Feeds:
Posts
Comments

Posts Tagged ‘jobs’


Recent pronouncements of President Obama and a three year trend of his administration have crystallized just where he stands on economics and job creation.

First, look at the three year history of his administration.  The never-ending onslaught of regulation on business and banking under the guise of protecting the consumer and the environment have used a regulatory and lending blanket to smother the small business job generator.  Small business has traditionally generated over 70% of the nation’s jobs.  Now small business is both being smothered by regulation and a dearth of lending availability from the nation’s banks.  The latter due to new banking regulations and Federal Reserve created opportunities to earn, outside of lending, by using the spread between borrowing from the Federal Reserve and then buying Treasuries.

The EPA is single handily ripping the life out of the coal industry, and its jobs.  Oil drilling has been seriously curtailed on federal land and off shore, killing high paying jobs.  Even fracking for natural gas and oil from shale is under attack by the EPA.  Have you wondered why recent reports of EPA action indicate that the EPA has armed SWAT teams and why EPA agents now are armed?  If this is true, what is next – armed truant officers and meter readers?

Now let’s look at two of the tenets of socialism.  In socialism:

  • the government controls big business and the banking industry
  • jobs come from big business with small business being generally non-existent

President Obama has recently provided additional insight to what he believes to be job creation.  His statement that the private sector is doing just fine was ludicrous but more so indicative of where he wants to take this country.  His new plan is his old plan.  He wants to create jobs by creating more non-federal government, but local government jobs, and we already know that federal jobs are up as well. CNN-Money reports: “…The number of federal employees grew by 123,000, or 6.2%, under President Obama, according to the White House’s Office of Management and Budget…”

To be fair and the article points this out that this is just a continuation of President Bush’s job growth in the federal government. I say, more of what is not good is bad.  A word about President Bush – he expanded government, yes, and this was the start of our move to bigger government.  This does not mean that it is good that President Obama doubled down on what was not a good trend in the first place.  My mother would have said: “Two wrongs don’t make a right”.

The article also points out a greater number of regulations were introduced during the term of Bush than Obama.  Don’t go by the number, but by the severity and impact.  The Obama administration is masterful at private sector killing regulation and the regulations that place big business under the thumb of the federal government – Affordable Health Care is one and Dodd Frank is another.  Each of these laws authorizes the bureaucrats of Obama’s administration to write extensive, binding, impactful regulations that destroy small business and gives the federal government unprecedented power over big business and the banks – key tenets of socialism.

Back to Mr. Obama’s pronouncements about creating jobs.  Rather than unleash the private sector and small business to grow and truly create economically productive jobs, he is pushing for a repeat of the failed $800+ Billion stimulus which was going to create police, fire, and teaching jobs, as well as apparently non-existent shovel ready jobs, by doubling down and borrowing more money to pour into local government, government sector unions, and economically unproductive jobs.  Remember the reason why police, fire, and teachers have been laid off is the inability of local government to pay the benefits and pensions resulting from these government sector union jobs.  More socialism!

Apparently Mr. Obama is incapable of or has no desire to foster private sector jobs, even private sector union jobs, and he just has to feed the government sector unions with more stimuli.  His solution to unemployment and the stagnant economic growth is to move into the only direction he knows and believes in; and that is to grow government, foster government sector unions, minimize or eliminate small business, have the banks do the bidding for the federal government, and ultimately raise taxes.  His desired action requires more taxes and more taxes shrink economies.

I can only suggest that anyone who disagrees with me look up how failed socialist states operated.  The plan Obama is using is the failed plan of the past, worldwide.  There has not been one socialist economy in history that has improved and sustained the quality of life and standard of living of the populace.  Government jobs, while a necessary pill which must be taken in great moderation, are not economically viable contributors to the Gross Domestic Product (GDP) and the standard of living of any economy – they require more taxes and again taxes shrink economies.  Yet he steadfastly refuses to unleash the 70% job creator – small business.

