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gunnut
10 Jun 10,, 23:33
Obama stifling recovery, jobs growth

By GARY JASON
The Cal State Fullerton instinstructor is a contributing editor for Liberty magazine

President Barack Obama has pursued what can fairly be called a neosocialist agenda. He has nationalized the auto and student loan industries. He has dramatically increased regulations. He has ceaselessly bashed various industries, from doctors to insurance companies to banks (omitting lawyers, however). He has pushed an environmentalist agenda, especially cap-and-trade.

Then there is the spending. Obama has passed enormous new entitlement and stimulus bills. He has increased spending explosively, with our national debt hitting $13 trillion. In his 500 days in office, he has added $2.4 trillion in new debt, which is $5 billion for every day of his reign. This is triple the rate of George W. Bush, who was rightly viewed as a big spender.

This spending has taken its toll. In particular, it has dampened down the recovery from the recession, which ended about this time last year. The most-recent monthly jobs report bears this out. The numbers were disappointing, to say the least. The overall (i.e., net) jobs growth was 431,000, and the unemployment rate dropped from 9.9 percent to 9.7 percent.

This was alarming because to begin with, of the 431,000 new jobs created in May, 95 percent of them 411,000 were temporary census workers. In the private sector, a pathetic 41,000 new jobs were created, down from an unimpressive 218,000 the month before. And the drop in the rate of unemployment reflected 322,000 people who gave up looking for work.

Moreover, the number of people out of work for six months or longer reached a new high of 6.76 million. That is 46 percent of the unemployed, also a new high.

The fact that 95 percent of the new jobs created were census workers was disturbing enough, because census jobs drop off quickly. Even more disturbing is the fact that the number of census workers being hired may be artificially high. A whistleblower with the pseudonym "Maria" reported that the Census Bureau is hiring people, training them for a couple of weeks, laying them off, and then rehiring them, with each rehire being counted as a new hire. If this is true, there is no telling how many net new hires there really are.

Add to this the fact that the Census Bureau has admitted to the Office of the Inspector General that it deliberately hired more workers than needed a practice it calls "front-loading" which it justifies as a "cost-cutting" measure. Whether this makes any sense I leave for the reader to determine, but clearly, front-loading makes the figure of census new hires a misleading one, since it is deliberately inflated by redundant hires.

Obviously, such factors as the new costs that small businesses face under Obamacare and the hike in the minimum wage is deterring hiring. You can see this in the increase in hours worked: the average work week rose from 34.1 hours in April to 34.2 in May. Companies, rather than hiring new workers, are giving full-time workers overtime and part-time workers more hours.

There were two perfectly predictable responses to this dismal report. First, the econ illiterate President Obama high-fived himself, exulting, "This report is a sign that our economy is getting stronger by the day."

Second, the stock market tanked on the news, the Dow dropping 323 points in one day, more than 3 percent of its total value. The Nasdaq and S&P 500 also lost more than 3 percent of their values, and the Russell 2000 lost 5 percent. Not exactly a high-five.

Obama's neosocialist policies are flattening out the economic expansion we should be experiencing at this point in the business cycle. And they raise the specter of a possible double-dip recession, when the massive tax hikes Obama has promised kick in starting in January. If the nation undergoes another recession that quickly, the effects would be disastrous.


Obama stifling recovery, jobs growth | new, percent, workers - Opinion - The Orange County Register (http://www.ocregister.com/opinion/new-252669-percent-workers.html)

bigross86
10 Jun 10,, 23:43
How is it that people were willing to impeach Clinton over a blow job but are letting this schmuck remain in office?

gunnut
10 Jun 10,, 23:54
How is it that people were willing to impeach Clinton over a blow job but are letting this schmuck remain in office?

Republicans were in congress when Billy was getting blown.

Democrats are in congress when Obama is lying.

Actually Clinton wasn't impeached for getting a blow job. He was impeached for lying under oath.

Nothing Obama is doing right now is illegal. It's just very unethical.

bigross86
10 Jun 10,, 23:56
Oh well. I guess we'll have to settle for him (probably, most likely and hopefully) being a one term president

highsea
10 Jun 10,, 23:58
Businesses are competing with the state unemployment offices for workers. If I hire a shop helper at $18/hr, his take-home is about $550/week. That's maybe $40 or $50 more than what he gets from unemployment if he was working for the same wage before.

So if he goes to work, he makes $1/hour more than he makes for not working. Who's going to take that deal?

Companies are starting to put notices in their job listings "currently unemployed will not be considered".

antimony
11 Jun 10,, 00:44
Businesses are competing with the state unemployment offices for workers. If I hire a shop helper at $18/hr, his take-home is about $550/week. That's maybe $40 or $50 more than what he gets from unemployment if he was working for the same wage before.

So if he goes to work, he makes $1/hour more than he makes for not working. Who's going to take that deal?


All that sounds really odd...

The WA minimum wage is around $7-$8 and as per your statements, unemployment benefits come to $17.

Freaky:eek::eek::eek:

dalem
11 Jun 10,, 01:04
How is it that people were willing to impeach Clinton over a blow job but are letting this schmuck remain in office?

