Politics and Jobs

{{linespace:2.0}center}What to do about Jobs{/center}

         Our economy will not recover because our political leaders want political victory more than the well being of the American people.  We already tried two solutions: Bush’s plan-deregulate and lower taxes; Bernanke’s plan-pour money into the economy by keeping interest rates low and money cheaper.  Another decision that will keep demand down includes the health care law that raised the premiums.  Finally, banks must pay their share for the risky loans. 

         The Republican Party has taken full political advantage of the recession.  Before Democrats had control, the Republicans used the majority to lower taxes and to decrease regulations of corporations.  The economy crashed at the end of Bush’s term in late 2008. The government bailed out financial institutions deemed likely to cause systemic damage due to their size.  During the last quarter of 2011, the Republican party stalled passage of the debt ceiling bringing the nation close to default  and causing the stock market to tank.  Hopefully, Americans will not forget the leaders in charge before the last collapse in 2008. 

         The Democratic Party also took full advantage of the collapse of 2008 and passed the health care law and Dodd Frank regulations which have not helped the economy.  Dodd Frank fails to address the causes of the original financial collapse:  Banks made loans backed by houses, securitized the loans, and sold the loans to investors.  The relationship between lender and borrower ended as the lender no longer had an interest in getting the loan repaid.  In addition to the failure of Dodd Frank, the democrats put more burdens on businesses by creating the universal health care law.  I personally handle the budget for a large organization, and the cost per employee for health care increased by $2,400.00 per year.  Individual premiums increased as well because the insurance companies pass the increased risk onto the customers.  Health care organizations do not have a burden of decreasing costs under the new law, and we now must pay for increasing medical waste.

         Banks took risks with their profits to make bigger profits, and the taxpayers bailed them out.  They must pay for the damage they caused, and write down many of the irresponsible subprime mortgages that they created.  Until the mortgage mess gets settled, the economy will have to filter millions of real estate and construction related jobs back into other industries. 

         We had another nice speech about spending half of a trillion dollars on infrastructure projects and tax credits to businesses to stimulate jobs, but the jobs will end when the government spending ends and workers will find themselves where they started with no work.  We need the government to make hard decisions now about big ticket items such as Military, Medicare, and Social Security before the money runs out and a decision has to happen very abruptly.  I believe that given the proper regulation, the government could privatize social security and public schools.  Competition should cause the different organizations to provide services that people demand, and courts and antitrust laws will even out competitors.  The government should run hospitals, police, firefighters, and military as essential services.  Regardless of the direction, our leaders must make a firm stance and lead or the economic problems will grow.