 

Advertisements

Read Full Post »


Updated: March 23, 2010

The two most important issues facing this nation are now very clear.  These two issues have now risen past all other issues previously highlighted in this blog.  The first big issue is:

We now have a House of Representatives where the progressives hold just about all committee chairmanships; A Senate with progressives from both parties holding key committee positions; we have an extreme progressive as Speaker of the House; an extreme progressive as Senate Majority Leader; and an extreme progressive, near socialist, as President of the United States.  I use the term progressive, because I believe the progressives have taken over the Democratic Party – it is certainly not the party of John F. Kennedy and not the party that my mother and father admired.  To digress a bit, just take a good look at the advisors with which our President surrounds himself.  These are for the most part radical revolutionaries with the pedigrees to match.

Their agenda is simple, provide as much social legislation without regard to the debt and to our ability to pay the bill.  This is the first big issue facing America.  The means used to pass the Patient Protection and Affordable Care Act demonstrated that this group of progressives believes that the end, that they seek, justifies the means with which they achieve the end.

They stopped at nothing in their effort to push a piece of legislation by going outside the rules of each House of Congress, by buying votes from legislators with our money, by a complete obfuscation of the true facts about the bill when informing or rather ill informing the public.  They wrote provisions into the bill to force the Congressional Budget Office (CBO) to provide a dollar amount that was on the surface revenue neutral, even a debt reducer, when it is neither.  They did this by double counting supposed savings in a number of areas, with an egregious mis-count on Medicare savings to the tune of $563 Billion.

They sold this bill to the public as a bill to insure thirty-two million uninsured Americans, yet they do not cover these Americans for years.  In fact, the thirty two-million includes illegal aliens, but we were told that no illegal aliens would be covered.  What we were not told was that the next bill up in Congress, and they have started to work on this, is to provide amnesty for these illegal aliens, so they will be covered as well.

In this bill the Democrats have given the Secretary of Health and Human Services the authority and the marching orders 1,200 times to write her own rules for all sorts of health care, from payments to procedures, to insurance, to who is covered, to rationing, since thirty-two million newly insured will need to be covered by the same number of doctors who now practice – rationing will be necessary.  The Secretary has now been given the ability to write law without Congressional oversight. Remember the Secretary is Kathleen Sibelius, who refused to take action against “Tiller the Baby Killer” when she was governor, because he contributed heavily to her campaign.  “Tiller The Baby Killer” was one of two or three doctors in Kansas who would routinely abort late-term babies for frivolous reasons, before he was assassinated – these were babies who could have lived outside the womb.

This bill is actually a violation of Roe v. Wade – the Supreme Court decision that protected a women’s right to do with her body as she sees fit.  This also applies to men who wish to do with their body as they see fit.  Should men or women choose to not have health insurance and not to seek regular medical care, they have that right under Roe v. Wade. Read: Roe v. Wade to the Rescue: right to privacy or health care mandates.

One last item about this bill, is that you can search it high and low and you will find nothing in it that attempts to control the cost of health care.  Why?  Well, this bill is only intended to drive the health insurance companies out of business, leading to single payer universal health care, just as found in Canada and Great Britain.   Until this happens, the Secretary of Health and Human Services is in control of the insurance companies.

The second big issue facing this nation is even more dangerous to us than health insurance reform:

The flagrant disregard for our Constitution by Congressional leaders and our President should be a warning to all.  Speaker Pelosi actually laughed at a reporter who seriously asked if what she was proposing was Constitutional.  At the minimum they have flouted the spirit of the Constitution and at the most egregious they have simply ignored it.  The President is on record with his disdain for the Constitution, in that it does not offer mandates of what the government must do for its citizens.

It is clear that he and his cadre wish to rewrite our storied Constitution that currently prohibits our federal government from taking over the rights of people.  This document prohibits the federal government from diminishing the states and Congress to roles as bit players in the governing of this country.  It is clear that the current leadership in Washington feels inhibited by this Constitution – they cannot ignore the whole thing.

