Creating jobs

There are a number of things that are so obvious that stating them seems non-sensible until you think about it. If you want to accomplish something you have to be as direct as possible. In the years I spent reviewing costs, I lived by a fairly simple rule, "If you want to reduce costs, you have to reduce costs." Now, the reason this rule is so effective is because in many instances the proposals I would look at would have all sorts of machinations but when you really studied them, they just moved costs around, and didn't reduce them.

So applying this to our current economic situation, if the goal of the stimulus was to create jobs, it should have created jobs. Now, I will admit that I'm not an expert on every aspect of the stimulus, however, I do know that much of the stimulus money ended up funding things that had very little potential to increase jobs. Now, some of this money may be seed money, with the hope that the outcomes will eventually increase jobs, but it would seem that there were plenty of opportunities for direct job creation that could have been implemented.

You hear a lot of arguments from various politicians that the federal government should not try to dictate specific behavior in granting money. However, when you look through the stimulus plan, there is basically no money that can be clearly linked to direct job creation. One of the great mistakes you see in the bill is how much was given to the taxpayers and social security recipients. The assumption had to be that these folks would spend the money, however, in the current economic climate, more of them saved it then spent it and it provided no real stimulus to the economy at all. Second, the extension of unemployment benefits may have been altruistic, but had the money been used to actually employ some of these people, say having them work on infrastructure repair or energy projects, it would have reduced the unemployment rate and possibly forced some of the folks to be more aggressive in taking action.

How many jobs were saved or created by the stimulus? Clearly not enough. Suppose the Government created 1,000,000 direct jobs performing needed projects or funded the states to create these jobs using something similar to a program we had back in the 70s called the Comprehensive Employment and Training Act (C.E.T.A.), and if these temporary jobs with limited benefits cost $50,000 a year, it would have required $50 billion. However, 1,000,000 created jobs has a multiplier impact and a significant number of other jobs would have been created or saved to support the jobs created. Also, instead of getting unemployment benefits, the workers would be paying taxes and feeling a whole lot better about themselves.

The idea being that the best way to create jobs is to actually create them.