President Obama hasn't done anything illegal, he's just an incompetent, arrogant, ignorant jerk. Can't impeach somebody for that.

-dale

zraver
11 Jun 10,, 01:23
All that sounds really odd...

The WA minimum wage is around $7-$8 and as per your statements, unemployment benefits come to $17.

Freaky:eek::eek::eek:

The amount of unemployment payments is based on your previous work. If you made good money, you'll get decent money and can turn down any job that doesn't pay good money. This works as an anchor to keep once productive people and the tax revenue they generated out of the system. If Unemployment paid less and had diminishing returns you'd see a bigger scramble for a job. Although that would come with its own problem of deflationary pressure on wages.

ZekeJones
11 Jun 10,, 01:24
President Obama hasn't done anything illegal, he's just an incompetent, arrogant, ignorant jerk. Can't impeach somebody for that.

-dale

I thought those were the traits of all presidents.

highsea
11 Jun 10,, 01:28
All that sounds really odd...

The WA minimum wage is around $7-$8 and as per your statements, unemployment benefits come to $17.

Freaky:eek::eek::eek:I don't hire minimum wage workers. My lowest point is the $18 I mentioned. So someone grossing $720 will take home about $550 give or take, depends on his deductions.

Unemployment is based on gross wage the prior 5 quarters. Someone who grossed $720/week will get about $500 on unemployment in Oregon. Even if he's a Washington resident, he will get the same since his job was in Oregon.

The state of Washington pays the employee, and Oregon reimburses Washington. Then Oregon gets it back from me.

My current rate is 3.9% of gross wages to the State for UI. It gets adjusted every year based on how much the State has paid out the previous year, and how many claims were filed against me.

I have had no significant claims against me, but the rate has gone from 1.6% 3 years ago, to what it is now. That's mainly a reflection of the amount of money Oregon has paid out in the last 2 years.

gunnut
11 Jun 10,, 01:49
California's unemployment payment is up to $475 per week. This is determined by the highest earning quarter over the past year. So if I worked only half a year over the last year, I get more in unemployment than someone who made 3/4 of my hourly wage, but worked the entire year.

$475 per week comes out to be $11.875 per hour for a full time job (40 hours). What is my motivation to take a job if it paid less than that?

Why should I work 20 hours a week for $23.75/hr, if I can sit at home, watch TV, and relax, for the same amount?

Let's extend unemployment check indefinitely to help folks get by the current tough economic condition. :rolleyes:

Roosveltrepub
11 Jun 10,, 12:02
California's unemployment payment is up to $475 per week. This is determined by the highest earning quarter over the past year. So if I worked only half a year over the last year, I get more in unemployment than someone who made 3/4 of my hourly wage, but worked the entire year.

$475 per week comes out to be $11.875 per hour for a full time job (40 hours). What is my motivation to take a job if it paid less than that?

Why should I work 20 hours a week for $23.75/hr, if I can sit at home, watch TV, and relax, for the same amount?

Let's extend unemployment check indefinitely to help folks get by the current tough economic condition. :rolleyes:

LOLOLOLOLOLOL Man do you know how much less 11.87 an hr is than your average salary in CA? I guess there is no reason to get down on Obama about the economy since everyone is unemployed by choice right? Is unemployment in CA indefinite?

gunnut
14 Jun 10,, 21:13
LOLOLOLOLOLOL Man do you know how much less 11.87 an hr is than your average salary in CA? I guess there is no reason to get down on Obama about the economy since everyone is unemployed by choice right? Is unemployment in CA indefinite?

It depends on many factors. CA is very unfriendly toward businesses. You can see that by our official unemployment rate of close to 13% compared to the national rate of 9.7%

Further more, getting $11.87 per hour for 40 hours a week while doing nothing is better for some people than working 20 hours for $23.50 a week. The actual pay out of free money is higher than the equivalent in wages because there's minimal effort spent (don't need to work). Would you dig ditches for $10/hr or do whatever you want for $5/hr?

Roosveltrepub
14 Jun 10,, 22:45
I couldnt dig ditches for a living. I imagine quite a few people with health ptoblems also couldnt do all those landscaping jobs. I do have a decent skillset though and have never been unemployed beyond a couple of weeks. Unemployment has no benefits.

JCT
15 Jun 10,, 17:43
Unemployment has no benefits.

Well, you don't have to fight SoCal traffic every day, nor use up gas on your daily commute. You can watch the kids and not pay for that super super expensive day care. And you can catch up on all those recorded shows on your DVR.

That being said, I'm glad that I'm employed.

JAD_333
15 Jun 10,, 18:53
What is my motivation to take a job if it paid less than that?

Why should I work 20 hours a week for $23.75/hr, if I can sit at home, watch TV, and relax, for the same amount?

Let's extend unemployment check indefinitely to help folks get by the current tough economic condition. :rolleyes:

Hold on a second. You're implying that cutting or terminating unemployment benefits will improve employment numbers. How does that work? There is no surplus of jobs around, and the jobs that do come up are filled quickly.

