Job Creation Ideas in HuffPo
Thomas Masterson and Pavlina Tcherneva were interviewed by the Huffington Post for an article on job creation policy. Tcherneva discussed the idea of a modern-day WPA, echoing a call she made at the outset of the Obama administration (in this policy note) for the government to provide an explicit employment guarantee targeting the unemployed. Masterson highlighted his research with a team at the Levy Institute on the employment and distribution benefits of investing in social care services like early childhood care and home health care for the elderly, and poured cold water on the idea of providing tax incentives for new hiring (“If they can’t sell the stuff that they can make now, then why are they going to hire more people?”).
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The economic facts are eerily familiar and no less depressing: No new jobs were created in August. The national unemployment rate is more than 9 percent. (It is probably closer to 20% when the unemployed who have given up hope of finding a job and the underemployed are counted.) Some states have an official 12% unemployment rate or even higher. Thousands are losing their jobs every day. President Obama has thrown $4 trillion into the economy, including billions to save the banks and car companies, yet not one job has been created. Housing prices continue to fall as more people foreclose. Houses are being demolished in an attempt to elevate housing prices. Once-flourishing neighborhoods now look like ghost towns as jobs disappear. Consumers who are unsure if their jobs are secure, and the many unemployed millions, aren’t spending because they lack the money to spend. Most live paycheck-to-paycheck and barely make ends meet. Republicans, Democrats, Tea Party politicians, Independents and every other political persuasion has either failed to make proposals to create jobs, or has implemented proposals that have failed miserably.
I believe there is light at the end of this bleak economic tunnel. Americans need not wake up each day with feelings of despair. To that end I would like to propose solutions to jump-start the economy.
It should be crystal clear by now that tax breaks for businesses and individuals have failed – and will continue to fail – because businesses and consumers can’t spend tax breaks. And that is the key to reducing unemployment: consumer spending. According to many economists, some 70% of economic activity in the United States is generated by consumer spending. Consumers and businesses need cold hard cash in their bank accounts.
So my proposal is simple: the federal government should give money to where it will do the most good: directly to consumers. Each taxpaying family earning under $200,000 annually should be given a minimum of $25,000 to spend as they please. When consumers spend, jobs are created. Do families deserve this federal bailout? I firmly believe that they do; it was taxpayers who bailed out the banks and car companies. It is high time for the federal government to show its gratitude to taxpayers by bailing them out. My proposal would result in a short-term decrease of federal government revenue, but the decrease would eventually be offset by tax revenue generated by working people.
A stiff tariff should be imposed on goods imported from countries which have an adverse military, political and/or economic relationship with the United States. For example, China has for many years blocked American imports, dramatically increased its exports to the United States, failed to let its currency float, abused human rights, and created an adversarial political, economic and military relationship. It is morally reprehensible for manufacturers to do business in China or with any other country which does not share our economic, military and/or political values. The tariff would not only send a political message to these countries but would bring back jobs to America.
The income tax system should be scrapped entirely and replaced by a consumer-oriented tax. A 6% tax on all goods and services, including food and medicine, should be levied by the federal government. States and local governments can add another 2, 3 or 4 cents. There would be more than enough money to finance federal, state and local governments.
The United States should vacate Iraq and Afghanistan immediately, not in one, two or three years. While the kids in those countries are receiving a high-quality education at American taxpayer expense (and part of the curriculum focuses on how to hate Americans and other infidels), the infrastructure of many schools in the United States is crumbling, and layoffs of thousands of teachers and other support personnel continue unabated. The U.S. simply can’t afford to educate the kids in three countries. Our own kids should take priority.
Your comments are welcomed and encouraged.
Respectfully submitted,
Steven Morgan, North Hollywood, CA
[email protected]