Posts tagged with: unemployment

51ddbfc3cd43b.preview-300Paychecks are the vehicle for upward mobility, wealth and personal fulfillment in life, says Mike Varney. So why aren’t we doing everything in our power to create more of the jobs that are the source of those paychecks?

It’s all very simple. Companies create jobs. Jobs are what create paychecks. Paychecks are what gives individuals and families purchasing power and choice in their lives. Jobs and paychecks create futures and give humans a sense of purpose, contribution and connection. Jobs are the ticket that enable people to climb from survival to self-actualization on psychologist Abraham Maslow’s Hierarchy of Needs.

Joblessness creates the opposite effect: a downward spiral from hope to despair. Aspiration to desperation. In speaking with many of our local non-profit leaders, I have developed a real appreciation for the link between joblessness and insidious societal problems such as domestic abuse, drug and alcohol abuse, child abuse, homelessness and destruction of the human spirit. Societal ills are generally reported to increase and decrease in direct correlation to employment. Poverty and joblessness have no place to take root in a society where opportunity abounds and where people have a strong work ethic.

Read more . . .

Alejandro Chafuen, president and chief executive officer of the Atlas Economic Research Foundation and board member of the Acton Institute, recently wrote a piece for Forbes.com discussing youth unemployment in the United States. According to the latest report, U.S. youth unemployment is at 16.2 percent which is more than double the adult unemployment rate. The unemployment rate for youth in Europe is currently at 24 percent. Chafuen asks, “Can we learn from the European experience?”

Using data compiled by the economic freedom indices of the Fraser Institute in Canada, and the Heritage Foundation, in the United States, we recently looked at how economic freedom, labor regulations, social spending, and regulatory climate, correlated with youth unemployment. Against our preconceptions, at least as shown with our simple static analysis, there were no convincing results.  I will spare the reader the statistical jargon and graphs and focus on apparent contradictions. (more…)

German Finance Minister Wolfgang Schaeuble is a frustrated man. With unemployment rates in Germany hovering at around 8 percent, and Greece and Spain at almost 60 percent, he believes the EU is on the brink of “revolution.” His answer is not to protest signscrap the welfare model however; he wants to preserve it.

While Germany insists on the importance of budget consolidation, Schaeuble spoke of the need to preserve Europe’s welfare model.

If U.S. welfare standards were introduced in Europe, “we would have revolution, not tomorrow, but on the very same day,” Schaeuble told a conference in Paris.

Not everyone agrees. Italian Labour minister Enrico Giovannini says European youth are being asked to put their lives on hold, and that this is “unacceptable.” Werner Hoyer, head the European Investment Bank, acknowledged that there is no plan at this point to direct the spiraling downturn of the EU economy. There is, instead, a country-by-country “patchwork” approach. For instance, Greece is attempting to focus on job training and entrepreneurship for 350,000 young people, and France is working on a similar plan within its own borders. (more…)

If  you’re a young American adult (the 25-to-34 age range), and you have a good job, count yourself blessed. Most of your peers aren’t so lucky. The New York Times reports that “[o]ver the last 12 years, the United States has gone from having the highest share of employed 25- to 34-year-olds among large, wealthy economies to having among the lowest.”

Of course, young Europeans have been dealing with this for years. Greece, Spain and Portugal have unemployment rates between 17-27% (Greece being the highest), and the outlook is grim for most of the European Union (EU). Even taking into account that many young people may be studying or raising families and therefore not looking for full-time work, the deterioration of the EU’s economies is obvious. But it’s not just lack of jobs. As Samuel Gregg, Acton’s Director of Research, points out in his book Becoming Europe, “Europe’s social systems are under consider­able internal strain from the remorseless deterioration associated with unaffordable welfare states, population decline, low produc­tivity levels, and the preferential treatment of politically connected insiders.” (more…)

Record unemployment rates in Europe have been published and they should alarm Americans. Why? Because we are headed in the same direction. Nile Gardiner, of The Telegraph, is quite sure of this:

The United States isn’t just gliding towards a continental European-style future of vast welfare systems, economic decline, and massive debts – it is accelerating towards it at full speed. Or as Acton Institute research director Samuel Gregg puts it in his excellent new book published today [January 8] by Encounter, America is already “becoming Europe,” with the United States moving far closer to a European-style welfare state than most Americans realize.