I'd discount all this anecdotal stuff about the unemployed sitting around all day watching TV while they collect big benefits. For the most part they're are out there looking for jobs; they know the benefits won't last forever and they don't want to get caught short. The problem is there are too few jobs, not too many lazy people.

gunnut
15 Jun 10,, 18:55
Unemployment has no benefits.

What do you call that "unemployment benefit" check that people get from the government?

Wait...it's an "entitlement." It's your money for not working.

JAD_333
15 Jun 10,, 19:09
Obama stifling recovery, jobs growth | new, percent, workers - Opinion - The Orange County Register (http://www.ocregister.com/opinion/new-252669-percent-workers.html)

I am no Obama fan, but this article is the usual slanted gibberish that does absolutely nothing to throw light on what needs to be done in lieu of what Obama is doing.

What is the alternative? Let the economy tank? Maybe that is what the author prefers. But we'll never know, as he didn't offer any alternate solutions to those Obama's economists have come up with.

And perfect operation of the levers of the economy to make a seamless, painless recovery, who has ever accomplished that?

gunnut
15 Jun 10,, 19:12
Hold on a second. You're implying that cutting or terminating unemployment benefits will improve employment numbers. How does that work? There is no surplus of jobs around, and the jobs that do come up are filled quickly.

I'd discount all this anecdotal stuff about the unemployed sitting around all day watching TV while they collect big benefits. For the most part they're are out there looking for jobs; they know the benefits won't last forever and they don't want to get caught short. The problem is there are too few jobs, not too many lazy people.

There are plenty of jobs around, just not the right fit.

Unemployment welfare removes that urgency from people to seriously look for a job, sometimes even moving to a job far away.

Besides, unemployment wealth transfer consumes vast amount of resources from both the employers and the currently employed. Without this mechanism, more businesses would actually stay open rather than shut their doors. We don't want businesses to shut their doors. Of course we say that, but government does everything in its power to chase businesses away. Look at California.

You run a business. Can you tell me honestly that you could have kept a few more people if it weren't for the extra stuff you didn't have to pay like unemployment insurance and worker's comp?

gunnut
15 Jun 10,, 19:16
I am no Obama fan, but this article is the usual slanted gibberish that does absolutely nothing to throw light on what needs to be done in lieu of what Obama is doing.

What is the alternative? Let the economy tank? Maybe that is what the author prefers. But we'll never know, as he didn't offer any alternate solutions to those Obama's economists have come up with.

And perfect operation of the levers of the economy to make a seamless, painless recovery, who has ever accomplished that?

How do you know the economy would tank if we didn't do anything? $800 billion in "stimulus" accomplished...? Maybe it's not big enough. Let's double it. Then why not a $13 trillion stimulus plan? We can just dictate our GDP numbers and keep it at a constant. Then we'll never have a recession. Better yet, let's run a stimulus plan every year, with a 4% growth rate, starting this year at $14 trillion. That will be our GDP.

JAD_333
15 Jun 10,, 19:24
What do you call that "unemployment benefit" check that people get from the government?

Wait...it's an "entitlement." It's your money for not working.

It's a form of insurance which people thrown out of work can file claims against.

Employers pay a tax to both the state and the Federal government on their gross payroll. The money is set aside for claims, and in normal times, the system pays for itself. A claimant who quits a job without cause, has never worked, or who has not earned income for more than a year previous to filing a claim cannot receive payouts. He or she must have been fired or laid off.

When a former employee files a claim the employer is asked to verify the ex-employee's claim and can challenge it. I've only challenged one in 20 years. A guy claimed I laid him off, when in fact he just stopped showing up for work. His claim was turned down.

In bad times when the number of unemployed increases rapidly, the state and the Federal government have to dip into general funds to make up any shortfall. On the federal level additional money must be approved by Congress.

JAD_333
15 Jun 10,, 19:59
How do you know the economy would tank if we didn't do anything? $800 billion in "stimulus" accomplished...? Maybe it's not big enough. Let's double it. Then why not a $13 trillion stimulus plan? We can just dictate our GDP numbers and keep it at a constant. Then we'll never have a recession. Better yet, let's run a stimulus plan every year, with a 4% growth rate, starting this year at $14 trillion. That will be our GDP.

In fact, some economists thought Obama's stimulus package was too small by half. Keynesian economics calls for a massive stimulus to counter recession and warns of half measures. The stimulus package Obama's people put together was intended to be under $1 trillion ($830B) for political reasons, i.e., anything larger would likely fail to pass Congress.

But to your question: how do we know the economy would tank if we didn't do anything? It's the same kind of question as asking how do we know a house would burn down if we didn't do anything to put out a fire in it. Hey, the fire might go out on it's own. The answer is, we act on probability based on past experience, not on the occasional miracle.

But there are really 2 problems here. First we were heading into a recession. Second we had a housing market bubble bust at the same time.

We dealt with the second by bailing out the banks (TARP) with the 2 aims in mind, keep global investment markets from collapsing and keep credit flowing to companies that depend on it to operate. There's a job preservation angle to the latter.

We dealt with the recession by passing the stimulus bill. It's a jumble of measures; some short term infrastructure stuff, some long term investment stuff (high speed rail) and some questionable stuff on education. In short, it's designed to keep consumer demand going and thereby goosing industry into start hiring again. I simplify.

