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Jobs are a means not an end. I've never worked at a job to work at a job. I work at a job to provide for my family and for my other goals in life. This sort of

• knowtheory 15y ago
  As far as I understand it, Keynes's broad point was that even the straw man of creating jobs just to create jobs is better than the alternative of rampant unemployment (where people rely on charity and public works, and still don't contribute to GDP). That said Keynes's primary point was that governments should invest and spend money wisely to do stuff the private sector can't or won't do. ====================================== You and I can agree that we'd love to live in a world where people pursue employment due to interest and/or a drive to make the world/economy better. That's not the world we live in, and I don't know how we get there from here. Lastly, markets are manipulable and are manipulated, and governments aren't the only actors doing so.
  • cma 15y ago
    This assumes that the downsides of labor (monotony, debilitating or fatal injury (particularly in the case of much-touted "shovel-ready" projects)) don't count. If the end product of the artificial jobs minus those downsides provides less individual and social utility than simply paying the worker a stipend, we should go with the stipend and forget the work.
    • davidw 15y ago
      There are probably some psychological benefits to doing something, even if it's only building trails in the forest or things like Timberline Lodge or various endeavors like that. Probably best to study it though, rather than simply conjecture.
    • krschultz 15y ago
      You are vastly over-estimating injuries on construction projects. They happen, but not like it was 1920 or 1850 or 2000 BC.
      • cma 15y ago
        Fair enough, but I'll assume (based on your omission) that you are vastly underestimating the downsides of monotony.
    • lsc 15y ago
      I think that most people would prefer a job doing something they feel is useful. Heck, I'd take some moderate risks to feel like I was earning my keep. I think this is why most public assistance programs in America have been tied to 'service' of one kind or another. It's why social security is at least partly tied to your taxes while you were working. We've got our pride; and yeah, I agree it's irrational, but that's just the way many of us are. Actually, I got one of those hiring bonuses last year; I mean, I didn't know that I'd get it, and it was only a few hundred dollars, so it didn't factor in to the hiring decision, but I did make someone an actual employee, and my accountant told me I got a credit for it. (The guy was a contractor before, but he did get a substantial raise, and a steady salary rather than a varying paycheck based on hours worked.)
  • CWuestefeld 15y ago
    we'd love to live in a world where people pursue employment due to interest and/or a drive to make the world/economy better We do, and in fact it is necessarily so. See "Invisible Hand": (the following is a quote from http://en.wikipedia.org/wiki/Invisible_hand http://en.wikipedia.org/wiki/Invisible_hand ) the invisible hand was created by the conjunction of the forces of self-interest, competition, and supply and demand, which he noted as being capable of allocating resources in society. This is the founding justification for the Austrian laissez-faire economic philosophy, but is also frequently seen in neoclassical and Keynesian economics. The central disagreement between economic ideologies is, in a sense, a disagreement about how powerful the "invisible hand" is.
    • dhume 15y ago
      That's an emergent property of the system as a whole, not the desire of the typical participant, and it is not based on any motivation for working beyond desire to collect a paycheck.
      • CWuestefeld 15y ago
        You're absolutely correct about that. But the end, aggregate effect is indistinguishable from the desired state.
  • rgraham 15y ago
    Keynes wanted governments to save in good times so that they could spend in bad times. We just spend more all the time. It can't work.