This progressive cadre wants to rewrite the Constitution and the way to do that is to create a national economic emergency the size of which has never been imagined.  They will spend us into oblivion until our economy is broken and our free markets are teetering on collapse.  Then and only then, to solve a national emergency, they will offer a solution to the problem that includes an even bigger federal government driven by an even bigger centralized executive branch.  They will attempt to use the tragic events of a broken economy to rouse public interest to rewrite the Constitution.

Read an indepth look at how the progressives have attempted to marginalize and discard our Constitution in a bookblog dedicated to looking at what is wrong, why it is wrong, and what we need to do to fix the problem at U.S. Constitution – “Sine Die”.

Read Full Post »


The latest argument being made by some who do not wish to drill for oil domestically both offshore and onshore, is that there are simply not enough ocean going drilling vessels to meet the need.

The U.S. shipbuilding industry, once robust and a world leader, is now nearly gone. A combination of international cost economics and union rules made this industry shrivel up. If it was not for the few military ships being built and refitted, it would have blown away. This is a JOBS opportunity!

Our energy circumstances are calling for drilling both onshore and offshore and a need for ocean going drilling ships. This is a grand opportunity to rebuild the U.S. Shipbuilding industry and create good paying career oriented jobs in the process. These circumstances have placed this opportunity right on our doorstep. Now the question must be asked. What other job opportunities will arise from the search for domestic oil? How many related jobs will be in need of U.S. workers to fill them? The entire supply chain for the drillers and the ship builders, plus the entire delivery chain for both will be, itself, a massive mostly self financed jobs program offering the type of jobs that are the backbone of the American middle class. These jobs would reverberate through the Midwest, especially Ohio, and the Katrina ravaged Gulf Coast. These jobs would require skills to be acquired through training. How about a jobs training program for these and related industries to make these jobs happen? Training means trainers and yet more skilled jobs.

Read Full Post »


Sounds confusing, doesn’t it. The cry around this country to “get those dastardly corporations – they are the cause of all our troubles” is so misplaced that it is almost like saying don’t put prisoners in prisons, because prisons are unsafe because there are too many dangerous people in prison.

Have I now cleared all this up? Okay it is simple, even if Senators Obama (now President) and (now Secretary of State) Clinton appear to not get it. Corporations factor in the income tax rate into their cost of sales and thus the price they set on what you buy at the point of sale. So, go ahead and tax the living day lights out of these corporations, they just collect their income tax for the government from you. There is one hiccup with this plan. These corporations are unable to incorporate their income tax into the price on sales overseas or in Canada and Mexico.

Senators Obama (now President) and (now Secretary) Clinton, please pay attention here as this is important and you act like you have never heard this before. When you tax a corporation and it cannot pass on that tax it either cannot survive internationally or it adapts by closing plants in the United States and opening these plants in another country. Are you still listening? When they do this, they create jobs in other nations and terminate jobs in the United States. This is called free enterprise. We could try to regulate corporations and force them to keep the jobs in the United States, but then they will not make any money and the investment capital will move to a company in another country and not here. It is like squeezing a balloon. Squeeze one end and it gets bigger on the other end – squeeze too hard and it breaks.

Our tax code and the fact that we tax our corporations at the second highest rate internationally may have something to do with out trade deficits and the loss of good paying jobs in this country. So yes, when we tax a corporation they bill us for the tax through domestic sales or sell us merchandise made in another country where the bulk of the profit is taxed at the other country’s favorable rate and the taxes go to the other country.

Senator (now President) Obama has a socialist solution for this conundrum. Instead of lowering taxes on domestic corporations so they can manufacture in the United States and create good paying jobs. These are jobs that make you more financially viable, jobs that make our economy healthier, and jobs that help us export to other nations. Senator Obama’s solution is to support the Patriot Employer Act. This act is right out of the socialist play book – we all know that the socialist economic system is failing all over the world. It is the second worst economic system, on how people benefit, only when compared to communism.