Would the economy tank if we hadn't done all this? Probably. What if we did nothing and industry had been starving for credit all this time? Would they be hiring? Would more lose their jobs?

As in all things done to prevent the worse, we'll never know if the worse would have ever happened. That's what inspired the saying "damned if you do; damned if you don't."

We're in sandbag mode and the waters are still rising. We'll see.

Roosveltrepub
15 Jun 10,, 20:16
How do you know the economy would tank if we didn't do anything? $800 billion in "stimulus" accomplished...? Maybe it's not big enough. Let's double it. Then why not a $13 trillion stimulus plan? We can just dictate our GDP numbers and keep it at a constant. Then we'll never have a recession. Better yet, let's run a stimulus plan every year, with a 4% growth rate, starting this year at $14 trillion. That will be our GDP.

well since the gop is refsing to move on the benfits extension because, God forbid hedge fund Managers see their nominal tax rate go up from 15 percent your theory should be proving itself out the last few weeks shouldnt it? If there are plenty of jobs I guess Obama has saved the economy...damn he's a messiah:rolleyes: Do you actually know anyone unemployed who wants to collect?

Roosveltrepub
15 Jun 10,, 20:19
What do you call that "unemployment benefit" check that people get from the government?

Wait...it's an "entitlement." It's your money for not working. Do you work?

highsea
15 Jun 10,, 20:30
Well, here's the thing. The Gov't has dumped a bunch of money into the states to prevent layoffs, a lot of that money went into shoring up public pension plans, raises, etc. So they delayed for a year what should have happened back then, which was for states to cut expenses.

And they dumped a pile of money into banks, but that money wasn't lent out. It sat in the Federal Reserve banks and was used to buy treasuries and smaller banks, the profit from that was used to shore up the balance sheets of those big banks, and the principal was repaid at a lower interest than they made on the treasuries.

Now they are taking $30 Billion from Tarp and making a lending account for small businesses. But small businesses don't want to borrow money, we want customers. We are in debt paydown mode, not borrowing mode.

They've done nothing about the GSE's, so that bailout continues unabated.

They've passed new entitlements like the health care bill, which has created a lot of uncertainty for businesses wrt insurance costs.

Cap and Trade is next up, or very soon. More uncertainty for businesses, we have no idea what our energy costs will be.

Our unemployment insurance costs have doubled, which makes every worker more expensive to hire.

It's been nothing but huge spending bills and bailouts, so of course businesses are waiting to see how things will shake out. We've adjusted to a new reality, or we are out of business by now. We've cut every ounce of fat, cut payrolls, and we have stabilized at this new lower volume of business.

We expect it to hold at this level for the foreseeable future- we don't really think it's going to go down, but we don't think it's going to improve either.

Absolutely Obama's policies are bad for businesses, we have no idea what axe will fall next. So we're waiting and holding on until we see some intelligent behavior from Washington. First on the wish list is for Washington to show some fiscal responsibility.

It's a confidence thing. The dems in charge are hostile to business, and we know it. So we're not taking any chances.

gunnut
15 Jun 10,, 20:36
It's a form of insurance which people thrown out of work can file claims against.

Employers pay a tax to both the state and the Federal government on their gross payroll. The money is set aside for claims, and in normal times, the system pays for itself. A claimant who quits a job without cause, has never worked, or who has not earned income for more than a year previous to filing a claim cannot receive payouts. He or she must have been fired or laid off.

When a former employee files a claim the employer is asked to verify the ex-employee's claim and can challenge it. I've only challenged one in 20 years. A guy claimed I laid him off, when in fact he just stopped showing up for work. His claim was turned down.

In bad times when the number of unemployed increases rapidly, the state and the Federal government have to dip into general funds to make up any shortfall. On the federal level additional money must be approved by Congress.

I understand the intent of the unemployment insurance. I just think it's an extremely inefficient system to have government administer it. It should be a private system, where the employers/employees can opt in.

I am my own unemployment insurance. I save a lot of money when times are flush. I got by for a while with no help from the government when I lost my job. People should do that. They don't because we have raised a generation of people who will run to the government for help at the drop of a hat.

astralis
15 Jun 10,, 20:42
highsea,


But small businesses don't want to borrow money, we want customers.


First on the wish list is for Washington to show some fiscal responsibility.


so from a small business owner POV, is your immediate fear lack of consumers, or inflation?

gunnut
15 Jun 10,, 20:43
In fact, some economists thought Obama's stimulus package was too small by half. Keynesian economics calls for a massive stimulus to counter recession and warns of half measures. The stimulus package Obama's people put together was intended to be under $1 trillion ($830B) for political reasons, i.e., anything larger would likely fail to pass Congress.

Keynesian economics...worse than Reaganomics. We'll spend our way out of poverty.



But to your question: how do we know the economy would tank if we didn't do anything? It's the same kind of question as asking how do we know a house would burn down if we didn't do anything to put out a fire in it. Hey, the fire might go out on it's own. The answer is, we act on probability based on past experience, not on the occasional miracle.

