Tag: economy

Jan 08

Getting A Real Job…

Well, we all had a great time here in London and the surrounding areas, but now it’s time to get back to work.

We’ll be leaving Great Britain a little later tonight and be in Washington DC for a couple of meetings on Monday. That should be fun…

I want you to imagine a bunch of politicians and bureaucrats who just a few weeks ago were being arrogant, threatening, demanding, and in general pricks and assholes now finding themselves in a position where they have to kiss some ass. What they don’t understand is that the ass kissing won’t help them. Not one little bit.

You see, I don’t trust them. Why should I? The entire bunch is just a gathering together of professional liars, and they are so used to the American public believing the lies, they just can’t stop. They are both amazed and angry when someone sees through the lies and questions them. They just don’t get it.

No matter what they say or what they promise, things won’t change. That’s because the outcome of the coming election in November will not change anything. It just doesn’t matter who is in the White House or in the House or in the Senate. The overall picture will stay the same in terms of policy and direction.

Huge deficit spending will go on unchecked. Ridiculous rules and regulations will remain in place and new ones will be added. Fees and taxes that drive businesses out of business and prevent growth and job creation will only increase. Similar taxes and fees will continue to grow for individuals and prevent them from having the money to spend on the things they want and need. More and more people will continue to become increasingly dependent on government and taxpayer support, narrowing the pyramid of how many people are available to support the programs needed to help those in need.

At some point, the whole thing will reach a kind of critical mass and collapse under its own weight. Personally, I think that point is coming in the next five years or so.

Just look at Europe…

There is no longer enough income to support the spending. Many countries can’t even borrow enough money to make up the difference. This creates a vicious cycle where taxes and fees are increased to generate more income, the increases force more businesses to close and fire employees, so the base for the fees and taxes shrinks and income continues to fall. Repeat until the whole thing comes apart like a cheap Kleenex and you’re left with a handful of snot.

The good news for Europe is that they have finally seen the problem and what’s causing it. It remains to be seen if they have the balls to fix it or not. It won’t be easy. I’m not sure I have much faith in them.

The bad news for the United States is that most people don’t even see the problem yet, let alone the solution. I have zero faith that the US will fix things.

In other words, things are going to get much worse before they get better. Just like Europe.

The really good news is that there are places on the planet where things are improving. Places where the government and the people can see what needs to happen in order to avoid the mistakes that Europe and the US have made. And they are working hard to make sure they avoid the traps and actually prosper.

The answer is pretty simple, really. It can be summed up in just one word…

Jobs

There must be an environment where jobs in the private sector can be created, and I mean jobs that pay well, offer good benefits like health insurance, and give people a sense of pride and investment in their work.

When you look at jobs, there are four parties involved, and each has done their fair share to set up the economy to fail. Let’s take a quick look at each group…

Companies have let profits get out of hand. There is nothing wrong with making a profit. In fact, that is why any business exists in the first place. But profits must be kept reasonable. What is a reasonable profit? I’m not really sure, and I doubt that anyone else can pin that figure down either. Could we call it 10%? Maybe 25%? I just don’t know. What I do know is that a profit of 50% or larger is probably too big. But whatever the figure is, when a company places profit too high, everything suffers. There isn’t enough money available to hire more people or to pay more in terms of both salary and benefits.

Governments have pandered to certain businesses and to certain groups of workers. This creates an unlevel playing field that allows some to benefit at the expense of others. This needs to stop now. Additionally, government fees, taxes, and regulations on businesses takes away cash needed to grow, hire people, create new products, and to make a reasonable profit. In a similar way, taxes, fees, and regulations on individuals also takes money away from the workers and forcing them spend only on necessities like food, housing, and clothes. There is little left over for the things they just want. It is these non-necessities that create new businesses and the jobs that go with them.

The workers themselves have contributed by demanding pay and benefits far in excess of what is reasonable for a particular job. Look around you and I promise you will find people being paid more than they are worth for the job they are doing. These costs to a company are passed on to the product the employer is selling, and so the price goes up. In most cases, that leads to lower sales. That means less income. See where I’m going here?

Lastly, we have the society in general. In the US, the push is for everyone to go to college. Why? No, really! Why does everyone need a college degree? If a kid wants to be, for example, a precision machinist, do they need a college degree or do they need a firm vocational education in machine work? And by the way, precision machinists in the US average nearly $20 an hour starting pay. With ten or more years of experience, the average goes up to nearly $35 an hour. Do you know what the two largest groups of workers are? Food service and retail sales. Now please explain to me why a waitress or sales associate at Wal-Mart needs a college degree. And guess what…there are hundreds of thousands of people in these jobs that have been there for 30+ years. They like what they do and they are good at it. There are indeed a good number of jobs where a college education makes some sense. Not many, but a few. In summary, making everyone have a college degree artificially inflates salaries, costs tons of money to run the colleges, and in general is a bad idea. Instead, the US needs career oriented education. This could be formal education, on-the-job training, or a combination of both.

There is one obvious first step for the US…

Get government out of the way of private sector job creation. Doing that would have two immediate effects: First, more people would go to work. Second, government spending would drop like a falcon because the reason for about 60% of all government agencies would cease to exist.

Imagine that…

Income to the government would increase because of a broader tax base. Spending on frivolous agencies would cease.

The government would have more money to do the things that are needed.

 

Permanent link to this article: http://melodeeaaron.com/blog/2012/01/08/getting-a-real-job/