The American Interest spins a further tale of woe, citing an 11.8 percent unemployment rate for the 17-nation Eurozone. Pity Spain: they have a 27 percent unemployment rate. Yes, you read that correctly: 27 percent. And young people (those under 25) are especially hard hit: 24 percent unemployment in the E-zone, with over 50 percent unemployment for young people in Spain and Greece.

Is it too late for America to reverse course? Read “Becoming Europe” by Samuel Gregg.

Read Nile Gardiner’s “128 million Americans are now on government programmes. Can America survive as the world’s superpower?

The Congressional Research Service (CRS), a group that works exclusively for the U.S. Congress, issued a report with one of the greatest titles I’ve ever seen on a government document:

Receipt of Unemployment Insurance by Higher-Income Unemployed Workers (“Millionaires”)

Now the first nine words are nothing special, typical policy-wonk speak. But whoever added in the word “millionaires” with scare quotes and parentheses is a genius. Most people would have been nodding off around the word “Insurance” but seeing millionaires (that’s such a quaint word nowadays) in the title makes you wake up and ask, “Wait, are they saying that millionaires got unemployment insurance?”

The answer: Yes. Yes they did. Millionaires have indeed been getting unemployment insurance. In fact, almost 3,000 of them in 2008 were on the dole:
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“Unless incentives suddenly stopped mattering during this recession, says Casey B. Mulligan, an economics professor at the University of Chicago, “it appears that the expanding social safety net explains some of the excess nonemployment among unmarried women who are heads of households.”
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In my commentary this week, I reflect on the unemployment rate of many newly separated military veterans of our Armed Forces. The grim jobs outlook affects our reservists and National Guard forces too. As You Were, a book I reviewed on the PowerBlog in late 2009, touched on this topic quite a bit.

My first job out of college was working on veterans issues for former Congressman Gene Taylor (D-Miss.) I was able to meet and get to know combat veterans from battles like Okinawa, the Chosin Reservoir and Khe Sanh. It was a rewarding and educational experience.

I suspect we will hear more from Washington about how to solve this problem with additional centralized government action. But we already have real commitments and promises to veterans that must be honored and a debt of $15 trillion and growing that is staring down at us. My commentary is printed below in its entirety.

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Playing Politics with Unemployed Veterans

Getting the U.S. economy back on a path to solid growth and the job creation engine jumpstarted is dominating the headlines, talk shows and policy debates in Washington right now. Many of the legislative prescriptions focus on the dismal unemployment woes of newly separated military veterans, whose rates outpace the civilian population. The troubling figures reveal a persistently bleak and stagnant economy.

National unemployment currently hovers around 9 percent, while unemployment for veterans of the Afghanistan and Iraq wars is more than 13 percent. Veterans in the age group of 18-24 are worse off, with an unemployment rate of 30 percent. Dead last in the Union is Michigan, where 30 percent of all former service members are unemployed.

These numbers may only get more discouraging as defense budget cuts push more and more from the active duty ranks into a weak job market.

Federal legislation passed at the end of last year seeks to address the problem with tax credits for companies who hire veterans. The measure could help some, but tax incentives like these generally offer no substantial improvement for removing people from the unemployment rolls.

Better immediate solutions would be omitting special licenses and training required by states to work in certain fields. There is no reason a combat medic in Iraq should not be able to work as an emergency medical technician. Many already have more training than their civilian counterparts do.

In his election-year State of the Union address, President Barack Obama painted a vision of a post-WWII society where triumphant veterans came back and created the strongest economy in the world. In his words, they understood that they were “part of something larger.” Part of that “something larger” after the defeat of fascism was a growing free economy, but they also faced a long twilight struggle against the spread of communism.

To restore prosperity today, President Obama called for a “common purpose” to rally behind. But the obvious common purpose, the reduction of the staggering national debt, was largely ignored by the commander-in-chief during his address. For the unemployed, all Americans, and a free economy, the debt is the largest obstacle to restoring prosperity and reawakening the most expansive economy the world has ever seen. The failure of the American government to live within its means threatens to eviscerate the promises made to America’s veterans. It is a classic case of one moral failing leading to another.

The “something larger” greeting veterans when they come home today is a national debt of more than $15 trillion and an economy burdened by more and more regulations. The White House has already requested a debt ceiling increase to a whopping $16.4 trillion dollars. So great is the obstacle, and so serious is the threat, Indiana’s governor Mitch Daniels dubbed it “the new Red Menace.”