I would like to think of it this way: how do we know the house will catch fire if we don't buy fire insurance? The focus should be to prevent the fire from starting in the first place. We did everything to set ourselves on fire. Then we try to smother it with flammable cloth. It may give the appearance of stifling the fire, but it'll come back worse than before.



But there are really 2 problems here. First we were heading into a recession. Second we had a housing market bubble bust at the same time.

We dealt with the second by bailing out the banks (TARP) with the 2 aims in mind, keep global investment markets from collapsing and keep credit flowing to companies that depend on it to operate. There's a job preservation angle to the latter.

Housing bubble was the government's doing. It should have never happened in the first place.



We dealt with the recession by passing the stimulus bill. It's a jumble of measures; some short term infrastructure stuff, some long term investment stuff (high speed rail) and some questionable stuff on education. In short, it's designed to keep consumer demand going and thereby goosing industry into start hiring again. I simplify.

Would the economy tank if we hadn't done all this? Probably. What if we did nothing and industry had been starving for credit all this time? Would they be hiring? Would more lose their jobs?

As in all things done to prevent the worse, we'll never know if the worse would have ever happened. That's what inspired the saying "damned if you do; damned if you don't."

We're in sandbag mode and the waters are still rising. We'll see.

Crappy businesses should go out. Sound businesses should thrive. What we're doing is take money from good businesses to keep them from thriving, then keep the crappy businesses operating so they keep their employees.

Government fiat is keeping the creative destruction of capitalism from functioning properly.

JAD_333
15 Jun 10,, 20:44
There are plenty of jobs around, just not the right fit.

Yes and no. Jobs for median income earners are very tight right now. Jobs for skilled blue collar workers likewise. You have a $1,200 mortgage. You're going to spend your day flipping burgers instead of pounding the pavement? Bye bye house. But forget the stats. I know of many people laid off from factories in my area and for every new job, there are dozens applying. That's the reality.


Unemployment welfare removes that urgency from people to seriously look for a job, sometimes even moving to a job far away.

That's probably true for some, but not true for most. You run your household. You know what it costs. You know unemployment benefits will not answer the mail. They only help make it possible for you to focus on searching for a new job, and then for only so long. If you have no gas or bus fare to get to an interview or no phone to call for job openings, or you're hungry and worried about feeding your kids...try finding a job.



Besides, unemployment wealth transfer consumes vast amount of resources from both the employers and the currently employed. Without this mechanism, more businesses would actually stay open rather than shut their doors.

Employer paid unemployment taxes are passed along to the consumer as a cost of doing business. They are not deducted from wages. If you eliminate them nothing will change for a business, except it can reduce the price of the goods and services it sells. But this will not give them an absolute advantage as all its competitors would do the same.


You run a business. Can you tell me honestly that you could have kept a few more people if it weren't for the extra stuff you didn't have to pay like unemployment insurance and worker's comp?

I don't see it that way. Either I have work for my employees or I don't. If I do, I price my services to include the payroll taxes I must pay. If my cost goes down for any reason, whether its labor, materials or taxes, I either cut my prices or pocket more money, more likely the former. But that is how construction is.

In manufacturing, it's a bit different because you're building inventory to meet orders you anticipate will come. When orders drop off and are likely to stay down for a long time you lay off people. You might delay laying off a few people if you could get a tax break on the other hundred or so, but if you're small (5-10 people), a payroll tax break is meaningless because you still have to cover the employees base pay, which might be 10-30 times the tax break. Kind of stupid to spend $15 an hour to save 45 cents in unemployment tax.

gunnut
15 Jun 10,, 20:47
well since the gop is refsing to move on the benfits extension because, God forbid hedge fund Managers see their nominal tax rate go up from 15 percent your theory should be proving itself out the last few weeks shouldnt it?

Strawman.



If there are plenty of jobs I guess Obama has saved the economy...damn he's a messiah:rolleyes: Do you actually know anyone unemployed who wants to collect?

Yes. All my friends who were out of a job collected unemployment money. They took their sweet time to find a job. They were out of work for a year or more each.

I did not take unemployment money. I was desperate to get a job. But because I saved enough money, I wasn't desperate enough. I took 3 months off (doing absolutely nothing) and then started to look for work.


Do you work?

Yes. Why do you think I am a conservative? Because I love the propaganda?

Working turned me from a bleeding heart liberal to a conservative libertarian.

Roosveltrepub
15 Jun 10,, 20:53
Strawman.






Yes. Why do you think I am a conservative? Because I love the propaganda?

.

I was wondering because you seemed to not understand the importance of benefits gained from a job

:biggrin:yes:biggrin:

JAD_333
15 Jun 10,, 20:55
I understand the intent of the unemployment insurance. I just think it's an extremely inefficient system to have government administer it. It should either be a private system, where the employers/employees can opt in.

Well, you know as far as opting-in, employers are going to stay out. Why take a on a cost burden your competitor might not. If you know how insurance works, you might wonder what the reserve requirements on private insurers would be to deal with massive unemployment when it comes. I expect the premiums would be in the neighborhood of 10-20 percent of gross wages. I guess in the end you pay no matter where the money comes from.



I am my own unemployment insurance. I save a lot of money when times are flush. I got by for a while with no help from the government when I lost my job. People should do that. They don't because we have raised a generation of people who will run to the government for help at the drop of a hat.