The Wall Street Journal quotes Peter Merrill whom they refer to as “…an international tax expert at PriceWaterhouseCoopers…” as saying “…Apparently Mr. Obama believes that by making U.S. Companies less profitable and less competitive world-wide, they will somehow be able to create more jobs in America.” http://online.wsj.com/article_email/SB120407121574294919-lMyQjAxMDI4MDI0ODAyNzgxWj.html

Honestly, they must have taught international economics at either Columbia or Harvard when Senator (now President) Obama attended. If he knows better and is sending us down the wrong path just to get elected, then he does not deserve to be President. If he does not know better, then he does not deserve to be President. The same should apply to Senator (now Secretary) Clinton. The solution, Senators Obama and Clinton, is to help these corporations become as competitive as we possibly can and then turn them loose on the world. This will create the right kind of jobs for this nation – we will not have to settle for jobs where you must learn the phrase – Do you want fries with that?

Senator (now President) Obama, drop your support of the misnamed Patriot Employment Act which is a form of reverse protectionism – it protects the world from us – and lower or eliminate corporate taxes. Yes, we all will personally pay more income tax which will be offset by lower prices for goods, since the tax will no longer be included in the price. This will stimulate domestic production of all kinds of goods and improve our standard of living by allowing us to hold better jobs. Aren’t you and Senator (now Secretary) Clinton about jobs?

Read Full Post »


Updated December 2, 2009

We now have four most important issues facing America today.  The House of Representatives has passed the “Cap and Tax” – okay the Cap and Trade bill.  It is waiting for Senate approval.  This bill will cost each family in America in the neighborhood of $1,8000 per year in home energy costs, plus an untold amount in auto gas, and an even more untold and expected hefty increase in all goods produced, grown, or imported and trucked in this country.  These goods will be taxed at every step of the way.  This includes food which will also be subject to the Cap and Tax.  This Cap and Trade bill will raise the price of everything we consume.  While this may seem necessary to save the planet from CO2, we now know that the CO2 facts are not facts at all.  We now know that key scientists have been cooking the books, distorting data, hiding bad results, and destroying the raw data, which could prove their assertions wrong.  Read: “Email reveal that climate change is not settled science”  and “Impact of Climate Change Bad Data.”

If this hoax is not bad enough, our President still intends to travel to Copenhagen, Denmark to participate in the United Nations Climate Change conference.  The UN’s Intergovernmental Panel on Climate Change (IPCC) is behind this push for CO2 restriction and gets its information from the scientists who have been cooking the books. The IPCC is seeking draconian cuts in out CO2 emissions based on this faulty climate change data.  These cuts will cost this country dearly, especially during a recession, without solid science behind them.  The Australian Senate just dumped their climate trade bill.

Updated May 27, 2009

We now have three most important issues facing America today.  We are faced with a Congress and Executive Branch operating as if the Constitution does not exist.  The Federal Government is out of control.  It regularly, during the Bush administration and now to a faster extent the Obama administration, is crafting legislation that is not within the assigned powers of the federal government under our Constitution.  The U.S. Government has only 18 enumerated powers, plus a few amendments providing additional powers.  All other powers are reserved for the states. None of these 18 powers grants the federal government the authority to do what is doing now – starting with “no child left behind” and approaching Cap and Trade and National Healthcare.  Read more of the powers granted to the federal government at: Today’s Federal Government is Unconstitutional! We must push the states to assert their rights and Constitutional superiority over the federal government.

Updated February 9, 2009

Deep recession, job loss, and retirement savings loss are the current drivers of the challenges to the economy right now.  Our new President is receiving a great deal of good will driven by populism to move our country out of the current recession.  The far left has an agenda to move this country into socialism and is also a weighty provider of support for him, assisted by the media.  The current pork laden, earmarks on steroids bill being discussed in Congress labeled an economic stimulus bill by the far left is an example of the left trying to sneak their agenda through, at a time when we desperately need a  tightly targeted stimulus and jobs bill, only.  President Obama has now put his shoulder behind this non-stimulus spending behemoth of a bill – it appears he may be part of this far left agenda.  This non-stimulus behemoth filled with social engineering might very well be the Trojan Horse used by the far left to move this country into socialism.  Our far left leadership appears to be riding the wave of populism to establish this nation as a socialist nation.