• Spyro7 15y ago
  Thank you jswinghammer. This statement right here summarizes the whole problem with the OP: "The only jobs that are sustainable are the jobs that produce something that other people actually want." This is exactly it. You can not stimulate an economy simply by pushing up production on the supply side. Mark Cuban's idea seems appealing on the surface, but he makes a serious assumption. He implicitly assumes a positive net benefit after you give these companies money and they create jobs with this money. Look, if you transfer money from the government to the companies to the people then that is just a transfer payment. Moving money around like that does not create wealth within a country, and that is what we need right now. We need to spend money on things that generate positive net present value, and we need to curtail spending money on things that do not meet this criteria. In order for Mark Cuban's idea to work, all of these companies must be employing the additional labor towards activities that are economically profitable. Here's a quick thought exercise. What is the likelihood of a company being engaged in economically profitable activities given that it is taking advantage of this program? (It is reasonable to assume that a company with a healthy balance sheet and a healthy income would not want to deal with government bureaucracy willingly.) Also, as a side note, the following quote from the blog post is a bit inaccurate: "(Stunningly, bailouts excluded)." That the bank bailouts were repaid so handily owes very little to the bailouts themselves. Thanks to extraordinary measures taken by the Federal Reserve, the banks were able to borrow money at an interest rate of virtually nothing and then use this money to purchase U.S. bonds - effectively lending it back to the U.S. government. In addition to this, the Federal Reserve also took the unusual step of dramatically expanding its balance sheet (removing toxic liabilities from the banks themselves). That was the real bailout, and it was much larger than the pithy amounts that you saw reported by the administration. To get a sense of the scale and size of the real bailout, please take a look at this graph: http://economix.blogs.nytimes.com/2009/05/07/fed-balance-sheet-expansion-some-takeaways/ http://economix.blogs.nytimes.com/2009/05/07/fed-balance-she... Edit: Also, I forgot to mention one more thing. The current negative rates on U.S. debt would almost certainly change if we began to issue substantially more of it. As Europe is rapidly learning, the debt market is far from a static environment.
  • knowtheory 15y ago
    Particularly if this is not a static situation we should take advantage of it until until an equilibrium is met (no we should not over leverage, that's a terrible idea). The point is that we have an opportunity to do responsible investing. I am sympathetic to the argument that the US government is incapable of doing responsible investing. So who is, and how can we get them to act on the US government's behalf so that we all benefit?
• prostoalex 15y ago
  For an individual yes. But when a politician talks about "jobs", what they really mean is "government revenue from income tax", and those governments that are highly dependent on income tax revenues view that as priority.
• curt 15y ago
  This is exactly right. Not many people understand the Austrian School of Economics, whatever you want to call it, "supply side", "tax cuts", not even the politicians that campaign for it. Not all tax cuts are created equal and the goal is not to get people to spend money but invest. The only tax cuts that work are across the board cuts that change long-term behavior. All these credits and "targeted" cuts don't do anything and might even hurt. The goal of tax cuts are to spur investment by lowering the required return on investment allowing capital to flow into more productive projects (manufacturing, startups, etc).
  • curt 15y ago
    Really, down voting a post that tries to explain the Austrian School of Economics. Trying to suppress a view point are we?
    • william42 15y ago
      Really, down voting a post that tries to explain the Geocentric School of Astronomy. Trying to suppress a view point are we?
      • oconnore 15y ago
        Physics is far more empirical than economics, which is actually saying something, considering how little we actually know about physics. Economics is more like politics, if politicians were any good at math.
        • arethuza 15y ago
          Physics has proven itself again and again to be very useful - can't say I've noticed economics being anything like as effective.
  • deleted 15y ago
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• guelo 15y ago
  Taxes have been repeatedly cut and we still have 9% unemployment for years, what is your solution? More tax cuts? What if those cuts don't work? Tell unemployed people to stop being lazy? Do you think it's possible that even completely free markets could settle for years into an undesirable equilibrium?
  • jswinghammer 15y ago
    Liquidate bad debt. Let banks fail. Let's have one or two shitty years instead of 10-20 years of pain.