I commend you and wish more people would save like that. Being self-employed I can't get benefits unless I stop working completely. But my income is down 50% or more. Savings have gotten me through so far. As for all the people who get unemployment benefits, many have savings, but they've been told for so many years that the benefits will be theirs under certain circumstances. I don't blame them. It's prudent.

gunnut
15 Jun 10,, 21:01
Employer paid unemployment taxes are passed along to the consumer as a cost of doing business. They are not deducted from wages. If you eliminate them nothing will change for a business, except it can reduce the price of the goods and services it sells. But this will not give them an absolute advantage as all its competitors would do the same.

All money comes from somewhere (short term of course). Unemployment insurance cost is passed on to the customers, thus making your product and services more expensive. When that happens, your customers also will pass the cost along to their customers. Eventually, it comes back to your employees. They need more money. And all these make our labor more expensive compared to foreign competition.



I don't see it that way. Either I have work for my employees or I don't. If I do, I price my services to include the payroll taxes I must pay. If my cost goes down for any reason, whether its labor, materials or taxes, I either cut my prices or pocket more money, more likely the former. But that is how construction is.

In manufacturing, it's a bit different because you're building inventory to meet orders you anticipate will come. When orders drop off and are likely to stay down for a long time you lay off people. You might delay laying off a few people if you could get a tax break on the other hundred or so, but if you're small (5-10 people), a payroll tax break is meaningless because you still have to cover the employees base pay, which might be 10-30 times the tax break. Kind of stupid to spend $15 an hour to save 45 cents in unemployment tax.

All these costs are inflated and skewed by government interference. Every single penny that's incurred by a regulation will get passed along. Otherwise you might as well close your business.

All the government interference will require bureaucrats to oversee. We have thousands of bureaucrats to shuffle paper, oversee regulations, and generally contributes zero production to the economy. These people have to be paid. Their wages come from people who actually contribute to the economy, like you and me. This is a huge leakage in our economy. We are less able to compete against foreign labor because we have more government people to support, and more regulations to comply.

Obama has added nothing but more bureaucracy and leakage to the economy. This stifles our recovery.

highsea
15 Jun 10,, 21:03
so from a small business owner POV, is your immediate fear lack of consumers, or inflation?Lack of consumers in the sense that my customers need buyers. But I don't want rapid growth, I've been down that road before and I don't like all that goes with it. So I want to grow slow and predictable.

edit to add: I should clarify what I mean by consumers- neither myself or my customers sell to individual consumers for personal or home type use- our customers are businesses, mainly in the health care field- hospitals, clinics, doctors, device manufacturers, etc. That's about 80% of my business, the other 20% is helicopter parts.

From a personal perspective, it's inflation because I am holding cash.

gunnut
15 Jun 10,, 21:18
Well, you know as far as opting-in, employers are going to stay out. Why take a on a cost burden your competitor might not. If you know how insurance works, you might wonder what the reserve requirements on private insurers would be to deal with massive unemployment when it comes. I expect the premiums would be in the neighborhood of 10-20 percent of gross wages. I guess in the end you pay no matter where the money comes from.

Notice I wrote "employers/employees" instead of just employers. Unemployment insurance should be like health insurance, we pay our own. Employers can advertise that they provide subsidize insurance (health or unemployment) as a fringe benefit to attract more or skilled workers.

Do you supply free food to your employees? You probably don't due to cost. Some companies do. Broadcom (just down the street from me) has subsidized cafe on campus. The employees pay virtually nothing for good food. I mean "good" as in restaurant grade, not dorm food. Google offers free, 5-star restaurant at its headquarter in Mountain View. I'm not sure about the regional offices. People know that and they want to work for Google. I applied for a job there but Google will only hire PhDs. So I work for a company that offers free coffee (Starbucks) and soda. My previous work offers only free coffee, and the coffee was not that good.

Health care reform should have been like this. De-couple from employment. Employers are free to offer subsidized insurance, but not obligated to. Employees can opt-in, or not.

Unemployment insurance should be like this too. Employers can offer one as an added bonus for workers. Or workers can buy their own. There will be companies in this business, just like other insurance companies. Those that suck will be gone. Those more efficient will stay. People are free to choose the level of protection they want. Or they can forgo this gamble and save money on their own.



I commend you and wish more people would save like that. Being self-employed I can't get benefits unless I stop working completely. But my income is down 50% or more. Savings have gotten me through so far. As for all the people who get unemployment benefits, many have savings, but they've been told for so many years that the benefits will be theirs under certain circumstances. I don't blame them. It's prudent.

Thank you sir. I wish more people would do what I did as well. But in economics, "people are rational." They do what's in their own best interest, regardless of the group. Our mess in medical insurance, unemployment insurance, pension, housing bubble, and a host of other things, all stem from excessive government interference that rewards selfish behavior through mandates rather than innovation and hard work.

Roosveltrepub
15 Jun 10,, 21:29
Thank you sir. I wish more people would do what I did as well. But in economics, "people are rational." They do what's in their own best interest, regardless of the group. Our mess in medical insurance, unemployment insurance, pension, housing bubble, and a host of other things, all stem from excessive government interference that rewards selfish behavior through mandates rather than innovation and hard work.

