And can the liberties of a nation be thought secure
when we have removed their only firm basis,
a conviction in the minds of the people
that these liberties are the gift of God?
That they are not to be violated but with his wrath?
Indeed I tremble for my country
when I reflect that God is just:
that his justice cannot sleep for ever.
Thomas Jefferson
John Stossel's Debunked Myth of the Day
Myth: Firefighting must be done by government.Channeling Their Inner
Truth: More than 11,000 private firefighters under contract to the federal government in 2012 to fight wildfires. In some parts of America if your house catches fire, it's a private business that will come to put it out. Hugh Futrell is Assistant Chief of a privately run fire department in Georgia.
Are you kidding? Seattle's public sector use of "brown bag" and "citizen" might be considered offensive by some blacks or residents? We now have yet another entry for the "Get a Life" file.... We cannot go through life giving even 1 hypersensitive individual the right to trump conventional preferences, e.g., an atheist irritated at seeing a Ten Commandment monument on Texas state grounds.
Maybe, for instance, I object to federal infrastructure being named after Robert Byrd, a former member of the KKK--or FDR whom violated (no matter what his stacked SCOTUS decided) the rights of Japanese-Americans during WWII. Maybe I object to the term "marriage" being used by Washington state bureaucrats to cover nontraditional relationships. There are millions of examples.
Let me suggest that any government bureaucrat whom spends his or her time (i.e., taxpayer money) engaging in such trivial pursuits is one bureaucrat too many.
Economic Uncertainty, the Jobless Recovery, and the Latest Job Numbers
Is policy uncertainty affecting our bleak employment numbers? Yes, and despite Obama's insistence that he has the "solution" (by things like infrastructure "investment", public sector hiring, etc.--which is really putting a lipstick on the pig of crony unionism and Big Engineering), he is really the incompetent driver of uncertainty. What do I mean by that? The biggest examples that should be immediately obvious was when he played games of political chicken over the Bush tax cuts in 2010 and 2012 and the stand-off on the debt ceiling increase (coming up again). Then take ObamaCare, including an illegal one-year postponement of implementing the (undesirable) employer mandate, the related penalty of small employers taking on one too many workers to avoid the penalty, workers making a dollar too much to qualify for government subsidies, etc. We could also mention things like EPA policies affecting utility costs, federal permits for development of natural resources, etc. I would also say uncertainty in monetary policy. Another indicator would be volatility of economic forecasting.
A couple of Fed researchers, referenced by John Taylor and indirectly by Don Boudreaux, make reference to the Beveridge curve: "A Beveridge curve, or UV-curve, is a graphical representation of the relationship between unemployment and the job vacancy rate (the number of unfilled jobs expressed as a proportion of the labor force). It typically has vacancies on the vertical axis and unemployment on the horizontal." Normally we see employment pick up as job vacancies rise. What we are seeing is a rightward shift of the Beveridge curve since late 2007: that is, we are seeing more vacancies at a given unemployment rate. Why is that happening? You see one explanation being an applicant skill/job mismatch; this is why Obama has been focusing so much on training. It seems intuitively obvious, even to a layman economist as myself, this is improbable.
Just to give an anecdotal example, I've found in my own search for gigs during the Great Recession that I will be filtered out for a modest Oracle version release. For example, I have nearly 10 years experience with 3 major releases of EBS, Oracle's ERP suite (competitor to market leader SAP). The opportunities for EBS DBA gigs in the metro DC area are slim, so I haven't had an opportunity to work with version R12. Obviously I mastered the earlier releases on the job without direct prior experience, and it would take little time for me to ramp up to R12; not only do I have 10 years of experience, but 2 advanced business degrees. The idea that R12 is a legitimate job skills mismatch lacks credibility; there are incidental, not substantive differences between releases. (HR recruiters may not realize this, but hiring managers do.) It's a lot easier to take a highly intelligent applicant whom can adapt to job requirements than take a mediocre applicant and teach him or her to be highly intelligent/more productive.
A second hypothesis is that overly generous, morally hazardous unemployment compensation have resulted in unemployed workers milking the benefit and choosing not to apply for relevant vacancies. To a certain extent, this may be relevant for a number of workers, say, laid-off auto workers anticipating being called back or some finding no work that pays at least as much as their unemployment check. I will simply point out that I have never drawn a penny of unemployment during the Great Recession and millions of structurally unemployed people have seen their benefits expire and want to be employed full-time; these people still have ongoing bills to pay and end up draining their savings. So this explanation falls short.
The authors advance a third explanation: economic policy uncertainty:
We present evidence that heightened uncertainty about economic policy during the recovery made businesses more reluctant to hire workers. When uncertainty rises, businesses become more hesitant to hire. They reduce recruiting efforts by raising hiring standards, increasing the number of interviews, or simply not filling vacancies. For instance, some businesses may interview candidates multiple times and end up deciding to postpone hiring altogether.
Our results suggest that heightened policy uncertainty accounts for as much as two-thirds of the recent shift in the Beveridge curve. We estimate that uncertainty pushed the unemployment rate 1.3 percentage points higher by late 2012 than it would have been based on trends from the decade before the downturn.I would say what the authors write in the shaded area is spot on with my experience. To give an anecdotal example, I was cold-called directly by a hiring manager in Sept. 2011; it was a high-priority fill, and he pressed for an immediate face-to-face. And then it was waiting for Godot, all sorts of bureaucratic excuses. (I withdrew before year-end.) I got an email the following February they finally filled the position.
Yes, I know that Obama and his partisan cohorts are going to point fingers at "obstructionist" Republicans. But the indisputable fact is that the 111th Congress with Dem super-majorities could have acted early in the session to deal with the tax cuts, the debt ceiling, etc., not to mention business tax reform, but they had "higher" pushing-on-a-string priorities: ObamaCare, so-called "financial reform", an overly-expensive, ineffective stimulus package. The massive debt is competing with the private sector for financing. Obama has put ideology over, e.g., the Keystone pipeline and expanded drilling on federal lands, which would shore up the dollar, narrow the trade deficit, and add thousands of good-paying domestic jobs.
It's hard to explain how Obama could mismanage a situation worse if he was actually trying to sabotage the economy.
Let me make a final point about infrastructure. There are a lot of businesses and conservatives whom are sympathetic with infrastructure. But it's never made sense to me why the Internet boom, which has grown despite government, not because of it, needs the government, and it bothers to me that Obama and Jerry Brown continually hype high-speed rail: they have absolutely no clue that it does not constitute a viable business model. I also don't want the Feds to engage in a de facto takeover of state/municipal infrastructure or to bail them out for failing to maintain/fund existing infrastructure. What the government needs to do is not to spend money it doesn't have but empower the private sector, which has a vested interest to serve paying users and to operate efficiently. The idea that government which has built roads that are routinely poorly maintained or used beyond capacity has somehow figured it out to do it with corrupt union provisions, without economic competition, etc. simply lacks credibility.
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| Beveridge Curve Shift Courtesy of the Federal Reserve |
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| Courtesy of Michael Ramirez and Investors.com |
The Beatles, "Lucy in the Sky with Diamonds"
