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September 20, 2008
While our unemployment figure went up to 6.1 per cent last week the political class is desperately looking for answers in a highly charged election year. The disquiet is entirely understandable. So what will they promise to do for the folks out of work.
Basically, both presidential candidates right now are just promising whatever it takes. Truth be known, there are really very few effective options available short of economic bailouts for auto companies. With the exception of more tax reductions to encourage all business to take their entrepreneurial chances, most remedies have been tried and have failed all the way from the Depression to present day.
Sen. Barack Obama wants to issue another round of tax rebates, the most recent of which did little to spur the economy as a whole. It’s also fair to say his party favors signature card recognition for organizing a union. Now recognition of union status requires an NLRB secret election with a majority vote for organizing.
An easy open-door process such as that truly would be a deterrent to investment in many businesses. My own experience with five unions at the Journal proved management and unions could, to a reasonable degree, work together. Elsewhere I experienced dogged opposition backed by union thugs to accomplish anything but to increase pay and benefits.
With those “wise guys” in charge of organizing with signature cards the outcome would never be in doubt.
I must say, though, in some industries such as automotive, both unions and companies were complicit in avoiding standoffs and strikes. Their strategies brought us to where we are today.
Other cures for unemployment promoted by many pols are government-guaranteed loan bailouts on the order of Chrysler years ago. Knowing that curse would pop up again, I thought it wrong at the time. With the shape the auto industry is in now, it could easily become a recurring supplicant for taxpayer dollars and eventually morph into a nationalized industry, God forbid.
Democrats are quick to back limiting trade with competitive countries that threaten us. That’s a two-edged sword. Which industries do we protect, which do we not? Or, do we protect them all? History shows that to be disastrous.
Tax and other penalties for those companies that move manufacturing overseas has, of course, been suggested. Ignored is the idea we should ourselves become more business-friendly and competitive.
Since the nation’s work force has grown, mainly through immigration (mostly illegal), available work tends to be low skill and pay, thus limiting options for workers used to living more prosperous lives. There has been no talk about controlling immigration so far in this election.
So what works? Very few of the usual political ideas listed above. Make-work programs begun by FDR during the Depression also had little impact on the working class other than to convince them someone in government cared about their plight.
But what have really worked are big tax cuts by the Bush (yea, the devil himself) administration that eventually added eight million jobs, many of which had been lost under Bill Clinton’s watch.
One thought on what happened to the economy of Great Britain after WWII. The laborites took over Parliament and instituted a socialistic system that resulted in nationalization of key industries and pro-labor regulation of every imaginable kind. Long-term effects on the British economy were catastrophic. Britain was called the “sick man” of Europe and nobody saw a way out of the situation until the "iron lady," Margaret Thatcher, became prime minister.
She changed the economic tide and Britain slowly came out of its illness, to become prosperous and competitive once again.
While we are currently in a bit of a hole right now, I hope we don’t repeat the economic agony Britain submitted itself to with its experiment with socialism.
--While local television reporters continue to refer to skyrocketing gasoline prices, cost at the pump by the end of last week has declined to around $3.29 per gallon from just short of $4 a few weeks ago. That’s around 70 cents a gallon less.
--I was impressed by the speech delivered at the Republican National Convention by Gov. Sarah Palin of Alaska as she accepted nomination for vice president. She was poised and forceful and delivered her speech in terms regular people can understand.
With simple, direct language I think she outshines even the super-charged oratory of Barack Obama. She awoke a hall full of sleeping Republicans. I hope she can do the same for the nation.
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