Well, I'd agree with you except before unemployment, social security, pension plans things were in fact worse. If someone makes 50k a yr and does not have insurance are you for denying them care or footing the bill?

gunnut
15 Jun 10,, 21:39
Well, I'd agree with you except before unemployment, social security, pension plans things were in fact worse. If someone makes 50k a yr and does not have insurance are you for denying them care or footing the bill?

Why doesn't he buy insurance?

Why should I foot his bill for his own failings?

Maybe his relatives, church friends, caring and compassionate democrat buddies, or even a charity, can pay for him. I don't know him, don't like him, don't care about him, and certainly don't want to pay for him.

I'll help those I know, like, and care about.

Democrats, liberals, and socialists talk a lot about caring and compassion. They just want to care about others by brute force. I remember listening to this congresscritter talking about why we should pass Obamacare. She said one of her constituents couldn't afford dental care so she had to use her dead sister's dentures. My question to the honorable congressscum would be "why don't you help her if you care about your constituents so much?"

astralis
15 Jun 10,, 21:41
highsea,


From a personal perspective, it's inflation because I am holding cash.


that at least you should have no fear of in the short-medium term.

astralis
15 Jun 10,, 21:42
gunnut,


Why should I foot his bill for his own failings?

we've been on this a million and one times, but you are, because we can't deny him care in the ER- the most expensive care there is.

highsea
15 Jun 10,, 21:47
that at least you should have no fear of in the short-medium term.I don't right now, but I have no confidence it's not coming. At that point I will have to come up with something else, like TIPS or maybe a low-cost index fund.

The price of gold reflects the inflation fear though, and I have no faith in the Fed's ability to keep in under control when the economy starts picking up.

The reason we aren't seeing inflation now is purely a reflection of the poor economy.

gunnut
15 Jun 10,, 21:53
gunnut,

we've been on this a million and one times, but you are, because we can't deny him care in the ER- the most expensive care there is.

1. Why pass Obamacare if the ER can take care of everything?
2. Why bother buying any health insurance at all if the ER can take care of everything? It's not my own best interest to waste money on insurance.

Maybe our concept of ER should be rethought. Maybe we will have a different form of ER if we didn't have mandatory medical insurance. We've never tried that. Or some would say, we had that 150 years ago and it wasn't good. Well, let's try it again, maybe it will be different this time. Isn't that the big government motto? If a program doesn't work, just try harder by throwing more money at it.

There are free clinics run by charities. There will be free ER run by charities if we don't have mandatory health care. The free market can do some amazing things.

astralis
15 Jun 10,, 22:33
gunnut,


1. Why pass Obamacare if the ER can take care of everything?


because health insurance is a LOT cheaper than the ER.


2. Why bother buying any health insurance at all if the ER can take care of everything? It's not my own best interest to waste money on insurance.

because if you HAVE money, the hospital can realize this from you. however, people of relatively low worth can get medical care far above what he can ever pay back.


There will be free ER run by charities if we don't have mandatory health care.

the costs of having expert care, drugs, and treatment available 24/7 is prohibitively high. the reason why it became mandatory to treat people was because too many people were getting thrown out onto the streets as they couldn't pay, and this was causing a scandal.

highsea
15 Jun 10,, 22:45
because health insurance is a LOT cheaper than the ER.Not if you're healthy. I've spent approximately 40K on health insurance over the last 3 years for myself or my employees, without a single claim. That's avg. to cover 3 people in a "cheap" state for a 70/30 policy.

If one of us had an accident and got a broken arm, it would cost me about 15K to pay for everything in a complex fracture.

ER's are way over-used, non-insured people should be directed to public clinics.

The only insurance I am really interested in buying is catastrophic, which will be illegal to sell under Obamacare. I can self-insure the minor things.

gunnut
15 Jun 10,, 22:47
gunnut,

because health insurance is a LOT cheaper than the ER.

The cost of care is the same. Just not borne by the user at the time of transaction.



because if you HAVE money, the hospital can realize this from you. however, people of relatively low worth can get medical care far above what he can ever pay back.

Like I said, maybe it's time to rethink our concept of ER.



the costs of having expert care, drugs, and treatment available 24/7 is prohibitively high. the reason why it became mandatory to treat people was because too many people were getting thrown out onto the streets as they couldn't pay, and this was causing a scandal.

The scandal should be how dumb people are not to buy insurance, or seek out charities who can help them, or family and relatives, or friends, or church group, or any other community group. The scandal is we run to the government for everything instead of relying on ourselves.

Part of this mentality is why people can't afford health care now. If we had to pay for ourselves, we would care to maximize the return on our hard earned dollars. If others are paying, well, why should I try to save your money? Bring on the most expensive care, my friend here will pay for it.

astralis
15 Jun 10,, 23:20
gunnut,


The cost of care is the same. Just not borne by the user at the time of transaction.

if you have a good health insurer, they have policies (like kaiser) that encourage people to use ERs for how they're meant to use-- for emergencies.

lesser, long-term conditions can be managed or prevented at a much lower rate.

people without health insurance will play the high-risk no payment game, and then when something bad happens to them, everyone gets to pay for their risk.