What do you think of our far left leaders like Pelosi and Reid, who are using this very serious recession with people hurting in every corner of this nation to substitute a pure spending bill in the name of an emergency economic stimulus package?  These people are intent on capitalizing on the national wave of populism to change the basic culture and fabric of this nation.  Riding the populist wave is a tool used since democratic governments were created.  It uses the populace’s desire for economic change to sneak in radical change that is not in the best interests of the mainstream populace.  Those seeking culture change sneak in their limited appeal power grabbing agenda in the guise of making changes that will help all people.  Take a good look at the Pelosi and Reid agenda and you will find item after item not intended to stimulate the economy, rather they are intended to build a nanny state by growing government and keeping people dependent on government.  An historic example of this sneak attack is Hitler’s Nazi Party use of populism – then nationalism – to install Adolph Hitler and the Nazi Party, who then went on to make sweeping changes that were not in the best interest of the populace.  A recent example is the action of Hugo Chavez and his socialist movement.  He has used the populist movement in his country to deliver change that his countrymen did not suspect or want.  We must be ever vigilant of those who will use a crisis to make masked changes that are not in the best interest of the main stream population.  Vladimir Putin has successfully used a wave of populism in Russia to deliver sweeping changes to limit freedom and the future political choices of the main stream population.

Why is populism so popular today? What are the real challenges facing President Obama?  What kind of leader does he need to be?  Let’s start with populism. People are unhappy with their declining standard of living. Food, fuel, medical care, and schooling cost more each day. Jobs are tenuous. These are the basics to a happy and successful life. The gap between the “have” and the “have-nots” is widening. The middle class is disappearing but you would not know it because we keep redefining it. The unemployment rate after hovering for years pretty close to what has in the past been defined as virtual full employment has slipped and we are in an unemployment rate upward spiral.

The tsunami of problems we face as a country today is knee buckling.

  • A goodly portion of the world seeks our demise. An entire movement of millions wants us all dead.
  • Hostile nations can, overnight, be in control of more than half the world’s oil exports.
  • We consume more than half the world’s oil exports, while making unfriendly nations richer and more powerful.
  • Fierce worldwide trade competition has brought our trade deficit to a little more than $600 Billion annually.
  • For the long term, we can no longer compete on the world stage. Plentiful good paying blue collar middle class jobs are gone. We no longer make much of anything in this country – it is nearly impossible to buy American.
  • We have opened our borders – at least our government has – to just about anyone who has the temerity to sneak into our country. This uncontrolled illegal immigration has created even more economic and social pressure on state and local governments, by increasing the cost of schools, hospitals, police, fire, and all sorts of social services.
  • Home values are vaporizing; millions are underwater in their home mortgages trapped in their homes as if they had gone to debtor’s prison.

President Obama must tackle two problems that are not mutually exclusive. He will have to change our energy culture. We must shake our oil addiction. This effort could consume an entire Presidential term of office. Multiple millions of Americans use oil for transportation, to heat their homes, and work in oil heated places of business.  Oil is our Achilles Heel! Each of our Presidents since Richard Nixon, Republican and Democrat, has know this to be our Achilles Heel and have not addressed the matter directly, thanks to the U.S. Oil interests and environmentalists. They have instead relied on international leverage of force and financial persuasion. This prescription is proving to be disastrous; as we are already experiencing serious side effects. The use of nuclear energy, using the newest technology with very low waste reactors, must become a national priority – it is the fastest way for us to replace oil imports with an inexpensive alternative.

