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Countless academics who have never stepped foot off a college campus have alleged the reason we’re all here is to better our understanding of the humanities and sciences and leave as well-rounded people with a passion for knowledge.
We know better. In reality, the process of elimination brought us all to college, as we knew we didn’t want to join the Air Force and you can’t get to the NBA straight from high school anymore. Oh, and we’d all like high-paying jobs. Unfortunately, massive recessions aren’t conducive to employment opportunities for recent college graduates, and instead of sitting pretty with four-year degrees, some of us will soon be left scrambling with an art history diploma in one hand and a Cold Stone application in the other. It might not be the end of the world as we know it, but two months mashing candy into ice cream would leave anyone hoping the Mayans were right.
Recently, in an attempt to either justify their government paychecks or predict the future, the Wisconsin Department of Revenue forecasted that state unemployment would reach 8.9 percent by the end of 2009 and would top out in 2010 at 9.1 percent. This was by no means a comforting analysis, but most people would rather take a steady descent into poverty than a freefall. Of course, if there’s one thing we’ve learned over the last year, it’s that the people who are trained to know the economy have absolutely no idea what they’re doing. You can lock 12 monkeys in a room with typewriters, and if you give them enough time, they’ll eventually devolve into Jim Cramer.
I say this because just last Friday the Department of Workforce Development, which apparently isn’t the DOR, but I guess does the same thing, announced the state unemployment rate hit 9.4 percent for the month of March, shattering the DOR’s peak with a whole year to spare. Hopefully, this means the worst is behind us and we can all expect to be welcomed into the job force with open arms, but I fear that just like Jackie Wilson said, this’ll just keep lifting higher and higher.
So, who you gonna call (out)? We can’t blame Bush for everything, and even if we could, shooting fish in a barrel isn’t as fun when you’re too poor to buy fish. Or barrels. Personally, the most interesting culprit in an era defined by free homes and little oversight — the financial
Much of FDR’s New Deal was nothing more than thinly veiled pork spending, and the lasting effects of his political pork are as obvious as the effect left on my cholesterol after those four Baconators I had last week. Building parks and commissioning artwork during the Depression may not have balanced the budget, but it did provide thousands of unemployed people the ability to provide for their family, and in the long-run helped pull our country out of some serious trouble. Sure, we threw a war in there for good measure, but the government didn’t exactly save money by shipping boys to
This fear of government spending is nothing new. Nobody likes taxes, and when money’s tight, it’s easy to blame somebody else for spending too much of your hard-earned cash. But history tells us the one other time the bottom fell out and
Sean Kittridge ([email protected]) is a junior majoring in journalism.
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Fantastic as always Mr. Kittridge.
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Great article. As an econ major, I’m glad someone finally pointed out that deficit spending on pork is the textbook Keynesian way of stemming a recession. And before a conservative tries to say that the New Deal didn’t work, and cites examples of how unemployment in the US increased in 1938, that increase is due to Roosevelt deciding to get a balanced budget in 1937. Sweden went all out Keynesian when the Labor Party took power in 1932 and fully recovered in 2 years by simply spending money they didn’t have.
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Before Obama resorted to tax-supported bailouts, he should have looked for areas in federal spending to cut back on. The war in Iraq is unpopular with most Americans. Why not bring our troops home? May as well bring them home from Afghanistan too. They let Osama bin Laden get away and blew their chance to nail him. We could also shut down all the military bases we have in over 100 foreign countries. They’re Cold War relics, why hang on to them?
Before I’ll go along with deficit spending, I’d like to see our clueless leaders in Washington lead by example. How can they preach to us taxpayers about living within our means while they’re spending money like it’s going out of style?
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Sean and all other wannabe economists,
The American consumer is the backbone of the American economy. If the goal is “circulating money through the average American”, tax cuts are the single most immediately effective method of achieving that. Government policy should stimulate savings and spending by the consumer in times of recession. More dollars in the hands of the citizens stimulates both savings and spending. Personal spending stimulates production, saving and creating manufacturing and service industry jobs. Personal savings become liquidity in the banking and lending system, reducing lending rates and strengthening reserves. Personal savings also mean dollars for college tuition as well as alumni charitable contributions for college grants and financial aid.
