Republican stupidity (I know, that's a redundancy)

Discussion in 'Politics' started by OPTIONAL777, Apr 4, 2011.

  1. (Source: Tonawanda News)trackingBy Eric DuVall, Tonawanda News, North Tonawanda, N.Y.

    April 03--This might be the dumbest thing I've ever heard. The Republican Party's official position on job creation is this: If the government lays off workers on a mass scale, it will help employment.

    How is this possible? Someone in the House GOP caucus has missed their calling as a fantasy novel writer, for starters.

    But just so we're all clear, I'll spell out their argument. The Republican staff at the Congressional Joint Economic Committee asserts that if we lay off tens of thousands of skilled workers (teachers, mostly), it will create a larger pool of available workers. Supply and demand would dictate the cost to hire a worker would go down because there would be more people looking for work. This, they argue, will make private businesses more likely to hire.

    This is the craziest economic theory I've ever heard and, as Nobel Laureate economist Paul Krugman pointed out last week in the New York Times, it is the same advice given to Herbert Hoover as the nation plunged into the Great Depression.

    We should start with the obvious. If tens of thousands of teachers are laid off, it will hurt employment numbers because there will be tens of thousands of laid off teachers. This isn't economic theory. It's basic logic. If more people are put out of work, the unemployment rate will increase.

    So there's that.

    Then there's the idea that government spending is what's holding back the economy from creating jobs. It isn't -- or at least it is a much less significant factor than several other things. Furthermore, the number of people the government employs has precious little bearing on job creation.

    How do we know this? Empirical evidence. New York, a state that has more people on the public payroll than most other states, has an unemployment rate that is roughly the same as the national average. Certain states are faring better, but the state of a state's economy at the beginning of the recession is a much better predictor of their present unemployment rate than the number of people who are paid with tax dollars.

    Then there is the tired arguments in support of supply-side economics. American corporations are sitting on trillions in profits and they aren't, by and large, using that money to hire more workers. In fact, many businesses are still decreasing their work force or forcing employees to take pay cuts.

    The business community already has the tools to put Americans back to work, but instead of doing that, they would rather pump up the balance sheet. It's why the stock market has rebounded, but unemployment is still too high.

    Do you need another argument about why this idea is a horrible one? Because I've got one.

    If laying off public sector workers will increase the labor pool and lead to job creation, why hasn't it happened already? There's hardly a shortage of laid off government workers as states from Sea to Shining Sea shed workers to balance budgets. If this gem of an economic policy were true, wouldn't we be seeing it by now? Would businesses not be itching to snap up a 27-year-old former teacher? Because I know a few of them and they're not having a ton of luck finding new work.

    Budget cuts are necessary in the not-too-distant future and, of course, the government always has an obligation to spend no more that it must. We cannot sustain the present amounts of debt our nation has.

    But far more important is this basic concept: We will never responsibly balance the budget if unemployment remains at 8 percent or 9 percent. Creating jobs creates wealth, which generates more in taxes and helps pay down the debt. Combined with entitlement reform and thoughtful spending cuts in all areas of the economy, we can climb out of this hole we find ourselves in.

    Doing something incredibly dumb, however, isn't going to help.
  2. Lucrum