Mr. Obama will also have to restructure our ability to effectively trade in the world. We have neglected this for nearly twenty years. No, not more agreements. The President must steer a course to rebuild our ability to compete in the world trade market. We must be able to manufacture and sell to the world. We must remove all obstacles to low cost domestic production of goods and services.  He must seek low cost energy so these businesses can compete on the world stage.  He must ensure that these businesses have minimal taxation so they can effectively compete with world competitors.   Only then will we be able to add quality good paying blue collar middle class jobs and start this country back on its way to a sound economic footing. Get back to a sound economic footing and the desires of the populists will be achieved.

We need a leader who recognizes these two critical issues, who is passionate about these two issues, who can cut through the entrenched resistance and the far left agenda to effect positive long term energy and trade change, and who can unflinchingly stand his or her ground. He will also need a Congress that understands that our survival as a great nation depends on these changes happening sooner rather than later.  We do not need a Congress interested in only furthering the power of their party.  We do need a Congress that will not take advantage of us when we are down, and will be a driving force to drive our economy upward and forward.   We need a Congress that is not beholden to the far left, but is beholden to main stream and Main Street America.

Why is a populist groundswell dangerous?  Left unchecked populism can and will bring change, out of control change, to our way of life.  Our nation was formed as a republic.  A republic was chosen because it is the form of government that gives us the most individual freedom.  If you thought a democracy brought the most freedom to the individual you might view a YouTube video called The American Form of Government.  You will see that change through a ground swell of populism – pure democracy and majority rule takes our freedom away.  Change brought about by populism is a volatile element to the free people of this earth.

The following is the original posting of February 2008.

Why is populism so popular today? What are the real challenges facing the next President? What kind of leader do we need?

Let’s start with populism. People are unhappy with the ever lowering of their standard of living. Food, fuel, medical care, and schooling cost more each day. These are the basics to a happy and successful life. The gap between the have and the have-nots is widening. The middle class is disappearing but you would not know it because we keep redefining it. The unemployment rate is still pretty close to what has in the past been defined as virtual full employment, yet we are slipping.

  • The tsunami of problems we face as a country today is knee buckling.
  • A goodly portion of the world seeks our demise. An entire movement of millions wants us all dead.
  • Hostile nations can, overnight, be in control of more than half the world’s oil exports.
  • We consume more than half the world’s oil exports, while making unfriendly nations richer and more powerful.
  • Fierce worldwide trade competition has brought about a $200 billion trade deficit. We can no longer compete on the world stage. Plentiful good paying blue collar middle-class jobs are gone. We no longer make much of anything in this country.
  • We have opened our borders – at least our government has – to just about anyone who has the temerity to sneak into our country. This uncontrolled illegal immigration has created even more pressure on state and local governments, by increasing the cost of schools, hospitals, police, fire, and all sorts of social services.

The next President must tackle two problems that are not mutually exclusive. He or she will have to change our energy culture. We must shake our oil addiction. This effort could consume an entire Presidential term of office. Multiple millions of Americans use oil for transportation, to heat their homes, and work in oil heated places of business.

Oil is our Achilles Heel! Each of our Presidents since Richard Nixon, Republican and Democrat, have know this to be our Achilles Heel and have not addressed the matter directly, thanks to the U.S. Oil interests and environmentalists. They have instead relied on international leverage of force and financial persuasion. This prescription is proving to be disastrous; as we are already experiencing serious side effects. The use of nuclear energy, using the newest technology with very low waste reactors, must become a national priority – it is the fastest way for us to replace oil imports with an inexpensive alternative.

The next President will also have to restructure our ability to effectively trade in the world. We have neglected this for nearly twenty years. No, not more agreements. This President must rebuild our ability to compete in the world trade market. We must be able to manufacture and sell to the world. We must remove all obstacles to low cost domestic production of goods and services, including low cost energy. Only then will we be able to add quality good paying blue collar middle class jobs and start this country back on its way to a sound economic footing. Get back to a sound economic footing and the desires of the populists will be achieved.

We need a leader who recognizes these two critical issues, who is passionate about these two issues, who can cut through the entrenched resistance to effect energy and trade change, and who can unflinchingly stand his or her ground. He or she will also need a Congress that understands that our survival as a great nation depends on these changes happening sooner rather than later.