If others are paying, well, why should I try to save your money? Bring on the most expensive care, my friend here will pay for it.

exactly so. so what are the alternatives? you can either make everyone pay and have some skin in the game, or you can deny care. it's not moral, or for that matter even practical to deny care, especially once you boil it down to the ER level.

passing more people over to public clinics is a pretty good idea, but unfortunately if you've ever volunteered in one, they're already quite crowded to start with. and for people with more immediate and serious medical concerns, only a relatively few hospitals will have the specialists, technology, and treatments necessary.

Roosveltrepub
16 Jun 10,, 03:22
ER care is much more expensive than care in a Dr's office. Highsea ER care is cheaper till the day you aren't healthy. One issue being if you rely on the ER and aquitr diabetes, high blood pressure or high cholesterol there is a good chance by the time you need the ER the condition is going to cost me much more than insurance would of cost you. I say me because things like heart failure, heart attacks, strokes and vascular disease are far beyond most people's ability to pay out of pocket.

By cost effective do you mean opt not to get medical care Gunut? We have plenty of uninsured people now and it doesnt seem to be slowing medical inflation In fact it's increased as the numbers of uninsured/self payers has risen.

ZekeJones
16 Jun 10,, 03:44
I want to see this mythical ER that keeps getting mentioned.
The one can provide everything to everyone, including long term treatment like physical therapy or medications that are needed several times a day for life, to name a few.

highsea
16 Jun 10,, 04:06
...Highsea ER care is cheaper till the day you aren't healthy. One issue being if you rely on the ER and aquitr diabetes, high blood pressure or high cholesterol there is a good chance by the time you need the ER the condition is going to cost me much more than insurance would of cost you. I say me because things like heart failure, heart attacks, strokes and vascular disease are far beyond most people's ability to pay out of pocket.Had you read my post, you would have understood that the type of insurance I want to have would cover those things. What I don't want to pay for is insurance that covers everything including a stuffy nose and a scraped knee.

Obamacare makes everything under the sun covered, which means premiums will be unaffordable. I can cover broken bones, strep throat, flu, dental and vision expenses, and typical annual health care costs out of pocket. It's only catastrophic illness that would bankrupt me without insurance.

Obamacare takes that option away, and makes me pay an insurance company for a product I don't want.

JAD_333
16 Jun 10,, 05:18
Notice I wrote "employers/employees" instead of just employers. Unemployment insurance should be like health insurance, we pay our own.

I noticed but didn't see anyway that would work on a practical level. Employee-paid unemployment insurance could only work as a mandate because you'd need a huge pool of employees paying premiums to amass a large enough reserve to take care of normal rates of unemployment as well as massive unemployment in bad times. The premiums would be huge.


Employers can advertise that they provide subsidize insurance (health or unemployment) as a fringe benefit to attract more or skilled workers.

We already have universal employer-paid unemployment insurance. It's mandated by law. Employer-paid health insurance is a true fringe benefit since it isn't mandatory. It is indeed a huge magnet for prospective employees.



Do you supply free food to your employees?

Not regularly and not often. I don't even give them paid time to eat...1/2 hour and back to work. That's the business standard around here. If you're generous about it, your competitors will eat your lunch, if you know what I mean. In reality nothing is free. Someone pays and if a business is generous with food and other perks, that means their customers are paying the freight.


Broadcom (just down the street from me) has subsidized cafe on campus. The employees pay virtually nothing for good food. I mean "good" as in restaurant grade, not dorm food. Google offers free, 5-star restaurant at its headquarter in Mountain View. I'm not sure about the regional offices. People know that and they want to work for Google. I applied for a job there but Google will only hire PhDs. So I work for a company that offers free coffee (Starbucks) and soda. My previous work offers only free coffee, and the coffee was not that good.

Hey Starbucks is a step up.



Our mess in medical insurance, unemployment insurance, pension, housing bubble, and a host of other things, all stem from excessive government interference that rewards selfish behavior through mandates rather than innovation and hard work.

There's a great deal of truth in what you say. Thomas Jefferson greatly feared government interference in people's lives. He believed that people and communities would see to their own livelihood and dispense charity as they saw fit if left to their own initiative and invention, and in that way the nation would become strong. He understood that government welfare for the needy leads able men to become needy by design so they can share in the handouts.

Roosveltrepub
16 Jun 10,, 20:56
I




There's a great deal of truth in what you say. Thomas Jefferson greatly feared government interference in people's lives. He believed that people and communities would see to their own livelihood and dispense charity as they saw fit if left to their own initiative and invention, and in that way the nation would become strong. He understood that government welfare for the needy leads able men to become needy by design so they can share in the handouts.

Do you really believe we have a large class of people who do not wish to work. The charity argument is fine if it had any kind of a record of being accurate once we were industrialized and not a country of mostly farmers. The truth is charity failed that's how we ended up with the programs.

highsea
16 Jun 10,, 21:32
Do you really believe we have a large class of people who do not wish to work. A trip to your local DMV should answer that one for you.