The threat to veterans is substantial. Although veterans’ benefits are justly generous, the government’s fiscal crisis has put those guarantees at risk. Last year, for the first time, some in Washington talked about the necessity of trimming promised pensions and health benefits for military retirees. Politicians are playing politics with veterans when they talk of reducing promised benefits with one side of their mouth and say they are creating jobs for veterans with the other.

Older military retirees can remember a time when they counted on the promise of free health care for life. Many sacrificed more lucrative private sector careers, nonpayment for overtime, and additional time with their family because of patriotism and promised security. Now they pay premiums for their care.

Thomas Jefferson warned of the moral pitfalls and decay of debt when he said, “The earth would belong to the dead and not to the living generation.” Profligate spending in the past undermines our capacity to honor present commitments.

With their skills, work ethic, and patriotism, veterans have the ability to overcome the challenges confronting them. Most businesses and companies want to hire veterans. All they need is some assurance that their prospects going forward will not be dimmed by burdensome regulation or economic instability stemming from federal fiscal irresponsibility.

Washington does not understand there is little to be done in terms of a prescriptive policy to cure veteran unemployment. The oft forgotten Calvin Coolidge once warned, “Unsound economic conditions are not conducive to sound legislation.”

The best cure is still a market unleashed from needless regulation and spending policies that reflect a moral and rational resolve. In the end, a federal government that is broke can do little for veterans who earned and are entitled to benefits already promised.

Blog author: jballor
Friday, January 6, 2012
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In last week’s Acton Commentary, “Food Fights and Free Enterprise,” I take a look at the food truck phenomenon in US cities, sometimes called a “craze.”

In the companion blog post, “Food Trucks and First Steps,” I refer to Milton Friedman’s observation that there is a difference between being pro-market and pro-business. Art Carden has more on this over at Forbes.

As I note in the piece, the fight over food trucks is not just the stuff of big cities. The Carolina Journal has been following for some time the various dimensions of the political fights over food trucks in North Carolina, in both Raleigh and around the state.

One of the pieces of particular interest shows how political lobbyists for established businesses, in this case restaurants, can use legislation and regulations to squeeze out competition. But as Sara Burrows writes in “Regulations Hinder Food Truck Ministries,” these actions have negative impacts on faith ministries that would otherwise be helping to put people to work and getting them off the government aid rolls.

As Pastor Michael King says,

“But it’s obvious there is not a will in government to help the folks that don’t have jobs to create their own jobs,” he said. “They talk about wanting to create jobs. But it appears the folks they’re concerned about are only those who can go to the bank and borrow a bunch of money and put money in the ground.

“We don’t want them to be on government assistance,” he continued. “But the government is putting these rules in place and forcing the people to go on government assistance. How are you going to bring down government spending if you are putting rules in place so even if people want to create a job for themselves, they can’t?”

Congress insults our intelligence when it tells us that Chinese currency games are to blame for our trade deficit with that country and unemployment in our own. Legislators might as well propose a fleet of men-o’-war to navigate the globe and collect all its gold: economics is not a zero-sum game.

An exchange on yesterday’s Laura Ingraham Show frames the debate nicely. The host asked Ted Cruz, the conservative Texan running for U.S. Senate, what he thought about the Chinese trade question. Said Cruz, “I think we need to be vigorous in dealing with China, but I think it’s a mistake to try to start a trade war with them.”

“The trade war is on, and we’re losing it,” Ingraham responded. “[China is] subverting the principles of free trade.”

We blockaded the ports of the Barbary pirates when they subverted the principles of free trade — is Ingraham looking for a similar response now? No, she wants weenier measures: just some punitive sanctions here and there to whip China back into shape (because those always work).

Conservatives who are looking through the Mercantilist spyglass have got to put it down, because it distorts economics in the same way Marxism does. Economic growth and expansion of the labor market don’t come by the redistribution of wealth; they come by allowing man to exercise his creative talents, to innovate, to produce.

Protectionists also tend to ignore the inverse relationship between the trade deficit and the inflow of capital to a country. We are a nation of entrepreneurs, and entrepreneurs require investment. All business requires investment. If it’s Chinese investment, then Chinese investors see long term value in the U.S. economy. Sorry I’m not sorry about that.

Our leaders do the country a disservice by proclaiming that unemployment is caused by a trade deficit, and that a build-up of retaliatory tariffs is the way to fix the trade deficit. And they do other countries a disservice also, because U.S. protectionism hurts our trade partners (or potential trade partners). Holding back U.S. economic progress by artificially retaining manufacturing jobs, for example, means that workers in China or Vietnam are denied employment opportunities. It’s mindless selfishness.