machiavelli, like most modern thinkers after him, sought to harness the lack of rootedness young people have in order to promote new orders. The counter-revolutionaries have sought to check the dangerous nature of young people by placing them in institutions that instill a sense of ownership in society. Our young people lack that ownership. It’s doubtful that they have much loyalty to a system that has educated them for careers that don’t exist and then turns to them to foot the bill for corrupt policies. Should we continue to waste their potential, we will suffer.
Second, the middle class, which ostensibly has the most to lose in a period of change, is losing most of what it has. Home prices are collapsing, the job market is fluid and requires frequent relocation if anyone hopes to maintain employment for very long, and inflation is eroding their savings, which has always been the source of their stability and their ability to live comfortably.
We are, in a word, situated on the brink of a very explosive situation. The youth are even more rootless than they normally are; they lack all role models and corrective institutions. The middle class are losing their connection and stability to the current order. We need leadership to prevent disorder.
But what leadership do we have? We turn to those in “authority” for some explanation. Everyone’s answer is unanimous: if we just put Americans to work, everything will be fine.
The Democratic Party says that jobs are the answer. President Obama has given us several “jobs speeches” and plenty of “jobs plans” that have resulted in, as the Republicans will point out, no jobs. He promises us investment in green technology and infrastructure repair, two ideas that are absolutely ludicrous. John Rockefeller didn’t need a government grant to develop alternatives to kerosene. And repairing our roads to nowhere won’t fix the government’s problems. Both ideas are a joke: we need Uncle Sam’s guidance to figure out which energy source is best (while detracting resources from other industries and creating more inflation and debt in the process) and we need to spend several years repairing roads. The Romans could build roads from Italy to Greece in just a few months; it takes us years to make corrections to existing infrastructure. We call this making work for Americans…
The Republican Party response is almost worse. Mitt Romney criticized the president for being “too late” with his jobs plan, and then came out later to announce his job plan. Michele Bachmann asked President Obama to turn water into wine because the President of the United States is somehow out of line to ask Congress to gather their lazy selves in front of him on a particular evening. Nobody seems quite sure if jobs come from deregulation or protectionism (everyone conveniently forgets that a tariff is a tax, which I thought the Republican Party was against). Everyone claims that the government is bad at trying to fix the economy, but then Rick Perry hopes to take credit for “creating jobs” in Texas. Some now, are getting angry about the situation. Yes, we see some anger here – not at the ineptitude and utter stupidity of the debate taking place, but at the unemployed.
The argument goes that unemployment insurance is the source of the crisis. People are lazy, so when they receive a check, they stop looking for work. Some have gone so far as to suggest that the jobs are there, people just need to stop being lazy and go look for them.
This author was, until last week, part of the “long-term unemployed” statistic (meaning that he held no actual work for six months or more). He had to go on unemployment insurance, and justified it because it beat starving and he had paid taxes while employed to fund the program. The program itself is a nightmare. You are supposed to receive it for up to one year and in the state of California, you can apply for an extension if you start to run out. Most employers contract with unemployment claims agencies to contest the workers’ abilities to participate in the program. After his first check, this author received a notification informing him of his former employer’s decision to appeal. The appeal process may result in all money collected after receiving the first notice having to be paid back and the candidate won’t receive a hearing date for 12 weeks. The whole program is not preferable to an actual job, even one that pays less than the insurance. For some politician to accuse those collecting of “leeching” off the system is personally offensive; this author can document applications to several hundred unique positions over the past year. Granted some might leech, but some have always leeched. For a mass majority of people who found themselves unable to secure a job, the insurance benefits were all they could get.
Yet still we maintain that jobs aren’t the answer. While they’re certainly very important, they won’t fix the problems we face.
First, we need a moral correction. The truth remains, a vast majority of people took out home loans that they couldn’t pay off because they assumed that houses, unlike every other good in the economy, would never experience a downturn in price. The banks, of course, aided people and had no problem helping them lie about their means since a loose monetary policy combined with the promise of a government bailout made lending completely safe. The government responded in kind by bailing these faulty loans out and continuing the smoke and mirrors show of printing money and creating artificial growth in people’s income. In a word, corrupt people in government helped corrupt banks guarantee faulty loans for corrupt lenders, and when this fell apart, the corrupt government responded by bribing people with money essentially taken from the poorest classes, who didn’t have the means to even lie to the banks. (Inflation, as Hayek teaches us, is a triangle. Those who receive the money first can buy goods in the economy at pre-inflation prices. As the money trickles through, prices raise so that those further away from the stimulus/bribe have to pay more without receiving more.)
Second, we need an economic correction. Policies shouldn’t be about jobs, because it’s misleading to talk in terms of employment. The official employment numbers overlook those whose benefits have expired and those who have simply given up looking out of desperation. The government will never know how many people are actually unemployed, and even if they could they would likely lie to you about the number (it would be very unpopular to be honest about it). But even if we were to assume that the insight about the true number existed, the government could put them all to work overnight. Send everyone a shovel, promise them a paycheck, and have them start digging holes. Very easy, and the unemployment number goes away just like that. Yet that’s not economically beneficial, nor is it personally beneficial to many of those out of work – while companies are reluctant to hire unemployed candidates, they’re also reluctant to hire former government employees because people who work for the government are thought to be inefficient and sub-par to normal people. The focus, instead, should be on production. This is something no politician can interfere with or take credit for. Any misguided stimulus policy will always curb more production than it creates. Production is a true measure of economic well-being because where there’s production, there is a drop in price (as more is produced), a higher standard of living, and efficient employment – someone has to make all the new stuff.
If we ignore the hard issues: that we’re a corrupt and degenerate nation that operates under faulty assumptions about how the world works, we will have to answer for our mistakes. It is time to repent for false errors and find real solutions.