Tax cuts work. They work every time they are used during recessions. Trust the American people to make the right choices. As our current and past administrations have sooooooo aptly demonstrated, bureaucrats making pork barrel decisions create disasters, one after another. We are sowing the seeds of the next disaster right now, with the out of control spending by Obama and the democrat controlled congress. A bankrupt country does not create jobs for graduating college students.
If you learn nothing else from your Econ classes and history studies, hew to this simple time proven truth. In times of recession, cut taxes and cut pork.
The American consumer will do the rest, making sure the dollars are applied with far greater efficiency than any politician or politically driven committee ever can.
The sooner you realise that, the sooner our country will regain its traditional strength.
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9:40, what do tax cuts do for the unemployed?
Don’t they just make the employed slightly more wealthy; don’t they have to spend all their tax rebate, then, to help the economy recover and create jobs? Isn’t a tax break just personalized pork, rather than society’s shared pork? I’d rather have a new highway than watch Shaq buy another super man-themed SUV, for example.
Tax cuts have been proven to work on what planet? There was a lot of GDP red during the supply side years. The Clinton years, in contrast, looked like an economic model to replicate.
http://static.seekingalpha.com/uploads/2008/1/30/gdpannualized1_2.png
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Well said 9:40!
Sorry Sean, but the massive FDR spending was really not what put an end to the Great Depression. It was the war and a populace that were lock step behind the war effort and suffered dearly for 5+ years. When Japan attacked at Pearl Harbor, the country changed in an instant. The folks would do anything to pay them back - to exact revenge. Industry came to life in support of the war effort. Men and boys went off to fight. Even college professors and actors went off to fight. The factories were filled with women working for nickles to support the “boys”. Since the economy was then a war economy, there was nothing to buy. Couldn’t buy a car when the auto plants were turning out Jeeps and trucks and tanks. Couldn’t buy tires for the car you already had unless you had a tire coupon. The entire production on “rubber” was dedicated to the “effort”. Toilet paper, meat, potatoes, shoes, and on and on. You needed a coupon to get them. Everyone suffered. But were happy to support the effort.
So what did those on the home-front do with the small wages they were earning. Saved it. Bought “war bonds”. The folks scrimped and saved for those years. When the war was over the housing and auto industries took off. And everything else as well. Baby boom….. It was the people who pulled the economy out of the depression. Not government spending. But you had to be there to see - and feel - it.
The problem is we are not the same people we were in those years. We no longer have the heart to pull ourselves out of this mess. It’s easier to let big government do it. But sorry, this massive spending will not work. Government is not smart when it comes to spending money. (Hell, they don’t even read the spending bills they vote for.) People are, however. Cut taxes and let us fix the economy. No more bailouts - let companies fail when they fail. It makes no sense to reward companies that make horrible decisions. The deserve to go down. If the economy is allowed to work as it’s supposed to, something else will take a failing companies place. That’s how it’s supposed to be. But do we have the guts to do it?
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9:40, the problem is, the American consumer sits on their money during a recession, afraid to spend it. That’s why the government has to temporarily compensate for the decreased investment and consumption.
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The problem with tax cuts is that the politicians can’t dole the money out to their cronies and special interest groups.
The government elite spends money MUCH more wisely than the ignorant lumpen, dontchaknow.
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I all for a bit of pork but it’s getting ridiculous. It’s either going to be big tax increases or huge inflation - there’s no third way. Worse yet would be both at once.
Government spending is exploding, with the Congressional Budget Office projecting $9.3 trillion in deficits over the next 10 years. People know that this spending represents future taxes.
Here is an interesting set of facts. If the government increased the top tax rate from the current rate of 35% to 100% (yes, that’s right 100%), it would only collect an extra $400 billion this year. In other words, confiscating all the income that is currently taxed at 35% would not raise enough revenue to cover any of the annual deficits projected in the next 10 years. There is no way that tax hikes on the rich alone can pay for proposed spending in the current budget.
http://www.forbes.com/2009/04/20/tea-party-taxes-opinions-columnists-ear-marks.html
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2:53am
You get up that early to write something that could have waited until the afternoon?
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8:20, I was writing a paper and took a break. I’d never get up that early for anything.
1:11, you are inadvertently advocating for government spending. The war was all government spending, you just don’t deem it pork. What is pork to one is a necessary improvement to a road to another. It doesn’t really matter how it’s spent as long as it keeps people working.