Read Full Post »


In economics books it is called Comparative Advantage. It is the underlying key to successful trade among nations. In non-economist terms, it is what can I offer that the other guy can’t that will give me an advantage in trading so I come out on top.

When the United States was very young, we had unbelievable amounts of natural resources. As we approached the twentieth century we had a powerful work force achieved through the immigration of people looking for a better opportunity. These people were both adventurous and driven to succeed – they made a productive work force. Oh yes! we still had abundant natural resources. In the second half of the twentieth century, after the two world wars, Asia and Europe were devastated and without infrastructure, and they were in need of all things manufactured as they were rebuilding. The comparative advantage of the United States was its gargantuan manufacturing infrastructure resulting from the build up to produce for World War II, and the many technical achievements gleaned from the war arsenal. We had a customer – the world – ready to consume any and all that we could produce. In effect we not only had a comparative advantage, but also an absolute advantage – we could only prosper – we could literally phone it in. It was all about us!

By the close of the twentieth century both Asia and Europe, with the exception of the iron curtain countries and the Republic of China, had rebuilt their infrastructure, and in many cases with more up to date and productive manufacturing facilities than we had. The United States had fewer desirable / usable natural resources. Our coal reserves became unpopular and our desire to not spoil our planet kept us from fully developing our oil reserves. In the mean time, oil was becoming the key natural resource in the world for the later part of the twentieth century and the early part of the twenty first century.

In the second half of the twentieth century, we became oblivious to the world – remember it was all about us! We paid our people ever increasing wages in manufacturing, added many unproductive work rules, and taxed our companies to the point that all three events took away our comparative world trade advantage in manufacturing. We were now at a trade disadvantage – yet our appetite to consume was still feverish. During this period, it became more advantageous for our manufacturing companies to move manufacturing overseas. If they had not done so, they would not have been able to compete on the world stage and be profitable. During this period, one bright spot in our comparative advantage was our strength in technology and highly educated and well trained engineers. Our use of technology gave us a comparative advantage in productivity. We continued to utilize our comparative advantage in the trade of technology – we thought it up and it was manufactured overseas. Over the last quarter of the twentieth century and the beginning of the twenty first century, Asia caught up, only with a twist – same or better engineering with lower wages – the comparative advantage shifted in their favor. We also allowed our schools to lose their leadership in delivering a strong education from K through 12.

Today, what do we offer: restrained under utilized resources, a broken education system, uncompetitive costs on a world scale due to high wages on the remaining manufacturing jobs (auto industry), a declining infrastructure, comparatively high taxes on companies attempting world trade, and a voracious appetite to consume manufactured goods and oil from overseas? Yet our political leadership continues along as if we remained the pre-eminent holders of all things comparative trade. Our free trade agreements are good, yet we entered the trade arena with a handicap – we have no comparative advantage, so they are NOT good for us at this time. Protectionism will not work, because the nations of world can get along trading among themselves – they no longer need us.

What do we need to do?

  • Business: stop taxing our domestic businesses engaged in manufacturing, give them a financial trade advantage as they will still be paying higher wages for manufacturing workers than their world competition; remove the health insurance financial burden from business and move it to a national health insurance system; move to a consumption tax and stop taxing the businesses that need to trade to grow so they can build and offer more good paying jobs – we need to put our domestic businesses on a level playing field with the rest of the world.
  • Children: target our children by giving them all a top flight education and by challenging them with a tougher curriculum, and longer school years just as advantaged world trading nations do.
  • Energy: drill for and refine our untouched domestic oil reserves in the short term; utilize nuclear, clean coal, and solar in the mid-term; develop wind, geo-thermal, advanced solar, tidal and hydrogen fuel in the long term. We need to lower the cost to produce and transport.

If we don’t rebuild our lost comparative advantage we will never hold a free trade advantage, we will continue to become a nation of past successes and a second tier nation at that. Remember it is a world economy now and the competition is fierce.

Read Full Post »

%d bloggers like this: