Tuesday, July 24, 2012

Real Umenployment at 22%?

I found some more economic news today. I really wish these folks would get on my schedule for Economic Monday.

From the Noisy Room comes this report that the real unemployment rate is even higher than we've been led to believe. Most estimates that dare include the size of the workforce put the current figure at around 11%, which is already pretty bad.

Now, a fellow by the name of John Williams says that this figure is low. Really low. It's more like 22%.

They mention the fact that the method for computing the actual number of unemployed Americans changed in 1994, quite possibly for political reasons. We can't have the current administration looking bad, now can we? As we've seen with this administration, they don't hesitate to concoct new phrases to try to make themselves look good like "Jobs, saved or created." This is a new metric that, rather transparently (at least to those of us who can still speak normal English, not Political NewSpeak), attempts to take credit for saving existing jobs as well as creating new ones.

So, if you're one of the millions of Americans like me who has lost your job or your home, how's that new phraseology working for ya'? Not too well, I'm guessing. It sure hasn't done anything for me.

But I digress.

It's painfully clear that we need a change in direction, away from the big-government overregulation that's currently strangling our economy. What we need is a return to the free market. This article over at PJ Media pretty much says it all, "Want Change? Let's Try Truly Free Markets."

For all of the talk about “change!” in this election, the incoming president’s political party, and perhaps the president-elect himself, seems stubbornly resistant to it.

Joseph Schumpeter famously — and admiringly — wrote about the “creative destruction” inherent in the actions of the free market. I refuse to use the word “capitalism” in this context, because it’s really a Marxist term and doesn’t capture the essence of a system in which individuals and corporations freely exchange goods and services without government interference, if indeed it ever did. When so-called “capitalists” who run the finance, real estate, insurance, and now automotive industries come to Washington, hat in hand, for taxpayer dollars, it’s laughably ludicrous to call them supporters of the free market. Moreover, the term “capitalism” doesn’t capture or connote the importance of property rights and the ability to exchange them freely that are at the base of human liberty in the way that the phrase “free market” does.

In Schumpeter’s view — which is supported abundantly by history — as new technological or financial or cultural innovations arise, or as the societal desires and composition change, so change the markets and business models for existing companies. They have a choice of adapting to that change or, if incapable of doing so for either corporate cultural or other reasons, they can die. They can die, that is, if they don’t have courtiers at the royal court. Then, their options are more varied and they don’t require the necessary and painful change to their ways of doing business that might be required to survive in the new circumstances.
As Instapundit says, read the whole thing.

One final note. You don't need a degree in economics to understand what's at the root of our current economic quagmire: We have a government that has become too big. It sticks it's nose into every corner of our lives, even when there is no need to do so. This is because we've allowed lobbyists and their special interests to dominate what was once the domain of the average citizen.

The corruption of political cronyism is also in play today as never before. The federal bailouts of GM and Chrysler are a prime example. Not too long ago, they would have filed for bankruptcy. This would've allowed them to renegotiate their labor contracts with the UAW. But, since organized labor was a big contributor to the Obama campaign, he felt obligated to support this group with taxpayer dollars instead.

He even went so far as to demonize those who would allow the car companies to file as being guilty of "doing nothing," which is more Leftalk for using the system that is in place, more of that "change" shit we've been fed. We lost billions of dollars by sidestepping this process, with little hope of ever getting that money back any time soon.

I just hope the Romney administration understands what must be done, and gets about the daunting task of doing it as quickly as possible.

There's a lot to be undone in Washington. Let's get to it.

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