• ThomPete 15y ago
  I am surprised by the many naysayers. Not because I think that his thoughts are necessarily the solution but because the lack of constructive criticism. First of all I didn't read the post to say "this is to solution to end all solutions" but rather here is an idea could it work. Second how is this a top down approach in any classical sense? His claims is that the companies who think they can create jobs with more money, exist out there and he want the find a mechanism to find them instead of simply distributing at large across the system and see what happens. Third the US is probably the best country in the world to be an entrepreneur and business. There is very little in the way for anyone to find a need and then go out and build a business around it and there is a huge market for that. If your claim is that it can only be solved by making that part easier then the entire premise of capitalism seems flawed (I don't believe it is and I am not saying you are claiming that either) The problem fundamentally is that you can only adjust your metrics so far before they become meaningless. The first step to get the US out of their debt is to raise taxes. That won't make the startup environment better but it will start showing that the US as a country are ready to pay their bills instead of speculating their way out of it. And before you start calling me a socialist and other nasty things let me just pre-empt this by the following. I live in Denmark, a country with a progressive tax system +55% tax for the highest incomes and a sales tax of 25%. A car here cost 3 times the amount of a car in the US all because of taxes. I am a member of the only liberal (in the european sense) political party and is fighting to get lower taxes. So I am not saying raise taxes lightly. I am simply saying that the US have reached a point where the low tax is working against them not for them. All systems have thresholds especially economic ones. To keep wanting more of the same ends up creating a self sustaining effect after you reach a certain point. The US have reached that now.
  • jswinghammer 15y ago
    Historically the US federal government has never collected more than 20% of GDP in taxes. Doesn't really matter what the tax rates are. The US needs to get out of debt and I think ending wars is the way to do that.
    • rgraham 15y ago
      This is an important point. Raising taxes is not a static game either. There are a lot of ways people with money avoid taxes now. I think Cuban was right that we do have a spending problem. We spend too much on things that are not important. We should cut debt, but the debate around this issue has been framed as a false and confusing dichotomy by the two major political parties.
• jamieb 15y ago
  The phrase is "Pushing on a string". Give anyone some money and they'll save it, not spend it. They'll save it because next week milk and eggs will be more expensive, while houses and electronics will be less expensive. on craigslist. nobody is buying new stuff when the guy down the street is selling his PS3 to make rent. Essentials are increasing in price. Luxuries are decreasing. What company is going to create jobs in this environment? And what if you did create jobs making more of X: now X is cheaper. Deflation. We need inflation. And that means pissing off the Chinese. We need to accurately price assets. And that means letting some banks fail.
  • david927 15y ago
    The differences between a recession and what we have now, a depression, include that interest rate changes are impotent and price deflation. Benanke did his disseration on the Great Depression and essentially stated that to fight price deflation they should have used monetary inflation. That's what we're doing. They don't even publish the M3 anymore but estimates are that the currency printing presses are going at full speed. The problem that Ben didn't anticipate is while rates are low and people want to borrow, banks -- flush with cash to lend -- don't want to. The monetary inflation can't keep up with deflation, which (you're right) is lethal.
    • jamieb 15y ago
      I'm not the one modding you down, and I should clarify: by "inflation" I mean "increase in prices", as opposed "greater monetary availability". The fed is, with QEx attempting to provide greater liquidity, thinking that this will cause price rises, and in turn spur spending and transactions. Of course its having no effect whatsoever. String pushing at its best. Also: the only people who want to borrow right now are those who are borrowing just to stay fed. Rightly, the banks dont want to lend to them.
      • david927 15y ago
        I'm not modded down... by "inflation" I mean "increase in prices", = price inflation as opposed "greater monetary availability" = monetary inflation You can't control price inflation/deflation, you can only control monetary inflation. It doesn't matter why the banks don't want to lend, the point is, Bernanke's plan can't work until they do. (But let's be honest: it won't work in any case.)
• mbesto 15y ago
  Could you therefore conclude that the government really isn't all that able to create more jobs, but rather the private sector is? While I don't agree with the tea party, I do agree less government is the way to creating jobs. You can't just create jobs out of thin air because you want to; jobs have to satisfy a specific need/requirement.
• ataggart 15y ago
  You're doing an admirable job of channelling F.A. Hayek. I am reminded of one of his pithier lines: "The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design."
• vukk 15y ago
  http://www.fee.org/library/books/economics-in-one-lesson/#0.1_L11 http://www.fee.org/library/books/economics-in-one-lesson/#0....